Exclusive: RxDefine, now Ostro, raises $45M for health engagement
Ostro, recently rebranded from RxDefine, is getting an e-commerce makeover and $45 million in Series B funding, CEO Chase Feiger tells Axios exclusively.
Why it matters: Retail and finance companies are accustomed to having a wealth of user engagement and tracking tools at their fingertips, but that same innovation has been slow to come to health care.
Deal details: Founders Fund, Byers Capital, Caffeinated Capital, Greycroft, Bling Capital, Trust Ventures and RRE Ventures supplied the funding, tipping Ostro’s total capital to just over $55 million raised to date.
- Miami-based Ostro is using the funds to expand from selling three products to more than 10, Feiger says.
- Ostro's tools guide consumers and clinicians to treatments including medical devices, drugs, diagnostics and digital therapeutics.
- "We’re bringing e-commerce software to health care," says Feiger, who is also a physician.
Yes, and: Drugmakers and medical device developers have a limited time to market their tools because of patent regulations, underlining Ostro's value prop even amid a market slowdown.
How it works: Ostro signs software-as-a-service contracts with drug companies and developers of medical devices, digital therapeutics and diagnostics.
- Then it offers tools and information to consumers and clinicians to help guide them to an appropriate drug or device.
- Those tools include online chat and text-based functions powered by AI- and ML-driven software and patient-facing CRM tools that capture and anonymize patient information and respond to questions.
State of play: Publicly traded Veeva Systems, which has a market cap of $28.54 billion, is Ostro's most direct competitor, though Veeva mostly courts large and emerging biotech companies.
- There's also Epicor, which works with companies across the medical device, retail and automotive industries and in 2020 was acquired by Clayton and Dubilier & Rice through a $4.7 billion LBO.
Yes, but: When it comes to health care-specific companies like Ostro, there really aren't many.
- "It’s been a blue ocean for solutions like ours in the market," Feiger says.
What they're saying: Along with helping drugmakers and medical device manufacturers sell their products, Feiger says, his tools help patients access treatments sooner and more equitably.
- "We started the company so that regardless of your affiliation or institution you can learn about new treatment options," Feiger tells Axios. "And so that you don’t have to spend hundreds of hours doing research."
Where it stands: Ostro serves roughly 20 companies focused on specialties including neurology, cardiovascular disease, pulmonology, infectious disease and women’s health. Those companies and treatments include, per Axios' research:
- AstraZeneca, for its Breztri Aerosphere medication for COPD.
- CooperSurgical, for its Paragard IUD.
- Ortho Dermatologics, for its Jublia medication for toe fungus.
Be smart: Ethical considerations come into play when marketing medical products. Feiger says Ostro addresses them both in writing and in meetings.
- "When we meet marketing managers we make it clear we want to ethically drive patients towards getting the right treatment for them, which, by the way, might not be their treatment," Feiger says. "We’ve turned away at least four customers where that was not well understood by the company."
- Company policy also prohibits Ostro from serving any company with a Schedule 1 drug in its portfolio, from serving a portfolio that contains a Schedule 2 drug, and from providing its services for any Schedule 3 drug. (These are drugs with potential for abuse or addiction, like opiates or steroids.)
The bottom line: "I view my role as a physician and doctor first and foremost, before an entrepreneur," Feiger says.