We’ve all been guilty of chasing a good deal. You’ve probably wasted time looking for the cheapest aeroplane ticket or driven across town just to cash in on that Groupon deal.
Former Facebook engineer Scott Marlette thinks you’ll do the same for prescription drugs. His startup, GoodRX, is the first prescription drug price comparison tool that mines data from every single pharmacy in the United States.
“GoodRx will have an impact on buying prescriptions the same way Expedia and Travelocity has changed buying airline tickets,” he added. Consumers find the cheapest prescription drugs, so they don’t have to leave their doctor’s office and feel like they can’t afford the prescription.
Marlette was of the first 20 employees at Facebook. While there, he built Facebook’s photo application. Facebook’s mission is to make the world more open and connected by creating transparency. That culture of transparency heavily influenced Marlette, and he admits, it can make him quite philosophical.
“We found it odd that for something people spend so much money, people were not asking what the prices are and not shopping around. I buy into this extreme view that transparency creates good in the world. Part of the reason it forces good is because it prevents lying. It encourages freedom of speech,” Marlette said.
Even though the bulk of prescription drug costs are often covered by health insurance, consumers can still save money on drugs that are cheaper than their co-pay.
For instance, take the generic drug Zocor. Without insurance, you could pay $6.40 at Costco or as high as $60 (or even higher) at retail. With insurance, if you have a $15 copay, on a typical plan you would pay $15. But you could be paying $6.40 at Costco or $3.50 by mail order after using GoodRX.
And for people whose health insurance covers a much smaller part of their drug costs — or who don’t have health insurance at all — this could be a real benefit.
“From a consumer tech perspective, the healthcare system is very backwards. It’s government, insurance, and hospital driven,” Marlette said. “When I walk into the doctor’s office, I’m not paying. I have zero incentive to pick something that’s lower cost. In consumer retail and Facebook, a lot of people look at what incentives people have.”
He hopes to see some of those incentives applied to healthcare to help reduce cost and provide people with the information they need to make the right decisions about how to spend their money.
Early Facebook employee Doug Hirsch is also a co-founder of GoodRX. Early backers include Founders Fund, SV Angel, GRP Partners, Highland Capital, Lerer Ventures, Michael Ovitz, and Ed Wilson.