GoodRx and Kroger Sign Direct Contracting Agreement

Rhea-AI Summary

GoodRx (Nasdaq: GDRX) has entered a new direct contracting agreement with The Kroger Co. to offer enhanced prescription savings at over 2,200 Kroger pharmacy locations nationwide.

Starting June 1, 2024, patients using a GoodRx coupon can expect almost 50% more savings on most generic medications.

This partnership aims to support Kroger's business objectives and improve patients' access to affordable prescriptions.

GoodRx will discuss this agreement during its Investor Day on May 15 at 9 a.m. ET.

Positive

• New direct contracting agreement with Kroger.
• Enhanced prescription savings of almost 50% on generics.
• Agreement covers over 2,200 Kroger pharmacy locations.
• Supports Kroger’s business goals and patient affordability.
• Investor Day discussion emphasizes transparency and engagement.

Negative

• Specific financial terms of the agreement not disclosed.
• Implementation not effective until June 1, 2024, causing delayed impact.
• Potential dependency on Kroger partnership.

Insights

Financial Analyst

The agreement between GoodRx and Kroger underscores a strategic move to enhance cost savings for consumers on generic drugs. Retail pharmacies, including Kroger, face considerable competition in terms of pricing and customer retention. By securing almost 50% more savings on generics for patients, GoodRx positions itself as a important player in the prescription savings market. This agreement could drive higher customer traffic to Kroger’s pharmacies, thereby increasing Kroger’s pharmacy sales. For GoodRx, this cements its value proposition to consumers and could result in increased usage of its platform.

From a financial perspective, the direct contracting model is cost-efficient for both parties. GoodRx minimizes overhead costs by eliminating intermediaries, while Kroger can offer better prices without sacrificing margins significantly. This collaboration could potentially boost GoodRx's revenue streams and profitability in the long run. Investors should monitor GoodRx’s upcoming quarterly results for any uptick in consumer engagement and revenue stemming from this deal.

Market Research Analyst

This direct contracting agreement is significant from a market positioning standpoint. The pharmacy retail sector is highly competitive, with numerous players striving to attract price-sensitive customers. By offering substantial savings on generics, both GoodRx and Kroger are likely to capture a larger share of this market. The move also demonstrates GoodRx’s commitment to enhancing its value proposition, which could bolster its market presence and brand loyalty.

The potential impact on consumer behavior is substantial. Patients will have a financial incentive to choose Kroger pharmacies over competitors, driving traffic and potentially increasing sales of related healthcare products. The ripple effect could also benefit Kroger’s overall store traffic, as customers may take advantage of other in-store offerings while filling their prescriptions. It’s essential to follow consumer sentiment and market share trends to fully gauge the long-term benefits of this agreement.

Companies now offering almost 50% more savings on most generics at more than 2,200 Kroger Family of Pharmacies

SANTA MONICA, Calif.--(BUSINESS WIRE)-- GoodRx (Nasdaq: GDRX), the leading destination for prescription savings in the U.S., today announced a new direct contracting agreement with The Kroger Co. to deliver improved prescription pricing at more than 2,200 Kroger family pharmacy locations nationwide.

“We are excited to renew our relationship with Kroger,” said Scott Wagner, Interim CEO of GoodRx. “Kroger has been a valuable participant in the GoodRx marketplace over the years and an innovator in healthcare, nutrition and wellness. We’ve leveraged our direct contracting model to reach an agreement that we believe supports Kroger’s business goals and helps patients get the prescriptions they need at affordable prices.”

A key focus for GoodRx in recent years has been transforming how it delivers value to retail pharmacies. By leveraging its direct-contracting model, GoodRx and Kroger have reached a mutually beneficial agreement that enables them to deliver lower prices directly to patients.

Starting June 1, 2024, patients can present a GoodRx coupon at Kroger Family of Pharmacies to receive almost 50% more savings on the expected patient price for most generics, compared to previously available prices on their prescription medications.

GoodRx will be discussing this news during its Investor Day today, Wednesday, May 15, starting at 9 a.m. ET. You can register for the event here.

About GoodRx

GoodRx is the leading destination for prescription savings in the U.S. We offer consumers free access to transparent and lower prices for generic and brand medications, as well as comprehensive healthcare research and information. We also equip healthcare professionals with efficient ways to find and prescribe affordable medications. Since 2011, GoodRx has helped consumers save more than $75 billion and is one of the most downloaded medical apps over the past decade.

GoodRx periodically posts information that may be important to investors on its investor relations website at https://investors.goodrx.com. We intend to use our website as a means of disclosing material nonpublic information and for complying with our disclosure obligations under Regulation FD. Accordingly, investors and potential investors are encouraged to consult GoodRx’s website regularly for important information, in addition to following GoodRx’s press releases, filings with the Securities and Exchange Commission (the “SEC”) and public conference calls and webcasts. The information contained on, or that may be accessed through, GoodRx’s website is not incorporated by reference into, and is not a part of, this press release.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including, without limitation, statements regarding consumer savings; the benefits and value of GoodRx offerings to consumers, Kroger and GoodRx; GoodRx’s direct contracting approach; and GoodRx’s plans, expectations and objectives. These statements are neither promises nor guarantees, but involve known and unknown risks, uncertainties and other important factors that may cause GoodRx’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements, including, but not limited to, risks relating to GoodRx’s ability to achieve broad market education and change consumer purchasing habits, changes in medication pricing and pricing structures, GoodRx’s reliance on a limited number of industry participants, the competitive nature of GoodRx’s industry, and the important factors discussed in the section entitled “Risk Factors” in GoodRx’s Annual Report on Form 10-K for the year ended December 31, 2023, and GoodRx’s other filings with the Securities and Exchange Commission. These factors could cause actual results to differ materially from those indicated by the forward-looking statements made in this press release. Any such forward-looking statements represent GoodRx management’s estimates as of the date of this press release. While GoodRx may elect to update such forward-looking statements at some point in the future, GoodRx disclaims any obligation to do so, even if subsequent events cause GoodRx’s views to change.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240515290020/en/

Media Contact

press@goodrx.com

Source: GoodRx

FAQ

What is the new agreement between GoodRx and Kroger?

GoodRx and Kroger have signed a direct contracting agreement to offer enhanced prescription savings at over 2,200 Kroger pharmacy locations.

When will the new savings from the GoodRx and Kroger agreement start?

The new savings will start on June 1, 2024.

How much savings can patients expect with the new GoodRx and Kroger agreement?

Patients can expect almost 50% more savings on most generic medications.

How many Kroger pharmacy locations are included in the GoodRx agreement?

The agreement covers more than 2,200 Kroger pharmacy locations.

What stock symbol is associated with GoodRx?

The stock symbol associated with GoodRx is GDRX.