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How Does GoodRx Make Money? GoodRx Business Model In A Nutshell

GoodRx is a healthcare platform that compares prices on thousands of medications by enabling consumers to get access to discounts. GoodRx makes money either through a fixed fee or commission as consumers complete the prescription transaction to the parter’s website or location. By 2019, GoodRx generated over $388 million, primarily through prescription transactions.

Business Model ElementAnalysisImplicationsExamples
Value PropositionGoodRx’s value proposition centers on providing a platform that helps consumers find and compare prescription drug prices, access discounts and coupons, and make informed choices about their healthcare. It offers cost-saving solutions, convenience, and transparency in healthcare expenses.Offers consumers a way to save on prescription medications. Enhances transparency in healthcare costs. Provides a user-friendly platform for comparing drug prices. Attracts individuals seeking affordable healthcare options. Empowers patients to make informed choices about their prescriptions.– GoodRx’s platform allows users to search for prescription drug prices at nearby pharmacies and access discounts and coupons. – Patients can receive significant cost savings on medications by using GoodRx’s services. – Users can compare drug prices, access coupons, and find pharmacies through the GoodRx app and website.
Customer SegmentsGoodRx serves a diverse customer base, including individuals with and without insurance, healthcare providers, pharmacies, employers, and payers. It caters to people seeking affordable prescription medications and healthcare cost management solutions.Addresses the needs of consumers with varying insurance situations. Offers services to healthcare providers and pharmacies for patient assistance. Attracts employers and payers interested in lowering healthcare costs. Supports individuals and families in managing healthcare expenses.– Individuals without insurance use GoodRx to access affordable prescription prices. – Healthcare providers may recommend GoodRx to patients seeking cost-effective medications. – Employers and payers may partner with GoodRx to offer prescription savings to their employees or beneficiaries.
Distribution StrategyGoodRx distributes its services primarily through its mobile app and website, making it easily accessible to users. It partners with pharmacies and healthcare providers to offer discounts and coupons at local brick-and-mortar locations. GoodRx also collaborates with employers and payers.Ensures widespread accessibility through digital platforms. Partners with pharmacies for in-store savings. Collaborates with employers and payers to expand its user base. Empowers users to find the most cost-effective prescription options.– Users can download the GoodRx app or visit the website to search for drug prices, discounts, and coupons. – GoodRx partners with pharmacies nationwide to offer discounted prescription prices to customers. – Employers and payers may include GoodRx as a benefit for their employees or members.
Revenue StreamsGoodRx generates revenue through various streams, including fees from pharmacy partners, subscription fees for its premium membership (GoodRx Gold), advertising revenue, and fees from employers and payers who offer GoodRx as a benefit to their employees or members. It also earns referral fees from pharmacy referrals.Diversifies income sources to sustain operations and growth. Earns revenue from pharmacy partnerships, subscription fees, and advertising. Attracts employers and payers seeking cost-effective healthcare solutions. Provides a free platform while offering premium membership options.– GoodRx earns fees from pharmacy partners when users redeem discounts and coupons at participating pharmacies. – Users can subscribe to GoodRx Gold for premium features and savings. – Advertising on the GoodRx platform generates revenue. – Employers and payers may pay fees to offer GoodRx to their populations.
Marketing StrategyGoodRx’s marketing strategy includes online and television advertising, partnerships with healthcare providers, pharmacy promotions, and an active online presence through social media and its blog. It focuses on promoting cost savings and healthcare transparency to attract users.Utilizes advertising to reach a broad audience and increase user awareness. Collaborates with healthcare providers and pharmacies for user referrals. Engages with users through social media and informative content. Promotes cost savings and transparency as key selling points.– GoodRx runs TV commercials and online ads to inform consumers about its services. – Healthcare providers and pharmacies may recommend GoodRx to patients to help them save on prescriptions. – GoodRx’s blog and social media channels provide educational content on healthcare costs and prescription savings.
Organization StructureGoodRx operates as a healthcare technology company with multiple divisions and business units, including partnerships, product development, marketing, and customer support. It employs a centralized organizational structure to oversee its operations and partnerships.Operates with a centralized structure to manage various functions efficiently. Employs specialized teams for partnerships, product development, and customer engagement. Focuses on innovation to enhance user experience and cost-saving opportunities. Engages with healthcare providers and pharmacies to expand its network.– GoodRx’s partnership team collaborates with pharmacies to offer discounts and coupons. – Product development teams work on enhancing the GoodRx app and website. – Customer support assists users with inquiries, account management, and prescription savings. – Marketing teams promote GoodRx’s services and engage with healthcare providers.
Competitive AdvantageGoodRx’s competitive advantage lies in its user-friendly platform for prescription savings, its extensive network of pharmacy partners, its focus on healthcare transparency, and its ability to serve a wide range of customers, including those with and without insurance. It also benefits from strong brand recognition.Provides a convenient and transparent solution for prescription cost savings. Attracts users with its broad pharmacy network and discounts. Serves a diverse customer base with varying healthcare needs. Maintains strong brand recognition in the healthcare cost management space.– GoodRx’s platform is known for its ease of use and transparency in displaying prescription prices and savings. – Its extensive network of pharmacy partners offers users access to discounts and coupons at numerous locations. – GoodRx caters to consumers with different insurance situations, offering affordable prescription options to a wide range of users.

Origin story

As Doug Hirsch recounts in the S-1 letter to shareholders, as he was still a kid, he got a piece of advice from his parents, that instead of focusing on finding a good job and salary, to focusing on finding good health insurance.

This sort of advice would be strange, if it wasn’t for the fact that is an all American story.

The complexity, opacity, and expansiveness of the healthcare system only became much more vivid as the GoodRx co-founders grew up. Doug Hirsch recounts of a specific experience back in 2010, when with prescription in hand and good health coverage, he still could not find a uniform and affordable prescription.

As he walked across several pharmacies, he realized that the healthcare market was just like any other industry. Prices would change slightly from one place to the other, with the difference though that the system’s complexity and opacity stood on the shoulders of American people who could not afford that.

From there, GoodRx was created. Whether or not the story is apocryphal, this is the story of a company that managed in a few years to become a leading platform that connects several key players in the healthcare space, offering a single, simplified interface to consumers.

While this might seem just a digital platform, in reality, the final interface (shown primarily as a price comparison tool) underlies key partnerships in the healthcare space, from healthcare providers to healthcare professionals and consumers. From this balance, this business model exists.

Mission, vision, and principles

GoodRx mission is to “help Americans get the healthcare they need at a price they can afford.”

This mission has been executed by the company’s digital platform, which goals is “to solve the challenges that consumers face in understanding, accessing, and affording healthcare.

From its beginnings as a price comparison tool for prescriptions, the platform expanded to offer several services (from prescriptions to Telehealth, and additional healthcare services).

GoodRx claimed guiding principle is that “of doing well for consumers and the healthcare industry as a whole.”

But how big is GoodRx potential market? How does its business model and distribution work? And how does it make money?

Let’s see.


The GoodRx estimated TAM, moving across three main healthcare areas (prescriptions, pharmaceutical manufactured solutions, and telehealth). Image Source: GoodRx S-1.

In its S-1 GoodRx estimates its total addressable market (TAM), in around $800 billion ($524 billion for prescription opportunity, $30 billion in pharmaceutical manufacturer solutions and $250 billion for telehealth).

It’s important to remark that the TAM is a highly speculative number, based on estimates and assumptions of how the market will evolve in the coming years. The TAM is a way for companies to show their potential opportunity in the future.

The assumption of this opportunity is based on GoodRx’s firm belief that consumers (thanks also to the web) have become more informed, and cost-conscious. That is why the market entry strategy that GoodRx used was thorough its price comparison tool. This was the entry point that enabled the company to grow and expand to several other areas and services (the latest move was in 2019 when GoodRx acquired HeyDoctor, the platform that would enable the company to further expand in the telehealth industry).

To understand GoodRx’s opportunity, it’s also important to start from the problems it solves and for whom they get solved.

Value proposition, key customers: the GoodRx three-sided marketplace

The American healthcare system is among the most complex ones, and many US citizens feel the pressure of having a good health insurance coverage if they want to guarantee a good lifestyle for themselves and their family in the long run. Indeed, for one thing, there is a trade off caused by the US healthcare system.

The health-related expenses not only are a continuous worry for most people in the US (unless of course, you have good coverage), many more ignore it altogether as they can’t afford to have it. The complex, expensive, and opaque nature of the healthcare American system has opened up massive opportunities for digital platforms.

As a consumer-facing platform, GoodRx has not only to provide a good service to a large number of potential patients, but it has also to attract healthcare professionals and companies to be present on the platform. This creates a three-sided marketplace with three core players/partners/stakeholders:

  • Consumers: they get easy access to the platform to find simpler and more affordable healthcare solutions. In addition, through the telehealth platform, people can access treatments that otherwise they wouldn’t have due to long wait times for in-person visits.
  • Healthcare professionals: motivated by the ability to help more patients, to get more exposure for their profession, and perhaps (especially during the COVID pandemic) to offer their diagnosis remotely, they join the GoodRx platforms (HeyDoctor is the telehealth platform).
  • And healthcare companies: they can get more exposure on a platform that counts millions of consumers, to offer more affordable solutions.

By balancing out the value propositions for these three players the marketplace tries to build a win-win-win experience for all.

How the GoodRx business model and platform work

GoodRx’s product/service/platform is divided into four main parts:

  • Prescription Offering.
  • Subscription Offerings.
  • Pharmaceutical Manufacturer Solutions Offering.
  • Telehealth Offerings.

Let’s dive into each part of the platform to understand its business model.


This is where it all started. GoodRx entered the market as a price comparison tool for prescriptions. Over the years, the company developed a proprietary technology, which as of 2020 aggregates over 150 billion prescription data points from many sources.

This data gets curated and presented back to consumers in the form of services on the platform, accessible on its mobile app, or website for free.

Above the GoodRx pricing comparison platform in action. Through the free mobile app or website, it’s possible to search, discover, and find pharmacies at discounted prices.
Image Source: GoodRx S-1.

This is the GoodRx’s pricing comparison workflow:

  • The consumer uses a GoodRx code to purchase a prescription.
  • The code gets recorded in the parter’s pharmacy database so that the consumer can purchase subsequently without showing the code again.
  • The consumer saves money as a result of the partnership between GoodRx and the pharmacy.
  • GoodRx makes money for the initial purchase and those afterward, via the GoodRx code (it earns a % on the sale of the prescription or a fixed fee).
  • The consumer on the GoodRx platform is incentivized to repeat purchases, as more discounted are presented and both the pharmacy and GoodRx make money as a result of that.

Where does GoodRx collect that data for its platform? Primarily through pharmacy benefit managers (PBMs), other sources include Pharmacies, Mail Order Pharmacies, Pharmaceutical Manufacturers Patient Assistance Programs, and Medicare.


By 2017, GoodRx launched its first subscription service, called Gold, and by 2018, it also launched Kroger Savings:

  • GoodRx Gold is simply a saving program with a monthly fee of $5.99 for individuals or $9.99 for families (up to five), which gives subscribers access to even lower prices for pharmacies participating in the GoodRx program.
  • Kroger Rx Savings Club powered by GoodRx: which is the fruit of the partnership between GoodRx and Kroger that for an annual fee of $36 for individuals or $72 for families (up to six) gives access to lower prescription prices at Kroger pharmacies.

Pharmaceutical Manufacturer Solutions

That includes:

  • Co-pay cards,
  • Patient assistance programs,
  • And other savings options.

GoodRx partners up with pharmaceutical manufacturers to advertise their solutions on the platform, while offering discounts to consumers which are eligible to those.


Telehealth has been among the fastest-growing industries in the healthcare space. Indeed, GoodRx launched in 2019, its Telehealth platform, HeyDoctor, coupled with the GoodRx Telehealth Marketplace, the aim is to attract third-party providers and expand the services offered on the platform.

GoodRx through HeyDoctor and its marketplace has both in-house healthcare providers and third-party providers. This offering well integrates with the prescription services. As consumers browse and find a healthcare professional on the platform, together with the diagnosis also a prescription might be matched:

Example of the user journey on the GoodRx’s HeyDoctor platform. Once on the landing page, the consumer finishes the intake interview, she/he gets identified and from there it starts a video chat with the healthcare professional. As the diagnosis is provided the consumer can choose between mail order and retail pharmacy, and also access the discovery interface to find its medications. As final steps, the consumer can choose the pharmacy and pick up the medication. Image Source: GoodRx S-1.

Technological model

Each tech company has a model that it follows which is built-in into its technology and that also comprises the philosophy of the organization. As a discovery, comparison platform whose goal is to enable variety, information and lower prices on medications, GoodRx follows these “technological principles:”

  • Proprietary Pricing Engine that links with multiple sources spanning the healthcare industry, which also collects and normalizes prices from multiple PBMs, it refines them, and it offers as a single user interface. This technological element is the key to GoodRx business model, as it is a consumer-facing interface, which needs to reduce complexity.
  • Constant Data Refresh: GoodRx employs predictive models and software programs to adjust the data on the platform in real-time to enable a continuous stream of discounts and offers on the platform.
  • Living Database: GoodRx remarks that its database is “living” as its dynamic, and it gets updated and refined continuously. This is another central element to a platform where it’s all about price, variety, and simplicity.
  • Artificial Intelligence / Machine Learning: GoodRx integrates algorithms that will learn from the prescribing habits of consumers. For instance, GoodRx’s engine might automatically show the dose of a given medication based on specific parameters.
  • Scalability: GoodRx leverages the cloud infrastructure of third-party services like Amazon AWS and Google Cloud Platform to enable its performance as it scales.

Revenue model

GoodRx revenues grew consistently in the last years, and with that also its operating and net income.
Number of monthly active consumers over the years. GoodRx reached over 4.4 million monthly active consumers by June 30, 2020.

By June 2020, GoodRx had over 4.4 million monthly active consumers, 15 million monthly visitors, with the GoodRx app among the most downloaded medical apps.

But how does GoodRx make money?


Prescription revenues (fixed and % based)

Most of the revenues (94% in 2019) come from prescriptions. In short, as consumers on the platform receive discounts, they get a code generated by GoodRx, this code identifies the consumers, which ones finalized the initial purchase and the subsequent ones it generates a commission on the sale for GoodRx.

For any platform, the key success element is to master the repeat transaction. And for GoodRx over 80% of transactions came from repeat prescriptions. The nature of this kind of transaction, where the consumer will either refill the existing prescription or fill a new prescription, makes the earnings of GoodRx stable and growing over time.

Indeed, once the code has been generated for the consumer, as more orders are placed those are traced back to the code, and the commission or fixed fee is paid back to the platform.

To gain some context, fixed fee arrangements generated 15% of GoodRx revenues in 2018, and 7% in 2019, and 2020.

Other revenue streams

Other revenues come from subscription offerings (Gold and Kroger Savings), pharmaceutical manufacturers/affiliates (advertising revenues), and Telehealth offerings. All in the US.

  • As a quick note for the advertising revenues. Advertisers (primarily pharmaceutical manufacturers) may purchase advertisements for a fixed fee or on a performance-basis. This advertisement will appear on the company’s website or app. In addition, GoodRx also serves advertisements through the company’s direct mailers. To gain some context, in 2020, a good chunk of the growth in other revenues (from $8.9 million to over $24 million in the first six months of 2019, vs. 2020) was driven by pharmaceutical manufacturers advertising on the platform (a $5.3 million increase).

Cost structure

We’ll look at three key items that make up the cost structure of GoodRx, from the cost of revenues, or what it takes to deliver the service in the first place, to product development (R&D) and sales, marketing and distribution:

  • Cost of revenuethose costs primarily relate to outsourced consumer support, healthcare provider costs for HeyDoctor, personnel costs for consumer support employees, hosting, and cloud costs. Those costs usually grow in proportion with the platform usage.
  • Product development and technology: it comprises product development activities, third-party services, and contractors related to product development, information technology, and software-related costs. Therefore, the headcount growth related to engineering for the platform’s continuous development is the main expense.
  • Sales and marketing: those comprise mainly the advertising and marketing expenses for consumer acquisition and retention. We’ll see more in detail how the distribution, sales, and marketing models work.

Distribution, Sales and Marketing models

GoodRx uses both paid, organic and viral marketing channels to reach consumers.

Organic channels comprise the traffic generated on the GoodRx website and apps. While viral growth comes from word-of-mouth coming from consumers referring friends and family, healthcare professionals and pharmacists, and press coverage which drives traffic back to the website and apps.

Organic and viral channels work well as they are low-priced marketing channels. GoodRx marketing mix also comprises direct to consumers’ marketing, partnerships, and content marketing.

Direct to Consumer Marketing

Direct to consumers channels comprise:

TV: GoodRx advertises on both traditional linear television as well as through digital streaming.

Paid Search: GoodRx buys advertising primarily through Google and Bing.

Examples of banner ads campaigns run through paid platform like Google Ads. Data Source: SEMRush.
Examples of Google ads campaigns that GoodRx runs. Those are performance-based campaigns, where GoodRx bids on paid keywords in exchange for clicks on the platform.
Data Source: SEMRush.


  • GoodRx provides in-office materials to healthcare professionals so that those professionals can amplify the brand and services available on the platform. In addition, GoodRx built an app (GoodRx Pro) for healthcare professionals to facilitate electronic prescriptions.
  • GoodRx also partners up with electronic health record providers (EHRs). Those are key withing the GoodRx workflow, as they are records of patients which comprise medical history, diagnoses, medications, treatment plans, and much more. By integrating pricing from GoodRx to the EHRs prescribing workflows healthcare professionals can provide prices from GoodRx straight at the point of prescription.
  • Affiliates: other partnerships like the one with the exclusive provider of prescription pricing to the American Automobile Association membership base are also part of the mix.

Content Development and Marketing

Content is an essential part of the platform and a website that brings in millions of organic visits per month. That is why the platform produces a continuous stream of content.

Examples of marketing funnels and key entry points for GoodRx distribution

Below are a few examples of how consumers get to know the GoodRx platform:

  • Word of Mouth: consumers’ referral is among the most important acquisiton channels for GoodRx. Consumers might invite other family members and friends, attracted by discounts on prescriptions.
  • Physician: in this workflow, once the consumer gets checked by the physician, if the physician determines that a medication is needed, it will check the pricing for the patient in the records (EHR) where GoodRx integrates its pricing. By finding more reasonable prices for the patient, that is how the connection is created. The patient will have the GoodRx code, which will be used to purchase also subsequent medications.
  • HeyDoctor Telehealth Consultation: once a consumer completes the consultation through the HeyDoctor platform if needed, lab tests can be booked through one of the partners of the platform, and a prescription, completed through the GoodRx platform.
  • GoodRx Marketing: GoodRx online ad, TV commercial visits the app or the website to complete the transaction and save money on prescriptions. Over several refills, GoodRx will prompt consumers to subscribe to one of the platform’s plans.

Key takeaways

  • GoodRx is a digital platform focused on offering price comparisons, and discounts for prescriptions. It also offers Telehealth consultations.
  • GoodRx partners up with physicians and healthcare companies to integrate its pricing. Once consumers can find GoodRx’s pricing comparisons, it gets easier for the platform to have them become loyal and repeat customers. Most of GoodRx’s revenues come from prescriptions’ transactions.
  • GoodRx also offers subscription plans (Gold and Kroger) which have become an essential part of the GoodRx offerings as they unlock additional savings and facilitate repeat transactions.
  • GoodRx also monetizes through advertising on the platform primarily driven by pharmaceutical manufacturers placements or performance-based campaigns.
  • Some of the key channels that drive GoodRx growth are word-of-mouth, partnerships, paid, and direct advertising.

Key Highlights

  • Origin Story: GoodRx was founded with the goal of helping Americans access affordable healthcare. The co-founders realized the complexity and opacity of the healthcare system, leading to the creation of a platform that provides price comparisons and discounts for medications.
  • Mission and Vision: GoodRx’s mission is to help Americans access healthcare they can afford. Their digital platform aims to solve challenges related to understanding, accessing, and affording healthcare services.
  • Market Opportunity: GoodRx estimates its Total Addressable Market (TAM) to be around $800 billion, covering prescriptions, pharmaceutical solutions, and telehealth. The TAM is based on the belief that informed and cost-conscious consumers will seek more affordable healthcare solutions.
  • Value Proposition: GoodRx operates a three-sided marketplace involving consumers, healthcare professionals, and healthcare companies. Consumers access affordable healthcare options, healthcare professionals gain exposure and can offer remote services, and companies get exposure to a wide consumer base.
  • Business Model: GoodRx’s platform is divided into four main parts: Prescription Offering, Subscription Offerings (e.g., Gold, Kroger Savings), Pharmaceutical Manufacturer Solutions Offering (e.g., co-pay cards), and Telehealth Offerings (HeyDoctor). They make money through prescription transactions, subscription fees, advertising from pharmaceutical manufacturers, and telehealth services.
  • Technology and Data: GoodRx employs a proprietary pricing engine that aggregates and normalizes prescription data from various sources. It uses AI and machine learning to enhance user experience and prediction models. The platform constantly updates and refines its data to provide accurate and real-time information.
  • Revenue Model: The majority of GoodRx’s revenue comes from prescription transactions, where they earn a commission or a fixed fee for connecting consumers with discounted prescriptions. They also generate revenue from subscription plans, advertising partnerships with pharmaceutical manufacturers, and telehealth services.
  • Cost Structure: GoodRx’s cost structure includes expenses related to delivering services (outsourced support, provider costs), product development and technology (engineering and software costs), and sales and marketing (consumer acquisition and retention efforts).
  • Distribution and Marketing: GoodRx uses a mix of organic, viral, and paid marketing channels. These include TV commercials, paid search, partnerships with healthcare professionals and providers, and direct-to-consumer marketing. Content development and marketing play a significant role in attracting and retaining users.
  • Key Growth Channels: Word-of-mouth referrals, physician partnerships, HeyDoctor telehealth consultations, and GoodRx’s own marketing efforts are key channels that drive growth and user engagement.

Related Facts

GoodRx is an American healthcare company known for its telemedicine platform and a website and mobile app that track prescription drug prices. As part of this service, the company makes drug coupons available for free to consumers. GoodRx was created by Trevor Bezdek, Doug Hirsch, and Scott Marlette. Hirsch, an early employee at both Yahoo and Facebook, got the idea for the company after picking up a prescription with private health insurance and still having to pay $450. Given the high variability in prices between different pharmacies, Hirsh went on a mission to make prescription drug prices more transparent and affordable for ordinary Americans. Revenue in the second quarter of 2021 amounted to $177 million with over 7.5 million app customers using the GoodRx app. While the company was the first to provide a comprehensive list of pharmacy drug prices, new players have entered the market. The rest of this article will be devoted to looking at the main GoodRx competitors.

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