Business Operations Business Models

How Does GoodRx Make Money (Business and Revenue Model)

The GoodRx business model

How Does GoodRx Make Money?
Here’s what you should know:
  • What is GoodRx, and how does GoodRx work?
  • How does GoodRx make money?
  • Prescription Transactions Revenue
  • GoodRx Gold (Subscription Service)
  • GoodRx Care (Telehealth Service)
  • Advertising
  • GoodRx Subsidiaries, Acquisitions, and Exits
  • GoodRx profit and revenue
  • What is the GoodRx business and revenue model?
  • GoodRx funding, net worth, and market cap

How does GoodRx make money if it’s 100% free to use? Well, here is a full, in depth, breakdown of their four (4) revenue streams and the different products and services they offer, as well as the GoodRx business and revenue model, how much GoodRx makes per year, and how GoodRx works.

What is GoodRx, and how does GoodRx work?

GoodRx is a healthcare company offering both coupon discounts on medications and telehealth services.

Founded in 2011 by Doug Hirsch, Trevor Bezdek, and Scott Marlette, GoodRx began trading on the NASDAQ on September 23, 2020, under the ticker symbol “GDRX”.

Since that time, GoodRx is now accepted in over 75,000 pharmacies in all 50 states and has saved more than $30 billion for customers using the service.

How GoodRx works is: Customers can start using GoodRx’s coupon discounts service for free with or without creating an account. But if customers want even more savings and services, GoodRx offers some paid memberships as well.

Some of GoodRx’s competitors include SingleCare, Capsule, PillPack, Express Scripts, OptumRx, and other healthcare companies that offer medication discounts and telehealth services.

GoodRx App in Apple App Store | GoodRx Business Model | How Does GoodRx Make Money?
Source: Apple App Store | GoodRx

How does GoodRx make money?

According to GoodRx’s about page, the company estimates that since 2011, they have helped more than 18 million people pay for a prescription saving them a total of $35+ billion through using the coupon discount service. And to add to that, GoodRx currently has about 20 million people visiting GoodRx each month.

So how does GoodRx make money off of all that money they save for customers?

Below is a breakdown of how much money GoodRx makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 4 ways of how GoodRx makes money in 2022

GoodRx has a revenue model that makes money in four (4) ways; prescription transactions revenue, subscriptions, telehealth services, and advertising.

#1. Prescription Transactions Revenue

GoodRx makes the majority of its money through its prescription transactions revenue. In fact, $593.36 million or 79.6% of GoodRx’s total revenue came from prescription transactions in 2021.

As GoodRx describes it on page 22 of GoodRx’s Q2 2021 Form 10-Q, prescription transactions revenue is “generated from PBMs when a prescription is filled with a GoodRx code provided through our platform. The majority of our contracts with PBMs provide for fees that represent a percentage of the fees that the PBM charges to the pharmacy, and a minority of our contracts provide for a fixed fee per transaction. Our percentage of fee contracts often also include a minimum fixed fee per transaction.”

GoodRx Gold | GoodRx Business Model | How Does GoodRx Make Money?
Source: GoodRx Gold

Note: 88.66% of GoodRx’s total revenue came from prescription transactions in 2020.

#2. GoodRx Gold (Subscription Service)

One of the ways GoodRx makes money is through subscription revenue. In 2017, GoodRx launched its first subscription offering, GoodRx Gold.

GoodRx offers two (2) membership options for its Gold subscription service: Individual and Family. Both of which offer savings up to 90% on over 1,000 prescriptions. In fact, according to GoodRx, Gold members save an average of $106 per prescription.

GoodRx Gold Cost:

  • Individual Membership: $5.99 per month
  • Family Membership: $9.99 per month (up to 5 family members)

#3. GoodRx Care (Telehealth Service)

In addition to GoodRx’s subscription revenue, GoodRx also makes money through its telehealth service, GoodRx Care. And to date, GoodRx’s Care service now has over 1 million Care users according to GoodRx.

In March 2020, GoodRx also launched a Telehealth Marketplace as an extension to their GoodRx Care service.

GoodRx Care Cost:

  • With a GoodRx Gold Membership: $19 per visit
  • Without a GoodRx Gold Membership: $49 per visit
GoodRx Care | GoodRx Business Model | How Does GoodRx Make Money?
Source: GoodRx Care

#4. Advertising

GoodRx offers advertising solutions to pharmaceutical manufacturers through (1) direct mailers sent to GoodRx customers and also (2) integrating their affordability solutions onto GoodRx’s platform for GoodRx customers to see.

Note: Pharmaceutical manufacturers spend ~$30 billion annually on advertising to attract new customers. GoodRx is trying to get a slice of that advertising spend through its more targeted ad solutions.

GoodRx Subsidiaries, Acquisitions, and Exits

To date, GoodRx Holdings, Inc. has made a total of 6 acquisitions.

Source: Crunchbase | GoodRx

GoodRx profit and revenue

In 2021, GoodRx reported $745.4 million in revenue.

Note: Because GoodRx Holdings, Inc. is a publicly traded company, under the Securities Exchange Act of 1934, they must file continuous financial filings with the U.S. Securities and Exchange Commission (SEC). You can find all of GoodRx’s publicly released financial reports, including annual reports, through GoodRx’s investor section on their website.

What is the GoodRx business and revenue model?

GoodRx makes money through a few revenue models that they combine within their company, they are:

  • Subscription based business model
  • Fee-for-service (FFS) business model
  • Advertising business model
  • Referral business model
  • B2B2C (partnerships) business model
  • Mergers & acquisitions (M&A) business model

GoodRx funding, net worth, and market cap

According to GoodRx’s Crunchbase profile, GoodRx has raised $910.3 million over 5 rounds and has a market cap of $2.43 billion as of July 2022.