Geoffrey and Matt Chaiken have an ambitious plan to lower the price consumers must pay for their prescription drugs. And they have enlisted the help of a prominent player who is an Amazon and Airbnb veteran to help achieve their mission through his insight into the interaction between consumers and technology: Vinayak Hegde is now the COO and president of the Chaiken brothers company, Blink. Health.
Although Blink made its announcement about Hegde’s appointment earlier this month, this is the first time Geoffrey Chaiken and Hegde himself have spoken to a media organization.
The prescription drug business is pretty strange. It’s a maze of supply chain components that are largely obscure and the consumer doesn’t really know what they will have to pay for. Out-of-pocket costs depend on your insurance and the various intermediaries, including Pharmacy Benefit Managers (PBMs), the pharmacies themselves, drug distribution companies, and all kinds of other players, who have the ability to increase prices. . The great irony is that everyone blames each other for, well, who is to blame.
What Blink Health has set out to do, as Fortune has already reported, is to avoid middlemen who make drugs more expensive. But in recent years, they’ve changed their strategy, Hegde and Chaiken tell Fortune, even taking advantage of the large market of Americans who have health insurance. In essence, they are looking to scale a business model, with a relatively limited audience, that the company claims can reduce prescription drug costs by as much as 80 percent.
It’s no secret that prescription drug costs in the US are among the highest in the world. Politicians ranging from President Donald Trump to former Democratic candidate Hillary Clinton and current Democratic candidate Joe Biden have vowed to take steps that will reduce the out-of-pocket costs Americans pay for their prescriptions. Some proposals, such as Trump and Biden’s recommendations that programs like Medicare have the power to directly negotiate drug prices, have been more aggressive than others. But none have actually been enacted.
Hegde has had an interesting transformation throughout her career. A 12-year veteran at Amazon and a tech professional at heart, he finally turned to business marketing. He was one of the heads of Groupon’s marketing group. At Airbnb, he was the chief marketing officer for the global housing business and was tasked with vice president of growth for the entire company.
What this adds to is: Hegde is a pupil of the supply and demand school, and how certain regions have very specific needs and, most significant to Blink, the ability to scale.
These systems may seem common today within e-commerce, but they form the backbone of digital health businesses. Turning an industry like prescription health care, which has historically been an in-person service system at, say, your local pharmacy, into a scalable yet convenient business requires knowledge of technology, logistics, and marketing.
While Blink started out serving those who were uninsured or didn’t want to use insurance to buy drugs, the new plan – and part of what Hegde was hired to drive – is expanding to a network of insured patients. . It all comes down to this: The nexus of e-commerce and direct delivery of generic and brand-name drugs could significantly lower costs for American patients, if they can crack the code.
