• Market Crumbs

Prescription Management Space Heats Up


Image via Christina Victoria Craft on Unsplash

The last couple of years has seen Amazon and Walmart open their wallets to acquire their way into the prescription management business. Amazon spent just over $750 million to acquire PillPack in 2008, while in June Walmart acquired the technology and intellectual property from CareZone, a startup which helps people manage their medications, in a deal that is believed to be for about $200 million.


The companies are going after the nearly $500 billion spent on prescription medications in the U.S., according to IQVIA. IQVIA predicts 2% to 5% net spending growth to 2022, with growth of 1% to 4% in retail and mail-order prescription drugs. The U.S. Centers for Disease Control and Prevention found 6 in 10 adults in the U.S. have a chronic disease, with 4 in 10 having two or more.


UnitedHealth Group, the largest healthcare company in the world by revenue and the largest health insurer in the U.S., decided it isn't going to sit back and watch Amazon and Walmart take over the online pharmacy space. UnitedHealth reportedly acquired startup DivvyDose, which delivers medicines in pre-sorted packages and competes with PillPack, for more than $300 million. Both companies have yet to announce a deal has been completed.


Once users transfer their prescriptions to DivvyDose, they'll begin receiving "divvyPACKS" with the pills that need to be taken each day. The company also handles refills, accepts all major insurance plans and says the prices stay about the same as a typical 30-day refill price.


If the deal materializes, it will be a big payday for DivvyDose founder Dr. Arvind Movva, who founded the company in 2015. According to Crunchbase, the company hasn't raised any institutional funds from venture capital funds or private equity investors. Movva's biography says he's a former physician who "became increasingly frustrated watching his patients suffer with chronic diseases that could be managed by taking the right medication at the right dose at the right time."


The prescription management space is attracting a lot of money. Alto Pharmacy, which is a digital pharmacy that delivers prescriptions, raised $250 million earlier this year at a valuation of more than $1 billion. Capsule, which delivers medications in as quick as two hours, raised $200 million last year to expand to other large cities. Even Uber recently announced it has teamed up with NimbleRx to offer pharmaceutical delivery in Seattle and Dallas, with plans to grow in the coming months.


As money pours into the quickly growing prescription drug delivery and management business, it will be fun to watch industry giants such as UnitedHealth try to fight off the likes of Amazon and Walmart.

Leftover Crumbs

  • Mortgage demand slips. Although mortgage rates remained near record lows, total mortgage application volume dropped by 4.8% last week, according to the Mortgage Bankers Association. Applications to refinance a home loan fell by 7% last week but remain more than 50% higher compared to the same period last year. Applications to purchase a home fell by 2% last week and now stand 22% higher than the same period a year ago. "There are indications that refinance rates are not decreasing to the same extent as rates for home purchase loans, and that could explain last week's decline in refinances," MBA economist Joel Kan said.

  • Regeneron cocktail shows promise. Regeneron released data from an early trial showing that its antibody "cocktail" for Covid-19 reduced viral load and the recovery time from symptoms in non-hospitalized patients. "After months of incredibly hard work by our talented team, we are extremely gratified to see that Regeneron's antibody cocktail REGN-COV2 rapidly reduced viral load and associated symptoms in infected COVID-19 patients," Regeneron President and Chief Scientific Officer George D. Yancopoulos, M.D., Ph.D. said.

  • Tim Cook lands stock grant. Apple CEO Tim Cook has been awarded his first major stock grant since 2011 in what could see him earn one million Apple shares. The initial grant is for 333,000 shares with the opportunity to earn an additional 667,000. "For the first time in nearly a decade, we are awarding Tim a new stock grant that will vest over time in recognition of his outstanding leadership and with great optimism for Apple's future as he carries these efforts forward," Apple's board said.

  • Caesars acquires William Hill. Casino operator Caesars Entertainment is acquiring gambling company William Hill for $3.7 billion in a move to expand its presence in the quickly growing sports betting market. Caesar's intends on selling William Hill's non-U.S. operations and doesn't foresee any job losses as a result of the deal. Private equity firm Apollo and online gaming company 888 could potentially be among those interested in the non-U.S. operations.

  • Facebook integrates Instagram and Messenger. Facebook is currently testing allowing users from Instagram and Messenger to message each other in the company's latest move to integrate its platforms. The update also includes updates to each app, including Messenger's Watch Together feature, which lets people watch videos together during video calls. Facebook didn't say when the update will be available for everyone, saying it is being "tested in select markets and will expand globally in the coming months."