Ride-sharing giant Uber on Thursday took its first step into the prescription delivery market.
Uber's healthcare arm is working with NimbleRx, a startup that partners with independent and regional pharmacies to offer prescriptions through the startup's app or website and request same- or next-day home delivery direct to consumers.
A pilot will serve the Seattle and Dallas metropolitan areas, with Uber drivers delivering medications.
"Uber Health and NimbleRx have been discussing the partnership for a number of months and began piloting this spring," Dan Trigub, head of Uber Health, said in an emailed statement. "In a pandemic environment, getting to a pharmacy to pick up prescriptions can be challenging for many and nearly impossible for some, which heightened the need to roll out this partnership."
Uber and its main competitor, Lyft, have been pushing into healthcare with similar strategies for the past several years. Both initially focused on providing patients free and affordable rides to non-emergency medical appointments.
Americans increasingly get home delivery for their prescriptions, yet anecdotal accounts from patients and some evidence from pharmacy benefit managers about widespread U.S. Postal Service delays have exposed the pitfalls of prescription drug mail order services. Partnerships like NimbleRx's agreement with Uber Health could offer an alternative to mail order services, since it leverages Uber's network of drivers to shuttle prescriptions from local pharmacies to patients at home.
The companies will expand the drug delivery service to new markets in the next few months, Trigub wrote in a blog post.
For the prescription delivery partnership, NimbleRx integrated its platform with Uber Health, a business service that lets healthcare companies request non-emergency medical transportation. Uber said the platform is HIPAA compliant.
NimbleRx officials believe partnering with Uber Health will help them meet increased demand in the wake of COVID-19.
"Our partnership with Uber Health will allow Nimble to increase our capacity to serve our customers, and more efficiently deliver the prescriptions people need to address their health conditions," Talha Sattar, founder and CEO of NimbleRx, said in a statement.
NimbleRx has raised $60 million in funding to date. It was founded in 2014 as a direct-to-consumer pharmacy, but pivoted to working as a delivery service for independent pharmacies in 2018.
NimbleRx and Uber did not disclose financial details of their agreement. NimbleRx users pay a fee for delivery based on such factors as location, time and how quickly they're requesting the delivery.
While this partnership marks the first time Uber is delivering prescriptions, it's not the first time the company has delivered medications. In the wake of New York City's COVID-19 spike this past spring, the company piloted over-the-counter medication deliveries with startup Cabinet.
Uber's healthcare strategy largely has been to leverage its network of drivers and HIPAA-compliant Uber Health platform for "as many different healthcare verticals as possible," said He Wang, senior healthcare analyst at CB Insights, a firm that analyzes data on venture capital and startups. That makes Uber Health's new partnership "very consistent with their overall strategy."
Trigub in recent months had hinted Uber Health was considering moving into new healthcare segments, such as delivering healthy meals to people in food deserts, according to Wang.
The prescription delivery market is likely to grow, as consumers have been increasingly interested in the service on account of COVID-19, noted Rita Numerof, president of healthcare consulting firm Numerof & Associates.
It's a competitive market, including online pharmacy startups like Capsule and PillPack, which Amazon purchased in 2018, as well as pharmacy giants like CVS Health and Walgreens. Independent pharmacies have also partnered with courier services for deliveries, Numerof said.
Uber Health's partnership with NimbleRx represents "another player in a situation that's ripe for competition," Numerof said. "If the price point is such that it doesn't create a barrier, then this will take off."
Uber, which went public in May 2019, posted $2.2 billion in revenue for this year's second quarter, down 29% year-over-year as demand for ride-hailing services dropped amid the COVID-19 pandemic. The company posted a net loss of $1.8 billion, down from a reported net loss of $5.2 billion during the same period last year.
The company doesn't break out earnings for its Uber Health business but said the segment has grown 100% year-over-year.