Free Market Health, a healthcare technology company announced a $20M Series B fundraise led by Questa Capital, a healthcare venture capital firm that invests in breakout growth companies, with participation from existing investors Alta Partners, Highmark Ventures, and 653 Investment Partners. New funds will be used to execute on significant business growth, launch channel partnership opportunities, and scale the company's care-driven marketplace platform. Ryan Drant, Founder and Managing Partner at Questa Capital, will join the company's Board of Directors.
A growing number of patients are taking specialty medications, and specialty drugs are becoming more expensive, with per member per year specialty drug costs anticipated to increase nearly 50% from 2022 to 2025, according to Pharmaceutical Strategies Group's 2023 State of Specialty Spend and Trend Report. With drug pricing under increasing regulatory and consumer pressure, the specialty drug management landscape is evolving rapidly.
"The specialty pharma industry is at a tipping point, and payers are seeking more control over how they manage their specialty pharmacy programs. We believe Free Market Health is a proven platform that adds significant value through price transparency, access, and individualized care. We are excited to partner with this experienced team and their solution which benefits everyone in the specialty pharmacy ecosystem, including and most importantly the patient managing serious and/or chronic disease," says Drant.
Free Market Health partners with payers on a new approach to their specialty drug management program. The Free Market Health platform drives efficiency, facilitates transparent and equitable access to specialty drug prescriptions for specialty pharmacies, ensures members are serviced by a pharmacy equipped to meet their unique needs, and lowers overall specialty drug spend through real-time market competition.
Since launching with Free Market Health in April 2021, leading managed care organization Highmark Wholecare has seen increased member access to their any willing specialty pharmacy network of varying types, sizes, and care models, with an even mix of health system pharmacies, community pharmacies, pharmacies that specialize in certain disease states, and large specialty pharmacies servicing its members. This diversity widens the spectrum of care models and pharmacy choices available to Highmark Wholecare members, who benefit from access to high quality specialty drug providers best suited to care for them. Driven by Free Market Health's technology orchestration and service model, the program is also improving member engagement. This value to members is best demonstrated by the 40% reduction in member abandonment of payer-authorized prescriptions. In addition, the relationship has generated an associated program savings of more than $2 PMPM. Free Market Health also partners with Highmark Wholecare parent company, Highmark Health, to support Highmark Health's commercial members on specialty medications.
"Free Market Health was founded with a mission to never let the process fail the patient, and our results to date coupled with this latest investment are validation that we are making a real difference," says Joe Cardosi, Founder and Chief Executive Officer at Free Market Health. "Our model stands out as a flexible solution operating at scale and well-positioned to help current and future innovative payer clients succeed in the evolving specialty pharmacy landscape."
Led by specialty pharmacy industry veterans, Free Market Health deeply understands the complexities of the specialty drug channel and is committed to improving the specialty pharmacy experience for all stakeholders. The company's platform currently manages more than 200,000 specialty drug claims annually, representing nearly a 400% increase year over year, through its partnerships with payers.
