GoodRx (GDRX) Morgan Stanley 22nd Annual Global Healthcare Conference summary

Strategic evolution and leadership

• New leadership has brought increased rigor, focus, and energy, emphasizing retail partnerships, hybrid contracting, and scaling manufacturer solutions.

• Strengthening the management team and focusing on key priorities has improved internal alignment and execution.

• The company has shifted from a founder-led approach to a more disciplined, priority-driven strategy.

Growth drivers and business model

• Growth targets of 6%-12% CAGR are driven by the prescriptions marketplace and pharma manufacturer solutions.

• Integrated Savings Program (ISP) is expanding, offering automatic price optimization for consumers and significant uptake among PBMs and plans.

• Pharma manufacturer solutions have grown from $17-18M in 2020 to nearly $100M, with unique offerings like point-of-sale discounts.

• Direct contracting with pharmacies now accounts for about 20% of client volume, up from 5% last year.

Profitability and capital allocation

• Adjusted EBITDA margins have improved to 32.5% in Q2 2024, up 400 basis points year-over-year, driven by top-line growth and cost efficiencies.

• Long-term margin targets exceed 35%, with limited need for additional capital investment and a focus on operating leverage.

• Capital allocation remains disciplined, with a high bar for M&A and $295M remaining for opportunistic share buybacks.