GoodRx Jumps in Debut After $1.14 Billion IPO Surpasses Goal
(Bloomberg) -- GoodRx Holdings Inc., which operates a telemedicine site and online marketplace for discounts on prescription drugs, rose 53% in its trading debut after exceeding the target on its U.S. initial public offering.
Shares of the Santa Monica, California-based company closed at $50.50 in New York trading Wednesday, giving the company a market value of $19.4 billion.
The company and its investors raised $1.14 billion selling 34.6 million shares on Tuesday for $33 apiece after marketing them for $24 to $28. The shares opened at $46 and rose as much as 57% from the IPO price.
GoodRx was originally founded to enable consumers to shop for the best prices on prescription drugs, which can vary widely pharmacy to pharmacy as well as between brand names and generics. The idea wasn’t to sell the drugs, but instead direct consumers to the drugstore with the best deal and offer coupons.
A year ago, the company acquired the startup HeyDoctor LLC, giving it a toehold in the growing business of providing medical care over the internet.
GoodRx was started in 2011 by Facebook veteran Doug Hirsch and software entrepreneur Trevor Bezdek. Hirsch, now co-chief executive officer with Bezdek, said the company plans to use the IPO proceeds to get its product to more people.
“The problem of health care in America is getting so much bigger so much faster,” Hirsch said. “Fifteen million people a month come to our product and that is not enough.”
Demand for telehealth has surged during the coronavirus pandemic, which has forced patients to seek alternatives to the physical trips to a doctor’s office when possible.
The company earned $55 million in the first half of this year, up from $31 million during the same period in 2019, according to its filings. Revenue for the first half of 2020 was $257 million, up from $173 million in the first half of last year.
Whether the telehealth boom will continue when more businesses reopen is still a question.
“We went from zero to a hundred in telehealth and I think we’re going to settle at 60,” Hirsch said. “Telehealth will not be the end-all-be-all of health care.”
GoodRx’s offering was led by Morgan Stanley, Goldman Sachs Group Inc., JPMorgan Chase & Co. and Barclays Plc. The shares are trading on the Nasdaq Global Select Market under the symbol GDRX.
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