As the COVID-19 pandemic has many patients turning to prescription delivery, on-demand pharmacy NowRx has raised $20 million in a new round of funding.
The round, which was raised by crowdfunding platform SeedInvest, brings NowRx’s total funding to about $30 million and gives the company a post-money valuation of $85 million, CEO Cary Breese said in an interview with Crunchbase News.
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NowRx is a full-service pharmacy that offers free same-day delivery. It accepts all major insurance plans, and patients can also opt to pay $5 for one-hour delivery.
To Breese, traditional large pharmacies aren’t efficient enough and rely heavily on foot traffic through aisles of candy, supplements, cosmetic and hygiene products to make money. But people don’t want to go into stores and wait in line anymore, especially not during the COVID-19 pandemic.
The company currently only operates in California (the Bay Area and Orange County), but it plans to use the funding to expand in the western United States. Phoenix, Nevada and Seattle are next on the list, Breese said.
It will also be using the funding to invest more in its technology platform. NowRx’s pharmacy management software, QuickFill, makes the prescription fulfillment process more efficient. For example, instead of having humans count out pills, robots do it.
“We’re going to continue to push our technology even further bringing out more efficiencies and automation as we grow into these other areas,” Breese said.
As for growth, the company has seen an 80 percent increase in new customers and revenue since the beginning of the year, Breese said. NowRx is on track to break even in its most mature market (Mountain View) by the fourth quarter of this year.
The round was oversubscribed, but since NowRx filed to raise up to $20 million it had to cap it at that amount, Breese said. It’s the largest round raised in SeedInvest history, according to NowRx.
“We considered VC funding as well. At the end of the day we are focused on customers first, the customer experience and we’ve seen too many companies raise too much money too quickly and really focus on rapid growth at all costs,” Breese said. “The old VC model of moving fast and breaking things just doesn’t work for health care.”
Illustration: Li-Anne Dias