At just over a year old, Wellesley-based Scripta Insights, a health tech startup that exists to lower the cost of pharmacy benefits, sees a real market opportunity amid coronavirus.
The startup's flagship software is a tool called Script.AI, which uses artificial intelligence to identify where companies are overpaying for their employees' pharmaceutical benefits. Scripta Insights works directly with employers to find those spots, which altogether can add up to an unnecessary 46 percent increase in the price of pharmacy benefits, the company says.
"We essentially take their bill every month—it might be 1 or 2 million documents each month, which essentially consist of lines and lines of deidentified employee data, the name of a drug I can't pronounce and the amount it costs," CEO Eric Levin said. "Most of the time, the company just pays it."
Scripta can recommend cost-saving alternatives that are identical to the prescribed medication. Levin cited an example from his own life. He was prescribed the allergy medication Dymista, a nasal spray consisting of azelastine and fluticasone. His pharmacist told him the drug would cost him $420, even after insurance, but there was a workaround: Levin could ask his doctor to write him two separate prescriptions, one for azelastine and one for fluticasone, and he would only have to pay $32.
"It's the exact same drug. You just take them separately," Levin said. "There's complete opacity. No one really understands the cost of the drug."
That opacity is what led to the creation of Scripta to begin with. The company started as a project of Paul and Mindy Bradley, a couple in Savannah, Georgia. Paul, a doctor, was repeatedly frustrated by the cost of prescription drugs—and the lack of insight he as a doctor had into what his patients were paying. The divide between health insurance companies and the day-to-day operations of physicians obscured the price. Mindy, a CPA, worked with her husband and other physicians to build strategies to save patients money on prescriptions and code those strategies into a database, which eventually became Script.AI.
A few years ago, Levin and his business partner met with the Bradleys and realized that Script.AI was powerful enough to form the backbone of a standalone company.
"We realized that if we spun it out, there was opportunity to make a huge dent in this market and lower the cost of drugs for people in America," Levin said, and shortly after, Scripta Insights was established in Massachusetts. "It made sense, as we were ramping up the technology solution, to move it to Boston and have access to the great networks here. It’s been a tremendous move."
Now, with companies looking to cut costs as the coronavirus takes its toll on the economy, Levin thinks Scripta's software is especially relevant.
Investors seem to agree. Last Friday, Scripta closed the second tranche of its first institutional funding round. The company isn't yet disclosing the amount of the round—Levin said he plans to fold the funding news into its next big customer announcement—but investors include Pillar VC and Pleasant Bay Capital Partners in Boston, as well as Contour Venture Partners in New York.
Over the next six months, Scripta will continue refining its machine learning software to make its system faster and more efficient. From there, it will build out its customer base, with the company "starting to see sales break loose" in Q3 and Q4, Levin said.
"We’re in the health care cost containment space. In the difficult economy, I would argue that we have even more opportunity than we did in a pretty robust economy," Levin said. "In a time where everyone is trying to avoid budget crunches, we’re really trying to avoid waste."
