In this episode, Morgan Stevenson (Director of Client Success at Vynyl) sat down with Scott Martin, founder and CEO at Rescription. We discussed how Rescription is pioneering an innovative prescription drug solution to provide clarity, simplicity, and improved outcomes to patients.
Product in Healthtech is community for healthtech product leaders, by product leaders.
For more information, and to sign up for our free webinars, visit www.productinhealthtech.com.
To view this full episode on YouTube: https://youtu.be/mHCeS7aswck
Morgan Stevenson 0:07
Welcome back to Product in Healthtech, a community for health tech product leaders by product leaders. I'm Morgan Stevenson, Director of Client Success at Vynyl. Today, I sat down with Scott Martin, founder and CEO at Rescription, we discussed how they are pioneering an innovative prescription drug solution to provide clarity, simplicity, and improved outcomes to patients. Let's jump into the conversation. Hi Scott, thanks for joining us today at Product in Healthtech.
Scott Martin 0:35
Thanks, Morgan. It's great to see you and I'm really looking forward to it.
Morgan Stevenson 0:38
Tell us your story and a little background on how you got to your position today.
Scott Martin 0:43
This is Rescription is the fourth company that have launched in healthcare after three successful exits. The most recent company prior to this I sold just over a year and a half ago called Remedy Analytics, which was directly in the prescription drugs space as well, but more from the component of optimizing the broken system that we're all stuck with, currently, which is through the PBMs of prescription benefit managers, and optimizing that program for the employers in the country. And what we started to realize over time was that we were creating a blueprint for actually creating the first of its kind alternative system. So that's what Rescription is, and we launched just over a year ago, about the same time that I exited the last company. And you know, that's how I got to where we are today. But I've been in healthcare my whole career,
Morgan Stevenson 1:47
There's so much to build and solve for in health care, you mentioned optimizing within a broken system, how is Restriction, replacing the typical PBM?
Scott Martin 2:00
If I step back to, you know, my career as a whole, you start to realize, when you are in one space and focus on that space every day, you know, you know what, at a pretty high level. And the problem with with health care and insurance in general. And really the whole spectrum of health care is is it's broken by design from the status quo. And there are so many entrenched levels of conflicts of interests that control the system, that it's very hard to make changes. And you need to really understand how the pieces come together who are those conflicts of interest. And when you have an idea of doing something better or more efficiently, you need to understand all those moving parts to really be able to do it. And so when we look at what we're doing with Rescription, which is taking on, you know, the titans of the industry, the PBMs, and the insurance carriers, we realize that the only way to do it in our humble opinion is that you need to replace the entire PBM program. So what we see in the market today are a number of companies that are out there, performing what we call point solutions, where they're they're remaking or reworking, or creating a new way of doing one component of the prescription drug program. And the problem with that is that you can't replace anything with that one component. And the status quo won't work with you. And partner with you. So our model is to come in and and replace the whole system from A to Z from the least expensive drug to the most expensive drug, which creates a little bit more of a challenge. But the end result is actually possible, but then at the same time, a much more effective solution overall.
Morgan Stevenson 4:05
You make it sound so simple, but in terms of untangling some of those conflicts of interest that control the inherently broken system, from an industry and both a product perspective, how exactly does Rescription provide an alternative solution to these PBMs? And exactly what benefits does this offer to employers and employees?
Scott Martin 4:29
Yeah, so we have the luxury of this history, not only my history, but that this unique team of leaders that I've brought in and helped to create Rescription with and at the end of the day, you know, in order to to make these changes, you need to know what needs to be fixed and how to fix it. And so, the first thing that we did was to realize that there are certain entities that are aligned with the end user and the end result, we want, for example, disproportionate share health systems state to state. So the first part of the program that we created was the realization and the process for partnering with these disproportionate share health systems. And all that means to be a disproportionate share our health system, which just over half the health systems in the country are disproportionate share is that they treat the indigent on an inpatient basis. And those are the systems that have access to unique and special pricing on the prescription side. And so in partnering with them, we're able to to harness that in the right way so that the patient ends up winning with the lowest lowest cost for the prescription drug. But the way that we're we're doing this as is looking at each component, and deciding Is that something that we need to recreate that we need to build that we need to restructure? Or is it something that that an independent entity has already done it in in a super successful way where the technology is state of the art, they have a track record, the deliverable is there. And so in those situations, we partner with those entities and we've got just over 28 partners currently, where we've decided that doesn't make sense to build that. And then we've built where we've needed to build, and there's really the that our our whole program is targeted towards employers. So if you look at a health system, they're obviously also an employer. So the health system is that unique relationship with a partner in that state to deliver the solution to the employers the better prescription program, with the lower costs and the clarity. And then by default, they win because we also put it in place for their own employees. So they benefit both ways they're saving on their own employees, but then they're also generating revenue, every time we sign up an employer, because they're our partner. And that's how they get paid for providing the components of the services that they provide. And that's how we get paid with with for providing the the components, and the items that that we provide service.
Morgan Stevenson 7:26
You mentioned having launched over a year ago, what is an example of an employer or either or a patient winning in terms of purchasing prescriptions,
Scott Martin 7:37
So that the end result is a net 30 to 50% savings. And again, it's on every prescription, that that's out there, the real focus on top of that is what people refer to as specialty drugs, we call them 'high cost drugs', there's there's about 500 of them that we have in our program. And the unique aspect of how we're we're solving that component is by leveraging the pricing that the health system has. And in doing that a member will get their prescription that will come in to to our application, and they'll be able to see the information about the drug. And so for example, one of these high cost drugs could be $25,000. And they would see that their out of pocket is $2,000. And they they can go ahead and get that drug today and pay that high cost. But the difference with our program is we're going to give them an option B right there on the platform. And they're going to see that if they go through these three steps, which I'll explain in a second, they will be able to get the prescription at zero cost. So they're able to make an informed decision on am I willing to go through these three steps which include a telemedicine visit with a specialist at our health system partner, which is part of the the high cost drug review. So that's one step and then we handle the other steps, we automatically upload the patient's EMR so the doctor can make an informed decision. We have patent pending technology that allows us to adjudicate the claim only after all of the compliance steps for this medication have been checked and accounted for. And then the prescription goes through the system through the health plan, and the member can either pick it up at the health system, they can have it mailed to them, or they can pick it up at a kiosk at their office or locations in their geographic areas. So the member wins because they're paying nothing out of pocket on a prescription that they very easily would have paid $2,000 or more out of pocket and the employer saves because they're paying the lion's share of the drugs on a daily basis universally, so they're reaping that that 30 to 50% savings on the medication as well.
Morgan Stevenson 7:37
So if you're offloading two of the three steps for the user, that sounds like an outstanding user experience. But I'd love to learn and hear a little bit more about the customer roadmap or customer journey with Rescription. And how does an employer or a patient get in into the Rescription ecosystem?
Scott Martin 10:27
Yeah, so great question. So the the employer gets into the, in order to create the ecosystem, we need that health system partner in the state, once we have that, then we do an outreach to all the self-funded employers, which basically means employers with 1000 employees and greater, we reach out to all of them in the state to make them aware of this program. And if their employer decides to sign up for it, then all of a sudden, all the members have access to, to our program. And again, it replaces their current PBM program. So the real key here is, you know, looking at okay, well, what would be the decision for an employer to do this. And a simple analogy is that every employer and employee in the country are buying their prescriptions today exactly like the following. If all of a sudden, after work, any of us go to our supermarket, and everything had changed from the night before. There's no more labels on anything, there's no more prices, and you put what you think you want in your car, you check out and they say, that'll be $485. And there's a mysterious $120 rebate, we can't tell you any detail about it, take it or leave it, and you end up paying for it and walking out. That's how it has happened for the last 30 plus years in our country. And we're reversing that we're changing it so that it's back to the simple transaction. So that that happened in a in a supermarket. So we're able to go to the employer and say, 'What do you really know about your current PBM program'? And the result is that the employer will tell you, all I really know is what I paid over a previous 12 month period, I know what in the aggregate, we as an employer paid the PBM. I don't know any of the prices, I don't have an itemized bill that have very little detail. And those are all the reasons that we we can't stand our PBM program. And so we come in and say, well, we can change all that, you know, reverting back like this, the supermarket we have a price for every prescription, it's the lowest price for every prescription, there's no markup on any of the prescription drug prices, all of the games at the PBM play go away because of this radical clarity that we're creating. And we charge a simple per member per month fee to the employer. And that summarizes the simplicity of the program. So not only are they saving the 30 to 50%. But just as importantly, they have this clarity that they've never had before and black and white proof of the savings. So it really is remediating an entire system.
Morgan Stevenson 13:22
Yeah, it's very countered to the typical experience, which I think healthcare is probably the only industry where a consumer does not know the price of something that they're purchasing. So that's, that's excellent. So Scott, aside from having vast experience in the healthcare industry, what strategies do you use to ensure that your companies and products remain both innovative and competitive in the market?
Scott Martin 13:47
Because we're really creating an entirely new alternative prescription system. There is nobody that we know of that's out in the marketplace. Doing this, there's, as I mentioned earlier, a handful of smart people and companies that have point solutions, and the neat thing with that, like, it allows us to, to partner again with the with those entities. So for example, somebody that may or may not be creating better prices for generic medications. If we identified that they in fact have lower prices, we're able to bring them into our system. Since we're agnostic, we're able it's not about our generic drug versus somebody else's. It's about who has the least expensive generic drug that we can distribute to our members who has the least expensive high cost drug who has, you know, the best programs that are out there and that that enables us to be able to do that. So, right now, we're lucky enough to be the pioneers in this and and I assume like like any group that's pioneering something eventually you have, you have followers. But the terrific thing is that our team has a long list of innovative, creative, meaningful solutions that can be part of this program. And I'll just mention one of them, because one of the things that we talked a lot about here in the beginning is the actual price of the drug and getting the drug at a lower price. But all you have to do is Google the problem of abandonment and non adherence. And everybody's been to the the pharmacy where you actually see the person, the pharmacist going through the bin by last name, and its prescription after prescription, looking for your name. And at the end of the day, over 60% of those prescriptions are never picked up, they get filed back and restocked back with the pharmacy. And so why is that important? It's important because when you look at somebody that is suffering from an illness, and they're either not picking up their medications, or not taking them as they're supposed to, for example, take a diabetic patient, all of a sudden, we can see that they are not taking their medication, and they've been in the emergency room twice a month, for the last six months. Obviously, that's an expense to the member, it's not good for their health, and it's an expense to the employer. Our system has the ability, because of the fact that all of the prescriptions come into our application and all that visibility and communication is there, we're able to see that Tim Smith didn't pick up his prescription, it's been four days, our white glove concierge team is able to reach out to Tim to find out, did he forget? Is there a side effect, he didn't want to tell anybody? What is the reason we're also able to reach out to the prescriber, because believe it or not in the crazy PBM system that exists today, the prescriber doesn't even know that their patient didn't take the prescription. So we're notifying that prescriber and we're resolving it and measuring it. And again, that's a much bigger financial problem and outcomes problem than even the prices of the drug. And that's something we're going to be rolling out as we get into the second half of this year. And it's just one of a whole slew of items that we've come up with and really comes back to, you know, the the PBMs took something that was once simple and made it incredibly complex. And you only do that for nefarious reasons, we're bringing it back to the simplicity that it should have. And when you do that, the the dominos kind of lay down in front of you as far as all the unique opportunities that you can seize, to continue to make it a better program and to your point, you know, a streamlined user friendly program, because just as important as getting the savings and the outcome is being able to say wow, that was really effortless. And it was not a headache. And it wasn't a long process. And it wasn't frustrating. It was just the opposite. It was a great experience. And I would recommend it to the next patient.
Morgan Stevenson 18:12
Aside from simply lowering the cost of these prescriptions. Rescription has features that ameliorate the issue with medication adherence, which is obviously will result in better clinical outcomes. That's that's really outstanding, you make building a new alternative to a very ingrained system sound quite easy. What are some of the biggest challenges and opportunities that you encountered in building Rescription?
Scott Martin 18:39
Yes, as I've told early on, are investors who are looking to you for security and a sense of comfort before they invest their money with you, which I take very seriously. I'm brutally honest with them that this is my fourth company. And it's like being a freshman all over again. And you would like to think that you learn from every mistake you've made in the past, but this is a roller coaster and you you're holding on by your fingernails a lot of times and you need to be resilient, you need to get knocked down and get back up and dust yourself off. And when you put the team together you think about that as well. Because while this is what I've made my life about and what I thrive on, and I use fear as a motivator, and all these things that make black and white sense to me to you know a regular person or or any other person, those things can be terrifying and things that they don't want to be around and so it's important to find people that are part of your team that enjoy that as well that thrive off of it and understand it and want that because the last thing you want to do is convinced somebody to join your team or convince somebody to invest in you that looks at things differently and doesn't see them the same way that you see them. And then the counter to that is once you find people that have those characteristics, the last thing you want is a group of yes, people that, you know, are just agreeing with you, you want to be challenged, you want them to have to be able to bubble their ideas to the surface, you you don't want to create this for the same reason that I haven't worked at a large company in a long time corporate type entity is because of the red tape and the hierarchy and a lot of what I perceive as the negative things that hold a company back the politics. And so I've gone out of my way, and I've become better at it as time has gone on, where you really foster an environment where you're hiring super talented people, you're not micromanaging them, you're letting them do their thing. And you're letting these ideas bubble to the top and make sure that politics don't develop. And that gets harder as you get bigger. My last company was the biggest to date and when I saw that we had just over 60 employees. The exciting thing about redescription is, we have the opportunity to be 1000 times bigger, not only from a people count, but from a revenue opportunity and most importantly, the outcome to be able to this mission of being able through health equity to create savings for the masses. And when I say the masses, the employees at all these employers, and that that includes everybody that's you know, from low on the totem pole behind the totem pole without discrimination. And we really are at a crossroad right now employers and employees cannot afford these expensive prescriptions, and even the, the what's considered the the less expensive prescriptions. If you look at the FDA pipeline, there are literally 1000s of drugs on an exponential curve, that fit these high cost categories that are in the pipeline and will be here soon. So this problem is not going away. And we humbly believe we have a solution for the prescription problem in our country. And interestingly enough, where we're bringing the prices down in this 30 to 50% brings us to the same price level as the other countries in the in the world. And that makes a lot of sense when you look at the fact that we're replacing the PBM. And the fact that no other country has a PBM except the United States. So we're replacing the PBM or we're ending up with the same price that other countries are paying, you can kind of connect the dots there.
Morgan Stevenson 23:00
So Scott, what do you think are the other important trends that are emerging in healthcare right now? Are there any interesting areas at the moment is anything oversaturated that you think could maybe be overlooked, focused on an on an underserved area?
Scott Martin 23:17
Great question. The prescription area in itself is just a massive, massive market. And then obviously, if you look at at medical health care as a whole, even on top of prescription, it's even a bigger component. And you're seeing tons of companies pop up with great ideas, great initiatives, smart people. And and I applaud that, I think I would, I would say and I have said to, to younger folks that are nearing the end of college and looking for their career out of college, didn't go to college, looking for a career, to get into the healthcare space. And to get into it on the side of companies that are bringing smart solutions, whether it's technology, whether it's a process, whether it's a smarter way of doing something more efficient way of doing something, healthcare needs it. I don't think any of us want the government to take over. We want to have the private sector solve it. But if the private sector doesn't solve it, it quite possibly could be something that government takes over down the road. And I personally think that would be a step backward. So my hope is that the private sector will continue to focus more and more on this and that the the younger generation the you know, the hope for the future will we'll jump in with both feet into the space. We just hired our intern, great young man by the name of Jake Baker, who wants to Trinity College he's about to graduate. And we liked him so much in the internship, we convinced him to come on board with us. So that's that's a great example I think of, of, you know how to continue to build towards these solutions.
Morgan Stevenson 25:14
Shout out to Jake Baker. Excellent. Does Rescription work with any third party technology vendors? Have you explored the options of building versus buying? And if so, what are some of the points that you use to evaluate these vendors and their products,
Scott Martin 25:33
I know where my strengths are, and where my weaknesses are, which is part of the comments I was making on the team earlier. So our Chief Technology Officer, John Zerden, actually knew about Vynyl prior. So that made it easier. But he was the one with his team that did the vetting and made the decision to partner with Vynyl on a number of different components of our technology build out, for example, on the claim adjudication side of what we do, it didn't make sense for us to start from scratch and try to build a better mousetrap. That's not where the problem is that we want to address. So luckily, because of our background, we know who had and has the best technology, and who would be willing to white label it for us in an exclusive relationship. And so we did that. And there's over 38 examples right now of entities like that, that we've partnered with, leaving us the opportunity to focus on what's broken the pricing, the process of going through the channels to get the right drug at the right price, from the right location, and being able to put those components together, including abandonment and non adherence, like I mentioned earlier.
Morgan Stevenson 26:53
And is there something that your team has shipped recently that you are particularly proud of at the moment?
Scott Martin 27:00
Yes, so our first client is now just over two months old, we we started the company a year and a half ago. The our CFO Steve Mirante, likes to say we've been building the plane as we've been flying it, which is pretty accurate. So in a, in a, quite frankly, a miraculously short period of time, we launched the company built the team built the technology, build our process, put our partners in place, and launched our first client Newbridge Bergen Rutgers health system in New Jersey, and we're now working on landing our first employer client, in addition to the employees of Bergen Newbridge, in New Jersey, and they went live on 1/24. And I'm happy to say that things are going so well. And we've delivered on everything that we promised that the client has already taken us into the county employees and the state employees on on our behalf. To add them as clients coming up this following January, we also got a verbal commitment from St. Luke's health system in Idaho, the biggest sale system in the state, which we're very excited about, we have a meeting on the 14th to go in and solidify all that we already have a number of employers in, in Idaho, but the greater Boise area that have invested in us and are going to come on board as clients, 1/24 And we've got a number of other health systems employers and other states lined up and ready to go so that today it is our our biggest achievement getting up and running and having this momentum that we've we've created in in a very difficult market and and financial market, but also very difficult industry to break into.
Morgan Stevenson 28:58
Yeah, that's an incredible achievement and definitely something that you and your team should be proud of both Scott it was really great chatting with you today and learning about the important work that you are doing at Rescription for the people that are you interested, how can they get in touch with you?
Scott Martin 29:14
So they can find me on LinkedIn and they can also reach out to me over email at simple at Scott@rescription.com. Prescription but it's take the P out rescription.com. And we'd love to hear from you and be happy to respond.
Morgan Stevenson 29:34
Great. Thank you so much.
Scott Martin 29:35
Thanks, Morgan. I appreciate it.
Morgan Stevenson 29:38
Thank you so much for joining us. You can connect with us on LinkedIn, YouTube, or on our website, productinhealthtech.com. If you have ideas or suggestions on what you'd like to hear on a future episode, or if you'd like to be a guest, please shoot us an email at info@productinhealthtech.com