The company released its financial statements, showing four percent sales growth in 2019Read more...
Phil works with everyone from patients to manufacturers to make drugs cheaper and easier to get
It's no secret that medication is prohibitively expensive for a lot of people and that the problem is only getting worse. While Medicare drugs are rising at 10x the rate of inflation, for every drug that saw cost go down in 2018 there were 96 drugs that saw prices go up.
It gets even worse when it comes to specialty drugs, which are used to treat more complex conditions such as rheumatoid arthritis and HIV. These drugs are only a fraction of the drugs that are dispensed, as they're less commonly prescribed, but because of that they account for nearly half of the cost of prescription drugs.
It was the personal experience of Deepak Thomas that led him to found Phil, a company whose mission it is to make specialty drugs more available and affordable. Thomas, who previously had Lyme disease, told me that getting access to care, and to the medication he needed, was actually worse than dealing with the disease itself.
"When we looked at the problem as individual consumers as well as system builders, our conclusion was that the user experience issue was just the tip of the iceberg. Turns out the real issue is systemic: high-value drugs require significant communication and coordination between MD, patient, pharmacy and insurer. Most of this currently happens as if the Internet does not exist," he said.
Phil was designed as a platform that would connect all these entities, and, as a result, streamline communication and workflow, making much needed drugs cheaper and easier to obtain.
On Wednesday, the company announced that it raised $25 million in a Series B funding round led by new investor GreatPoint Ventures, with support from Tarsadia Investments, Crosslink Capital and Uncork Capital. This round brings the company's total funding to $35 million.
"We are thrilled to partner with both GreatPoint and Tarsadia. These folks have deep expertise in the space having built and funded pharma and related businesses," said Thomas.
Phil works with patients, who have their pills delivered to their door; pharmacists, who has Phil ships drugs to patients, while also managing “front desk” interactions such as collecting insurance or payments; prescribers, to simplying the tracking of prescription drugs taking care of insurance prior authorizations; and drug manufacturers, to help them upgrade their product distribution.
The result is time saved for patients, which can reduce to the time to access medications from over two weeks to just two to three days, while also saving them between 20 and 30 percent on their prescription drugs. Meanwhile, medical offices are able to reduce workload for their staff.
"Most practices often have at least a couple of people on staff to just process paperwork. With the Phil platform in place, they are now able to mostly focus on patient care," said Thomas.
"This translates to better outcomes because more patients actually end up taking their prescribed medication. MD offices and pharmacies save time and effort due to the paperwork automation, allowing them to focus more on care instead of paperwork."
The Phil platform is growing quickly; a year-and-a-half ago it has around 8,000 prescribers using its platform. Now it has over 36,000 prescribers nationwide. It also grew revenue by 15x in 2018.
Now the company plans to use the funding to continue to fuel this growth, specifically by growing out the team, which currently consists of 70 employees across three locations, a number the company plans to at least doubling in the next year. It will also go toward expanding Phil's geographic footprint.
"Today we serve patients in all major states, as well as several of the smaller population centers. We want to extend our reach within these states and get to the rest of them," Thomas explained.
While there are a lot of companies that are currently trying to solve the on-demand delivery problem for retail drugs, including PillPack, which was bought by Amazon for $1 billion last year, Thomas says that Phil doesn't actually compete with any of them.
"There are a lot of adjacent players with interesting approaches in that space, mostly solving patient experience with an app and on-demand delivery. We are focused on specialty verticals with a systemic approach solutions for doctors, patients, and pharmacies. I can't think of anyone else building a platform solution," he said.
What has allowed a company like Phil to flourish in recent years, he told me, is a greater emphasis on patient experience, something that "has traditionally been held prisoner to incumbent business models."
"While healthtech has tried to open this up, the focus has been mostly on point solutions, like software for better record keeping or appointment booking. The patient cares about end-to-end solutions that go beyond point solutions. Lately more and more healthtech companies are solving these challenges end-to-end," Thomas said.
"I see more end-to-end, systemic solutions gaining traction and the scope of the problem is wide, so solutions need to reflect that. Our goal is to continue improving access to critical medications at lower price points and do it at scale. Not headline-grabbing work but important nonetheless."
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