A number of regulatory changes have enabled healthcare brands to become consumerized in a unique fashion, resulting in several of the fastest growing companies in history. As regulators have become more sophisticated about different modalities around telemedicine and pharmacy, opportunities have been unlocked by healthcare and supply chain entrepreneurial experts to make a significant impact on the lives of patients and physicians alike. The consumerization of healthcare is a movement dominated by lifestyle brands covering the categories of erectile dysfunction, skincare, and contraception. Companies such as Ro and Nurx have created household brands like Procter & Gamble (NYSE: PG) and Unilever (NYSE:UL). The movement has been defined by increasing affordability of medications and healthcare services, improved convenience for consumers, and transforming medicalized information into content understood by the everyday consumer.
Regulation, the consumerization of healthcare, the evolution of the pharmaceutical value chain, and the widespread public health emergency surrounding SARS-CoV-2 has created a perfect storm for companies to think creatively about solutions to help patients, while moving stress and burden away from the healthcare system.
Because the United States is facing a shortage of providers, telemedicine companies bring a unique offering to the market, especially during these critical times:
(1) The telemedicine modality can enable a much faster response to the needs of patients.
(2) Telemedicine can help unburden the healthcare system from the high supply of patients seeking care.
According to Zachariah Reitano, Ro CEO and Alumnus of the Forbes 30 Under 30 list for Healthcare in 2020, “there are too many people and too few of providers, so there is a structural unbalance where not enough people who need care can get it.”
In response to Covid-19, Ro has today launched a telemedicine triage service for patients seeking guidance and information. This tool was developed in partnership with infectious disease specialists in order to allow patients the ability to report health information such as health history, symptoms, travel history, locale, and proximity to confined cases. Ro’s Coronavirus Telehealth Assessment was developed using the most up-to date guidelines from the World Health Organization (WHO) and Centers for Disease Control (CDC). If a patient is shown to be at increased risk from the assessment, he or she will be connected to a licensed physician for a free video consultation.
Based on state by state policies, CDC guidelines, and WHO guidelines, Ro will contact the Department of Health to coordinate with them for those that require additional tests and treatment.
In addition to the free telehealth assessment, Ro has created a Covid-19 Resource Hub updated every 24 hours in order to provide patients with the most up-to-date information on coronavirus. A key benefit for patients is that information is presented in a patient-centric manner, even for those who have very limited medical knowledge.
As an intellectual and emotional response, Reitano rallied 40 members of his team last weekend to begin executing on the project. Reitano was motivated to create this offering in response to the fact that both his parents are at higher risk of the disease. “My dad is well over 65 and has medical conditions that put him at an increasing risk. Also, my mom is on immunosuppressants, placing her at much higher risk,” says Reitano.
Over the last few weeks, a number of reports have covered the significant negative impact Covid-19 has had on the pharmaceutical supply chain, resulting in mass drug shortages. Companies such as Ro have been well-positioned to shield themselves from this negative repercussion, while being able to still uphold their commitment to patients. “We always have enough on stock for a significant period of time to ensure patients are able to get treated even if there are disruptions in the supply chain,” said Reitano. Recently, Ro publicly announced a relationship with Greenstone Pfizer, a subsidiary of Pfizer (NYSE: PFE), to be the exclusive provider of Ro’s generic Sildenafil. Ro has built relationships such as these to ensure adequate supply of products, while simultaneously bringing the highest quality service to patients. “The active ingredient is from Ireland and the medication is stamped in France. The main intention behind the partnership was to highlight quality and bring transparency to their supply chain,” says Reitano.
Ro’s response during this sensitive time demonstrates how companies participating in the consumerization of healthcare movement have a unique opportunity to expand into categories beyond lifestyle. As an increasing number of companies are allowing their employees to work from home, these types of services provide a valuable offering. For at-risk patients on numerous medications as a result of chronic diseases, it may be difficult for them to pick up products from their local pharmacy. Direct to consumer companies who have created new opportunities in the pharmacy supply chain will be able to provide benefit to this group of patients. By allowing for mail-order options such as Pillpack and Eagle Pharmacy, patients with chronic degenerative diseases have increased accessibility to the medications and products they need.
“We are in the era of Consumer Telemedicine 1.0, which is characterized by a focus on primary care, urgent care, cosmetics, and other cash-pay conditions. With this new era of Consumer Telemedicine 2.0, we will see a bigger shift to the increasing expansion of telemedicine to include specialty areas, insurance reimbursement, and an increasing spectrum of applications and conditions,” says Dr. Cameron Sepah, CEO of Maximus and Clinical Professor at UCSF Medical School.
Many of the emerging direct to consumer companies are focusing on more niche patient populations and communities. According to Bessemer Venture Partners’ Healthcare Investor, Morgan Cheatham, “I think the jury is still out as to whether these companies are capitalizing on a regulatory shift in healthcare that will enable them to become large independent public businesses or whether they will find homes at incumbent consumer companies such as Walmart, CVS, or even broader consumer brand holders such as P&G or J&J.”
The delivery of care through direct to consumer platforms is here to stay and will likely influence the delivery of other services such as lab testing and at home diagnostics. It is clear the benefit of early-stage companies is their advantage to be agile in responding to urgent healthcare challenges. “One thing is for certain….healthcare is a $3.6 trillion industry and growing. And while that’s interesting on face value, consumer companies that identify opportunities in the many smaller, but still multi-billion dollar markets that make up the industry – that’s where we’re going to see this model continue to take shape,” says Cheatham.