An Eastern Iowa pharmacy business has raised $2.5 million in investment funding to push forward its prescription delivery and management system.
SmartScripts, based in Washington, announced the investment, its first large round of fundraising, on Monday. The retail pharmacy has worked to develop a better way to package prescriptions for customers who need to take more than one type of drug a day.
“Our goal is to really simplify the process of people taking prescriptions,” company CEO and co-founder Todd Thompson told The Gazette.
Thompson, who has been in the pharmacy business for 20 years, said customers who take more than one prescription can face complicated schedules with restrictions on when and how patients need to take their medication.
“No one gets that right by the time they get home. It just ends up costing the system money, costs (the patients) issues with their health,” he said.
Instead of sending patients home with multiple pill bottles, Thompson said SmartScripts uses an automated process to package prescriptions in individual pouches based on when patients need to them. SmartScripts then delivers those packages directly to customers.
“Instead of you making four, five, six, 10 trips to the pharmacy, we synchronize them so everything is filled on the same day, once a month, and then we package them in that system through automation,” he said.
Rural Vitality Funds, an investment fund under the Iowa Farm Bureau Federation, was SmartScripts’s lead investor.
“We could not be more excited to being working with SmartScripts as they continue to tackle the large problem of prescription medication adherence,” Adam Koppes, Iowa Farm Bureau investment manager, said in a statement.
Des Moines-based venture capital fund Next Level Ventures and the Cedar Rapids-based Iowa Startup Accelerator also invested.
Thompson said SmartScripts also has joined the Startup Accelerator program.
SmartScripts will use the funding to hire sales staff and build software to better connect with customers. The company also plans to open a new office in Iowa City with three full-time employees, Thompson said.
SmartScripts currently has 10 full- and part-time employees. During the next 12 to 18 months, Thompson said the company expects to have more than 50.
The nation’s retail pharmacy industry is dominated by a few giants, such as Walgreen’s and CVS. Thompson said his company can compete, in part, because it deliver prescriptions and doesn’t rely on in-store sales.
“Our model isn’t necessarily to bring people into a store. My thought is, when you don’t feel well, the last thing you need is to go out and drive to a pharmacy to pick something up,” he said.
Amazon.com has looked at getting into the prescription delivery business. The Wall Street Journal reported in October Amazon was exploring whether to do so.
“It takes a piece of the market share, but the beauty of this business is, there’s always room for people who offer a superior product and service,” Thompson said of his own company.
Retail pharmacies in the United States sold more than $379 billion worth of prescription drugs in 2016, according to the Kaiser Family Foundation. In Iowa, those sales were more than $3.6 billion last year.
The pharmacy business runs in Thompson’s family. Thompson is the stepdad of Roby Miller, founder of telepharmacy company Telepharm, which was acquired by Cardinal Health last year. Miller does not have an official role with SmartScripts, Thompson said.