ZappRx Gets $1M From Atlas, SR One to E-Prescribe Specialty Meds

1/30/14Follow @benthefidler

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target retail pharmacies and low-cost meds. But in the process of fundraising and getting advisors around the table, everyone agreed that the product would be best suited for the specialty market, where the patient counts are smaller, the margins are higher, and the need for new options is greater.

This means ZappRx wants to implement its system to streamline the prescription process for drugs for serious conditions—and not just pills that you can pick up from a pharmacy (like oral HIV meds). Initially, for instance, ZappRx is looking at pulmonary arterial hypertension. Patients with it start out on high-priced oral pills, but can move on to infused, inhaled, or injectable therapies depending on the stage of the disease. The condition accounts for about 2 percent of the specialty market, Barry says.

“For a startup looking to tackle the marketplace, specialty is the ideal place to launch,” she says. “You’re not talking about pills. There’s a lot that goes into the order.”

Indeed, electronic medical records don’t currently handle specialty prescription orders, and the prescriptions themselves aren’t just a couple words scribbled by a doctor on a notepad.

Rather, each prescription is a three to five page document. Several pieces of supporting information, like lab results and diagnostics, are required. And patients often have to sign off on a monthly basis showing that they’re willing to take that medication. The result is some 50 pages of material required every month to process an order, done over fax, voicemails and phone calls between pharmacists, healthcare providers, and patients. Call centers are set up by the specialty pharmacies to keep patients apprised of when they’ll get their meds. It takes between 5 and 10 days on average to process the order, but can take much longer, according to Barry.

“It’s drastically different than your typical prescription,” she says. “It’s a very fragmented process.”

So ZappRx has designed a Website and mobile application that automates the whole process, essentially turning it into an “Amazon one-click” for such orders, she says. ZappRx automates all the redundant information seen on many of the forms, and provides portals for each party to input their information and communicate with one another. It also enables patients to see exactly where their prescription is in the order process. For providers, it’s a website that they’d log into that would be integrated into their prescription management systems. For patients, it would be a mobile app.

“You don’t see a platform that’s connecting all these players uniformly. That’s what we’re doing and that’s what’s unique,” she says.

Of course, turning this into a successful business is the big challenge. ZappRx’s isn’t trying to compete with the big specialty pharmacies. Instead, it plans to license its technology to them, which would appear to leave it with a small group of customers with a long sales cycle (the app would be free for patients). Barry says the company is in talks with the major specialty pharmacies that handle treatments for pulmonary arterial hypertension, but also insists the market is growing, in that other specialty pharmacies are looking to expand from one disease specialty to several others. ZappRx also wants to get drug manufacturers to sponsor the platform, and Barry noted that with SR One on board as an investor, it’s helping to accelerate talks on that front as well—“particularly in the pulmonary arterial hypertension niche,” she says.

ZappRx isn’t detailing what it’ll charge just yet, but it expects to have some deals in place soon. Pricing negotiations are ongoing, Barry says.

Ben Fidler is Xconomy's Deputy Biotechnology Editor. You can e-mail him at bfidler@xconomy.com Follow @benthefidler

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