In a sign that life sciences commercial success is growing locally, a pharmacy tech startup just raked in some new funding.
Free Market Health announced this morning that it had closed on $13.5 million in Series A financing. The Strip District-based company specializes in the development of marketplace platform for the specialty pharmacy industry. San Francisco-based Alta Partners is the lead investor in the round, which also included existing investors Highmark Ventures (the investment arm of local healthcare and hospital system giant Highmark Inc.) and 653 Investment Partners.
Specialty pharmacies work just like regular pharmacies in that they provide prescribed medications to patients who need them. But specialty pharmacies deal with the medications for rare or complex diseases and conditions that not as many people have, so those treatments aren’t kept in stock like other more common medications. And that difference causes disruptions and inefficiencies that Free Market Health is trying to resolve. Its platform brings together all of the stakeholders in the process — patients, specialty pharmacies and payers — to streamline the medication fulfillment process.
“From delays in prior authorization requests to uncertainty on the best fit specialty pharmacy and medication pricing variability, the existing specialty pharmacy ecosystem fails to do what it’s meant to do: efficiently deliver lifesaving and life-altering medications into the hands of patients,” said Joe Cardosi, founder and CEO of Free Market Health, in a statement. “Our mission is to ensure the specialty medication referral and reimbursement process never fails the patient, and we’re thrilled to have support from innovative and passionate investors like Alta Partners, Highmark Ventures and 653 Investment Partners.”
Free Market Health could not immediately be reached for comment about its specific growth and hiring plans, as well as its place within Pittsburgh’s tech ecosystem. We’ll update this story if we hear back.
Founded in 2019, the company kept a low profile in its first few years of operation, but secured a deal for its platform with Highmark in July 2021 and has since grown its team to 40 employees. Through that partnership and others aimed at matching specialty medication referrals and pharmacies more quickly, the company said it’s lowered the rate of medication abandonment by 36%.
“Our collaboration with Free Market Health means that Highmark members will enjoy quicker access to prescription drugs for chronic, high-cost health conditions, from specialty pharmacies tailored to serve their particular condition,” said Sarah Marche, SVP of pharmacy services for Highmark Inc. “By removing pain points in the specialty pharmacy process for patients and providers alike, we’re promoting better clinical care and outcomes for our members. Working with Free Market Health advances our goal of transforming the pharmacy experience for our members and ensuring they have access to proven, affordable prescription drugs that help them be at their best.”
Other reports on the news indicated that reimbursements and referrals for specialty drugs make up half of Highmark’s expenditures for prescription drugs.
Free Market Health’s Series A comes after a banner quarter for Pittsburgh VC deals. While life sciences and healthcare-related deals were a big trend in the 2021 venture capital data, this is one of the first more significant raises in that sector so far this year. The raise, plus the contributions from Highmark within it, signal what could be the beginnings of an institutional move toward life sciences commercialization — a longtime challenge for Pittsburgh’s economy. By leveraging existing expertise with an innovation mindset, Free Market Health will join the growing rank of Pittsburgh companies looking to capitalize in the life sciences.
Sophie Burkholder is a 2021-2022 corps member for Report for America, an initiative of The Groundtruth Project that pairs young journalists with local newsrooms. This position is supported by the Heinz Endowments.-30-