Specialist
Former director at Capsule Corp (Capsule Pharmacy)
Agenda
- Trends and developments in the digital pharmacy sector, focusing on Capsule
- PBM (pharmacy benefit manager) relationships and pain points from bricks-and-mortar pharmacy ownership
- Bricks-and-mortar pharmacy component and advantages to building patient trust and brand equity
- Competitive positioning vs Amazon's (NASDAQ: AMZN) PillPack, Alto Pharmacy, Medly Pharmacy and Mark Cuban's upstart Cost Plus
- 2022 outlook – potential strategic exits and growth trajectory
Questions
1.
What major trends and developments have you been following in the e-pharmacy and prescription delivery space over the past year or so?
2.
How has Capsule’s story evolved over the past several years in light of the dynamics you mentioned? What makes it unique from other e-pharmacy start-up players?
3.
What growth rate do you anticipate for the e-pharmacy and prescription delivery market over the next 5-7 years? Do you think a 20% CAGR is realistic? What factors will markedly influence whether this growth clip is attainable?
4.
How has the transition to telehealth shifted consumer attitudes and the operating environment for e-pharmacy and prescription delivery players? How are e-pharmacy companies adapting their business models to better integrate with telemedicine providers and take advantage of those industry tailwinds?
5.
What are common hurdles when trying to scale businesses such as Capsule nationally from just the New York City market? What is the company doing to manage some of these scalability challenges?
6.
Could you discuss Capsule’s relationships with PBMs [pharmacy benefit managers], including any notable pain points to securing reimbursement for prescriptions? Is there any friction from retail pharmacy ownership of PBMs? I appreciate there has always been an unstated firewall between pharmacies and their PBM arms, but how does that manifest in reality?
7.
What’s important to understand about the referral pathway from providers and how this plays into Capsule’s patient recruitment strategy? What is the company doing to strengthen its provider relationships and solidify some of these referral pathways?
8.
How do you assess Capsule’s organic patient acquisition and marketing efforts? What are the keys to building a trusted consumer brand and minimising CAC [customer acquisition cost]? Anecdotally, the company does a lot of advertising on yellow taxis in New York City among other D2C campaigns. How effective are these efforts?
9.
What’s the strategy behind Capsule offering completely digital prescription delivery, but also some bricks-and-mortar pharmacy locations in New York? What the net-net value-add to cost profile for in-person locations?
10.
How is the rise of discount cards and digital pharmacy solutions companies such as GoodRx impacting e-pharmacy and prescription delivery names such as Capsule?
11.
How do you assess Capsule’s app interface and user-friendliness? How important is UI/UX to building brand equity and customer stickiness on the platform? How differentiated would you say Capsule is in this area?
12.
How do you assess Capsule’s overall go-to-market strategy and expansion efforts? What primary factors does the company evaluate when deciding whether it can be successful entering a new market? Does it look at a densely populated area with a high proximity of patients with ability to pay or are there other important considerations here?
13.
How do you assess Capsule’s ability to manage delivery and logistical costs, especially amid macroeconomic inflation and spiking gas prices? How detrimental are these increases to the company’s bottom-line?
14.
Could you expound on Capsule’s relative differentiation from other e-pharmacy start-ups, such as Alto, Medly and others? How is Capsule differentiated in terms of the on-demand business model, tech offerings and market share?
15.
Could you juxtapose the Capsule on-demand model vs a mail-order offering, such as Amazon’s PillPack? How much or little competitive overlap do you see between these two names?
16.
What are your thoughts on Cost Plus, Mark Cuban’s start-up, which claims to cut out PBMs and apply a simple 15% upcharge on prescription costs?
17.
Could you discuss shifting consumer attitudes and the increasing focus on patient privacy and sensitive data collection as it relates to e-pharmacies? How might these tensions affect consumer decisions around who they choose to fill prescriptions?
18.
How much value is there in cross-selling retail shopping with prescriptions in a delivery option? Is that a viable moat for a CVS or a Walgreens to protect their foot traffic and prescription volumes?
19.
Where do you see Capsule’s business heading over the next several years? Could the company be an attractive acquisition target for an outsider such as Walmart or a big tech company? What might be some scenario-exit opportunities for the company?
20.
Is there anything we haven’t discussed about Capsule that might be especially important to highlight?
