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What changed in GoodRx Holdings, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of GoodRx Holdings, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+367 added−384 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-29)

Top changes in GoodRx Holdings, Inc.'s 2024 10-K

367 paragraphs added · 384 removed · 272 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe believe this market opportunity is substantial and estimate the total addressable market ("TAM") for our primary solutions to be between $534 billion and $607 billion. This includes a $515 billion to $588 billion prescription opportunity, which is inclusive of our estimated value of prescriptions that are written but not filled, and a $19 billion pharma manufacturer solutions opportunity.
Biggest changeThis includes a $581 billion to $691 billion prescription opportunity, which is inclusive of our estimated value of prescriptions that are written but not filled, and a $19 billion pharma manufacturer solutions opportunity. Prescription Opportunity We started our business with a focus on the U.S. prescriptions market. The majority of the utilization of our platform relates to generic medications.
Pharma Manufacturer Solutions Offering Brand medications tend to be expensive, and insurance coverage is complicated and may be restrictive. As a result, many consumers are not able to access or afford these medications. Pharma manufacturers provide affordability solutions such as co-pay cards, patient assistance programs, care portals and other savings options so that consumers can access their medications.
Pharma Manufacturer Solutions Offering Brand medications tend to be expensive, and insurance coverage is complicated and may be restrictive. As a result, many consumers are not able to access or afford their medications. Pharma manufacturers provide affordability solutions such as co-pay cards, patient assistance programs, care portals and other savings options so that consumers can access their medications.
We acquire new consumers through a variety of channels, including: (i) direct to consumer marketing which includes TV, paid search or other digital campaigns; (ii) marketing through healthcare partnerships which includes marketing materials in physician offices and integrating pricing from our platform into EHR providers' prescribing workflows so that healthcare professionals can provide prices from our 10 Table of Contents platform to their patients at the point of prescribing; (iii) marketing through partnerships with other affiliates to distribute our discounts and solutions to a broader target audience outside of the healthcare ecosystem; and (iv) through content creation which increases traffic to the GoodRx apps and websites such as from GoodRx Health, which provides visitors with thousands of articles with research-backed answers to health questions and provides us with more opportunities to convert visitors to active consumers.
We acquire new consumers through a variety of channels, including: (i) direct to consumer marketing which includes TV, paid search or other digital campaigns; (ii) marketing through healthcare partnerships which includes marketing materials in physician offices and integrating pricing from our platform into EHR providers' prescribing workflows so that healthcare professionals can provide prices from our platform to their patients at the point of prescribing; (iii) marketing through partnerships with other affiliates to distribute our discounts and solutions to a broader target audience outside of the healthcare ecosystem; and (iv) through content creation which increases traffic to the GoodRx apps and websites such as from GoodRx Health, which provides visitors with thousands of articles with research-backed answers to health questions and provides us with more opportunities to convert visitors to active consumers.
This price comparison platform processes over 320 billion pricing data points every day and integrates that data into a user-friendly interface which provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices through GoodRx codes that can be used to save money on prescriptions across the United States.
This price comparison platform processes over 360 billion pricing data points every day and integrates that data into a user-friendly interface which provides consumers with curated, geographically relevant prescription pricing, and access to negotiated prices through GoodRx codes that can be used to save money on prescriptions across the United States.
To date, no PBM 8 Table of Contents has terminated a relationship with GoodRx, Inc., which highlights the strength of our relationships alongside the value we deliver. ◦ Pharmacies: With GoodRx, pharmacies can reduce ‘walk away’ patients and prescriptions abandoned at the counter due to high cost, and can also increase overall sales through additional foot-traffic.
To date, no PBM has terminated a relationship with GoodRx, Inc., which highlights the strength of our relationships alongside the value we deliver. 9 Table of Contents ◦ Pharmacies: With GoodRx, pharmacies can reduce ‘walk away’ patients and prescriptions abandoned at the counter due to high cost, and can also increase overall sales through additional foot-traffic.
Industry Challenges Despite the approximately $4.5 trillion U.S. healthcare market being one of the largest sectors of the U.S. economy, it remains opaque and highly fragmented for consumers. Even simple healthcare transactions, such as finding a doctor or filling a prescription at an affordable price, are often difficult.
Industry Challenges Despite the approximately $4.9 trillion U.S. healthcare market being one of the largest sectors of the U.S. economy, it remains opaque and highly fragmented for consumers. Even simple healthcare transactions, such as finding a doctor or filling a prescription at an affordable price, are often difficult.
To read more about our approach to privacy laws and the regulations, please see Part I, Item 1A, “Risk Factors—Risks Related to Our Business—Actual or perceived failures to 14 Table of Contents comply with applicable data protection, privacy and security, advertising and consumer protection laws, regulations, standards and other requirements could adversely affect our business, financial condition and results of operations.” State Licensing Requirements Certain states have enacted laws regulating companies that offer and market discount prescription drug coupons and/or medical services.
To read more about our approach to privacy laws and the regulations, please see Part I, Item 1A, “Risk Factors—Risks Related to Our Business—Actual or perceived failures to comply with applicable data protection, privacy and security, advertising and consumer protection laws, regulations, standards and other requirements could adversely affect our business, financial condition and results of operations.” State Licensing Requirements Certain states have enacted laws regulating companies that offer and market discount prescription drug coupons and/or medical services.
Our competitors vary in size and breadth of their offerings. • In prescriptions discounts and price comparisons, our competition is fragmented and consists of competitors that are both larger and smaller than us in scale, including large e-commerce companies. 12 Table of Contents • Our pharma manufacturer solutions offering competes for advertising and market access budget allocation against platforms on which manufacturers can reach consumers, including health-related websites and mobile apps, and services supporting patient access.
Our competitors vary in size and breadth of their offerings. • In prescriptions discounts and price comparisons, our competition is fragmented and consists of competitors that are both larger and smaller than us in scale, including large e-commerce companies. • Our pharma manufacturer solutions offering competes for advertising and market access budget allocation against platforms on which manufacturers can reach consumers, including health-related websites and mobile apps, and services supporting patient access.
We believe we can drive significant growth in our prescription opportunity through our ability to continue to provide attractive prescription pricing to consumers. 7 Table of Contents Pharma Manufacturer Solutions Opportunity Brand medications tend to be expensive, and insurance coverage is complicated and may be restrictive.
We believe we can drive significant growth in our prescription opportunity through our ability to continue to provide attractive prescription pricing to consumers. 8 Table of Contents Pharma Manufacturer Solutions Opportunity Brand medications tend to be expensive, and insurance coverage is complicated and may be restrictive.
We plan to continue to expand the number of pharma manufacturers with which we work, increase brand penetration, and increase the number of solutions each of them uses, as well as enhance our existing offerings and introduce new integrated technology solutions that will allow manufacturers to interact with our consumer base more effectively. ◦ Subscription Offerings: We believe our subscription offerings, and our Gold subscription offering in particular, have higher lifetime value than our prescription transactions offering.
We plan to continue to expand the number of pharma manufacturers with which we work, increase brand penetration, and increase the number of solutions each of them uses, as well as enhance our existing offerings and introduce new integrated technology solutions that will allow manufacturers to interact with our consumer base more effectively. ◦ Subscription Offerings: We believe our subscription offerings, and our Gold subscription offering in particular, have higher l ifetime value than our prescription transactions offering .
As we continue to build our brand, we anticipate that many of the consumers who do not fully understand prescription pricing, or that are not aware of tools such as our platform, will begin using our platform. • Invest in Product Offerings: We plan to continue to invest in and scale our range of product offerings to better address the needs of consumers, provide them with better pricing, and improve their overall healthcare journey.
As we continue to build our brand, we anticipate that many of the consumers who do not fully understand prescription pricing, or that are not aware of tools such as our platform, will begin using our platform. 12 Table of Contents • Invest in Product Offerings: We plan to continue to invest in and scale our range of product offerings to better address the needs of consumers, provide them with better pricing, and improve their overall healthcare journey.
Even if a contract with a PBM were to be terminated, many of our contracts require the PBM to continue to pay us for activity by consumers originally directed to their pricing by us, even subsequent to the contract termination.
E ven if a contract with a PBM were to be terminated, many of our contracts require the PBM to continue to pay us for activity by consumers originally directed to their pricing by us, even subsequent to the contract termination.
We believe that this will result in higher consumer satisfaction and be accretive to our consumer lifetime value and to our margins in the medium to long term, without significant additional consumer acquisition costs. • Continue to Build the GoodRx Brand: We believe that there are significant opportunities to increase awareness and educate healthcare consumers regarding prescription pricing, as well as our platform and 11 Table of Contents solutions.
We believe that this will result in higher consumer satisfaction and be accretive to our consumer lifetime value and to our margins in the medium to long term, without significant additional consumer acquisition costs. • Continue to Build the GoodRx Brand: We believe that there are significant opportunities to increase awareness and educate healthcare consumers regarding prescription pricing, as well as our platform and solutions.
We have and may in the future offer incentives to certain consumers that further reduce discounted prices offered on our platform for a limited time and on a limited number of prescription drugs to attract new and re-engage existing consumers.
We have and may in the future offer incentives to certain consumers that further reduce 11 Table of Contents discounted prices offered on our platform for a limited time and on a limited number of prescription drugs to attract new and re-engage existing consumers.
For further information please see Part I, Item 1A, “Risk Factors—Risks Related to the Healthcare Industry—The impact of recent healthcare reform legislation and other changes in the healthcare industry and in healthcare spending on us is currently unknown, but may adversely affect our business, financial condition and results of operations.” Additional Information GoodRx Holdings, Inc., a Delaware corporation, was incorporated in September 2015.
For further information please see Part I, Item 1A, “Risk Factors—Risks Related to the Healthcare Industry—The impact of healthcare reform legislation and other proposed or future changes impacting the healthcare industry and healthcare spending on us is currently unknown, but may adversely affect our business, financial condition and results of operations.” Additional Information GoodRx Holdings, Inc., a Delaware corporation, was incorporated in September 2015.
Such regulations include the CAN-SPAM Act, the Telephone Consumer Protection Act of 1991, the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (together with their implementing regulations, collectively, “HIPAA”), Section 5(a) of the Federal Trade Commission Act, certain state data privacy and security laws, including, but not limited to, the California Consumer Privacy Act (“CCPA”), as amended by the California Privacy Rights Act (“CPRA”) and the Virginia Consumer Data Protection Act.
Such regulations include the CAN-SPAM Act, the Telephone Consumer Protection Act of 1991, the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act (together with their implementing regulations, collectively, “HIPAA”), Section 5(a) of the Federal Trade Commission Act, certain state data privacy and security laws, including, but not limited to, the California Consumer Privacy Act, as amended by the California Privacy Rights Act (collectively, “CCPA”), Washington State My Health My Data Act and other state data privacy and security laws.
We believe that the prices available through our platform are highly competitive, for both insured and uninsured consumers, and our platform enables consumers to save on prescription medications regardless of whether the consumer is insured or not.
We also enable consumers to save on brand medications. We believe that the prices available through our platform are highly competitive, for both insured and uninsured consumers, and our platform enables consumers to save on prescription medications regardless of whether the consumer is insured or not.
This results in high and increasing repeat activity, which refers to the second and later use of our discounted prices by a single GoodRx consumer, on our platform. We track prices and update our database on a daily basis, which helps ensure that consumers have access to accurate prescription pricing.
This results in high repeat activit y, which refers to the second and later use of our discounted prices by a single GoodRx consumer, on our platform. We track prices and update our database on a daily basis, which helps ensure that consumers have access to accurate prescription pricing.
Even as the 9 Table of Contents mix has changed, we have continued to grow the number of pricing data points processed by our platform and deliver a strong value proposition to our consumers.
Even as the mix has changed, we have continued to grow the number of pricing data points processed by our platform and deliver a strong value proposition to our consumers.
We work with more than a dozen PBMs that maintain cash networks and prices, and the number of PBMs we work with has significantly increased over time, limiting the extent to which any one PBM contributes to our overall revenue; however, we may not expand beyond our existing PBM partners and the number of our PBM partners may even decline.
We work with dozens of PBMs that maintain cash networks and prices, and the number of PBMs we work with has significantly increased over time, limiting the extent to which any one PBM contributes to our overall revenue; however, we may not expand beyond our existing PBM partners and the number of our PBM partners may even decline.
We have steadily increased the number of PBMs with which we work over time. To date, no PBM has terminated a relationship with GoodRx, Inc.
We h ave steadily increased the number of PBMs with which we work over time. To date, no PBM has terminated a relationship with GoodRx, Inc.
Pharma manufacturers provide affordability solutions, such as co-pay cards, patient assistance programs and other savings options, so that consumers can access their medications. We partner with pharma manufacturers to advertise and integrate these affordability solutions into our platform.
Pharma manufacturers provide affordability solutions, such as co-pay cards, patient assistance programs including point-of-sale discount programs, and other savings options, so that consumers can access their medications. We partner with pharma manufacturers to advertise and integrate these affordability solutions into our platform.
While we are currently focused on scaling our existing offerings, we see attractive opportunities to deploy our expertise in markets such as clinical trials, insurance marketplaces, in person doctor visits and prescription delivery, differentiated features and services for healthcare providers such as our enhanced Provider Mode released in 2022, as part of our GoodRx for Providers platform initially launched in 2021, that provides healthcare providers with a more customized experience and tools to support patients throughout their healthcare journey, among others.
While we are currently focused on scaling our existing offerings, we see attractive opportunities to deploy our expertise in markets such as clinical trials, insurance marketplaces, in person doctor visits and prescription delivery, differentiated features and services for healthcare providers such as our Provider Mode platform that provides healthcare providers with a more customized experience and tools to support patients throughout their healthcare journey, among others.
We collect and may use personal information to help run our business (including for analytical and marketing purposes) and to communicate and otherwise reach our consumers. In some instances, we may use third party service providers to assist us in the above. We endeavor to treat our consumers’ data with respect and maintain consumer trust.
We collect and may use personal information to help run our business (including for analytical and marketing purposes) and to communicate and otherwise reach our consumers. In some instances, we may use third party service providers to assist us in the above.
In addition, the patient can sign up for ongoing savings alerts related to that medication. We believe our trusted brand, large volume of high intent consumers and easy-to-use interface make our platform highly attractive to pharma manufacturers. These solutions generally increase medication awareness, access and adherence and can lead to faster treatment and better patient outcomes.
We believe our trusted brand, large volume of high intent consumers and easy-to-use interface make our platform highly attractive to pharma manufacturers. These solutions generally increase medication awareness, access and adherence and can lead to faster treatment and better patient outcomes.
At our Investor Relations website, investors.goodrx.com, we make available free of charge a variety of information for investors, including our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the SEC. 15 Table of Contents Our Code of Business Conduct and Ethics applies to all of our directors, officers and employees, including our principal executive officer and our principal financial officer.
At our Investor Relations website, investors.goodrx.com, we make available free of charge a variety of information for investors, including our Annual Report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and any amendments to those reports, as soon as reasonably practicable after we electronically file that material with or furnish it to the SEC.
Our subscription offerings are designed to be easy to use and provide subscribers with added benefits and features, such as increased discounts on prescription prices, discounted virtual care visits, and free home delivery on eligible medications. • Gold: We offer a subscription savings program whereby subscribers generally pay a monthly or annual fee for access to even lower prices in select participating pharmacies amongst other benefits, including a mail delivery feature. • Kroger Savings: We partner with Kroger, one of the largest retail pharmacies in the United States, to offer a tailored subscription product to Kroger consumers for an annual fee, a portion of which we share with Kroger.
Our subscription offerings are designed to be easy to use and provide subscribers with added benefits and features, such as increased discounts on prescription prices, discounted virtual care visits, and free home delivery on eligible medications. • Gold: We offer a subscription savings program whereby subscribers generally pay a monthly or annual fee for access to even lower prices in select participating pharmacies amongst other benefits, including a mail delivery feature. • Partnership Subscriptions : From time to time, we may partner with retailers to offer tailored subscription products.
We believe that our sources of pricing are sufficiently broad and robust that the loss of any one PBM or other healthcare partner would generally result in minimal disruption in our ability to provide competitive discounts and pricing. Although the majority of our pricing information comes from PBMs, we also collect pricing data points from other sources.
We believe that our sources of pricing are sufficiently broad and robust that the loss of any one PBM or other healthcare partner would generally result in minimal disruption in our ability to provide 10 Table of Contents competitive discounts and pricing.
If we are unable to retain favorable contractual arrangements with our PBM partners, including any successor PBMs should there be further consolidation of PBMs, we may lose them as customers, or the negotiated rates provided by such PBMs may become less competitive, which could have an adverse impact on our platform.
If we are unable to retain favorable contractual arrangements with our PBM partners, including any successor PBMs should there be further consolidation of PBMs, we may lose them as customers, or the negotiated rates provided by such PBMs may become less competitive, which could have an adverse impact on our platform. 13 Table of Contents A limited number of PBMs generate a significant percentage of the discounted prices that we present through our platform and, as a result, we generate a significant portion of our revenue from contracts with a limited number of PBMs.
Starting in 2023, we commenced operation of our integrated savings programs, which integrates our competitive discounts and pricing in a seamless experience at the pharmacy counter for eligible plan members served by certain PBM partners.
Although the majority of our pricing information comes from PBMs, we also collect pricing data points from other sources. Starting in 2023, we commenced operation of our integrated savings program, which integrates our competitive discounts and pricing in a seamless experience at the pharmacy counter for eligible plan members served by certain PBM partners.
In addition, starting in 2023, through our partnerships with Express Scripts and CVS Caremark, we commenced operation of our integrated savings programs, which integrates our competitive discounts and pricing in a seamless experience at the pharmacy counter for eligible plan members they serve.
In addition, starting in 2023, we engaged with several PBM partners for our integrated savings program , which integrates our competitive discounts and pricing in a seamless experience at the pharmacy counter for eligible plan members they serve.
Our employees are split among the following departments and functions: 11 principally in customer service, 373 in product development and technology, 175 in sales and marketing, and 135 in general and administrative functions. Women make up 45% (312 employees) of our workforce who have chosen to identify their gender.
O ur employees are split among the following departments and functions: 10 principally in customer service, 391 in product development and technology, 206 in sales and marketing, and 131 in general and administrative functions. Women make u p 46% (3 35 employees) of our workforce who have chosen to identify their gender.
We provide consumers with expert medication information, as well as pricing and coverage information made possible through our robust data sources and staff of experienced researchers.
We provide consumers with expert medication information, as well as pricing and coverage information made possible through our robust data sources and staff of experienced researchers . • Healthcare Professionals: Physicians and other healthcare professionals are motivated to help patients, and, increasingly, are judged by patient outcomes.
State Corporate Practice of Medicine and Fee Splitting Laws With respect to our telehealth platform, GoodRx Care contracts with physician-owned professional entities to deliver our telehealth offering to their patients in the United States principally supported by Wheel Health, Inc.'s (“Wheel”) technology and network of clinicians.
Failure to obtain and maintain the required licenses, certifications or registrations to provide these offerings, as well as to abide by applicable regulations governing these offerings, may result in civil penalties, receipt of cease and desist orders, or a restructuring of our operations. 15 Table of Contents State Corporate Practice of Medicine and Fee Splitting Laws With respect to our telehealth platform, GoodRx Care contracts with physician-owned professional entities to deliver our telehealth offering to their patients in the United States principally supported by Wheel Health, Inc.'s (“Wheel”) technology and network of clinicians.
We principally compete with companies that provide prescription savings and solutions to pharma manufacturers. New entrants may also enter our industry and compete with us. Generally, we believe that we are able to compete effectively against these organizations based on our brand, scale, pricing and consumer experience.
Generally, we believe that we are able to compete effectively against these organizations based on our brand, scale, pricing and consumer experience.
A copy of the code is available on our website at www.goodrx.com in the “Governance” section of the “Investors” page. In addition, we intend to post on our website all disclosures that are required by law concerning any amendments to, or waivers from, any provision of our Code of Business Conduct and Ethics.
In addition, we intend to post on our website all disclosures that are required by law concerning any amendments to, or waivers from, any provision of our Code of Business Conduct and Ethics. The information found on our website is not part of this or any other report we file with, or furnish to, the SEC. 16 Table of Contents
Non-white employees make up 50% (330 employees) of our workforce who have chosen to identify their ethnicity/race. Diversity, equity and inclusion ("DEI") are important considerations, and we strive to build a workforce that can represent the clients, customers and partners that we serve everyday.
Non-white employees make up 48 % (3 36 employees) of our workforce who have chosen to identify their ethnicity/race. We strive to build a workforce that can represent the clients, customers and partners that we serve everyday. After successfully launching 5 CRGs in 2023, we carried that momentum in 2024 and built on our previous accomplishments.
In addition, our enhanced Provider Mode released in 2022, as part of our GoodRx for Providers platform initially launched in 2021, provides healthcare providers with a more customized experience and tools to support patients throughout their healthcare journey.
We help these healthcare professionals improve patient outcomes by encouraging medication adherence and providing a consumer-friendly service. In addition, our Provider Mode platform provides healthcare providers with a more customized experience and tools to support patients throughout their healthcare journey.
Americans have historically not had to be active consumers of healthcare since benefit plans were more generous and open than they are today. Many consumers are not aware that prices for the same prescription vary between pharmacies or that there are competitive cash prices available that may be lower than insurance prices.
Many consumers are not aware that prices for the same prescription vary between pharmacies or that there are competitive cash prices available that may be lower than insurance prices. We principally compete with companies that provide prescription savings and solutions to pharma manufacturers. New entrants may also enter our industry and compete with us.
The Restructuring Plan was substantially completed as of December 31, 2023 and we will continue to monitor our cost structure and strategic priorities. Competition and Industry Participants Although we have built and scaled a differentiated consumer internet platform, we face a variety of types of competition. We believe that our primary barrier to adoption is awareness.
Competition and Industry Participants Although we have built and scaled a differentiated consumer internet platform, we face a variety of types of competition. We believe that our primary barrier to adoption is awareness. Americans have historically not had to be active consumers of healthcare since benefit plans were more generous and open than they are today.
As of December 31, 2023, we employed 694 employees, all of which are full-time employees. Of our total employees, 215 are based at our headquarters in Santa Monica, California.
We prioritize providing a safe, rewarding and respectful workplace where our people have the opportunities to pursue career paths based on skills, performance and potential. 14 Table of Contents As of December 31, 2024 , we employed 738 employees, all of which are full-time employees. Of our total employees, 209 are based at our headquarters in Santa Monica, California.
We believe that advocating for and putting people first, leading with empathy, and building trust across our organization are core to our success. We prioritize providing a safe, rewarding and respectful workplace where our people have the opportunities to pursue career paths based on skills, performance and potential.
Our People and Culture Our people are essential to our success. Our mission is to build and cultivate an inclusive culture that reflects the diversity of the patients, partners and communities we serve. We believe that advocating for and putting people first, leading with empathy, and building trust across our organization are core to our success.
For more information regarding risks related to intellectual property, please see Part I, Item 1A, “Risk Factors—Risks Related to Intellectual Property.” Philanthropy Philanthropy continues to evolve at our company, with cross-functional teams collaborating in an effort to make a bigger impact than ever before.
For more information regarding risks related to intellectual property, please see Part I, Item 1A, “Risk Factors—Risks Related to Intellectual Property.” Philanthropy Philanthropy continues to play an important role in shaping GoodRx’s identity and culture through meaningful contributions to our communities. We believe that, by engaging in philanthropic initiatives, we are fostering stronger connections, both internally and externally.
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Prescription Opportunity We started our business with a focus on the U.S. prescriptions market. The majority of the utilization of our platform relates to generic medications. We also enable consumers to save on brand medications.
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We believe this market opportunity is substantial and estimate the total addressable market (" TAM ") for our primary solutions to be between $600 billion and $710 billion .
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We launched GoodRx Health in 2021 to make it easier for consumers to find the healthcare answers they need. • Healthcare Professionals: Physicians and other healthcare professionals are motivated to help patients, and, increasingly, are judged by patient outcomes. We help these healthcare professionals improve patient outcomes by encouraging medication adherence and providing a consumer-friendly service.
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For example, we previously partnered with Kroger, one of the largest retail pharmacies in the United States, to offer Kroger Savings to their consumers for an annual fee, a portion of which we shared with Kroger until the program sunset in July 2024.
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Subscribers access lower prescription prices at Kroger pharmacies.
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We partner with pharma manufacturers to advertise and integrate these affordability solutions into our platform. For example, our point-of-sale discount programs help lower the cash price of certain branded medications for consumers at the pharmacy counter with little friction, and are increasingly being used by pharma manufacturers to reach more patients.
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We manage key aspects of the program, including subscriber registration, consumer billing, transaction processing and marketing services under an agreement where subscribers were able to enroll in the Kroger Savings through July 1, 2023 in order to continue to fully serve enrolled consumers through the expected sunset of the program in July 2024.
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Integrating philanthropic initiatives into corporate activities not only allows us to channel our collective resources and productivity outwards, but also strengthens our brand reputation, employee engagement, and customer loyalty.
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We partner with pharma manufacturers to advertise and integrate these affordability solutions into our platform. For example, a consumer searching for a brand medication on our platform can select their insurance status and related criteria so that we can automatically determine their eligibility for specific manufacturer savings solutions, and route them to the best option.
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Drawing from the success of "Giving Season" first introduced in 2023, a year-end initiative to encourage employee involvement in charitable acts, our philanthropic efforts in 2024 were focused on enhancing the Company’s culture of volunteering by hosting in-office and virtual volunteering activities for our employees.
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For example, in late 2023, we implemented a multi-phase plan to de-prioritize certain solutions under our pharma manufacturer solutions offering (the “Restructuring Plan”) as part of our continued strategic focus on scaling and re-balancing our cost structure to drive improved margins and shareholder value.
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For example, we hosted our first Company-wide "Volunteer Day", where we partnered with local nonprofit organizations to support and create a lasting impact in our communities across the country by engaging in a variety of tasks, including woodworking and constructing garden benches, painting back-to-school posters for students, and cleaning up public beaches and parks.
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A limited number of PBMs generate a significant percentage of the discounted prices that we present through our platform and, as a result, we generate a significant portion of our revenue from contracts with a limited number of PBMs.
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Remote employees were also invited to participate through virtual volunteering activities. In 2024, we continued to expand the spirit of philanthropy and social impact into different areas of the broader organization. Our Community Resource Groups ("CRGs") also included a philanthropy component to their schedule of events during their respective months of reflection and celebration.
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Throughout our history, helping others is an integral part of our DNA, and we regularly look for new and innovative ways to support our employees and partners while giving back to our communities.
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During Black History Month, we partnered with a Los Angeles-based organization to provide recently-housed families with care packages assembled by our employees in the Santa Monica office. Further, during Pride Month, we hosted a clothing drive across the Company to benefit a local thrift store that helps fund HIV care and services in the community.
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To reach these goals, in 2023, we onboarded a new corporate social responsibility platform with a focus on enabling convenient donation processing, fundraising, volunteer organizing, and communications—all in one place. We believe that philanthropic endeavors help contribute to happier and more effective employees, better community engagement, and overall better business.
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For example, we incorporated CRG partners into our interview process and partnered with external organizations to further our inclusion and belonging efforts.
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In addition, through "Good To Give," our employee-led donation program, we have supported over 20 nonprofit organizations in 2023, with donations totaling approximately $50,000.
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Our Code of Business Conduct and Ethics applies to all of our directors, officers and employees, including our principal executive officer and our principal financial officer. A copy of the code is available on our website at www.goodrx.com in the “Governance” section of the “Investors” page.
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These nonprofit organizations were nominated and voted for by our employees, furthering our efforts to support our workforce and nurture our company value of "Doing Good." We have made financial contributions to a broad range of organizations, including those dedicated to helping our most vulnerable communities, addressing important issues such as youth mentorship, healthcare research, and social services.
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We also introduced "Giving Season" in 2023, a year-end initiative to encourage employee involvement in charitable acts. As part of this initiative, we held volunteering activities simultaneously across our offices, as well as remote opportunities, to help communities in need during the winter months.
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These volunteering opportunities involved assembling clean water filters, building stuffed toys for children in hospitals and shelters, and donating warm clothes to new immigrant families.
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Furthermore, in 2023, we launched our Company-wide matching program, where employees were eligible to match up to $50 in donations to a nonprofit organization of their choice. 13 Table of Contents Our People and Culture Our people are essential to our success.
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DEI considerations touch all facets of our employee lifecycle, from onboarding to experience, performance, tenure and succession planning. In 2023, we launched 5 Community Resource Groups ("CRGs") that advocate for the needs of our members across a diverse range of identities and experiences. The CRGs have appointed leads, executive sponsors, and subpillar leads for recruiting, company events and community impact.
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Furthermore, in 2023, we rolled out an enhanced training pertaining to performance management, interview, microaggression and unconscious bias training. Coaching, mentorship, and building community are top of mind to foster psychological safety and collaboration. Additionally, there are a number of key partnerships that we have cultivated externally with to invest in our DEI efforts.
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We provide consumers options designed to allow them to control the use and disclosure of their data, such as allowing consumers to opt out of marketing communications, opt out of the use of marketing and advertising cookies, pixels and technologies on our platform, and request deletion of their data.
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Failure to obtain and maintain the required licenses, certifications or registrations to provide these offerings, as well as to abide by applicable regulations governing these offerings, may result in civil penalties, receipt of cease and desist orders, or a restructuring of our operations.
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The information found on our website is not part of this or any other report we file with, or furnish to, the SEC. 16 Table of Contents

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIndividual states in the United States have also increasingly passed legislation and implemented regulations designed to control medication pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, disclosure, transparency and reporting requirements to regulatory agencies regarding marketing costs and discounts provided to patients, such as those provided through our prescription transactions offering and subscription offerings, for prescription medications dispensed by pharmacies, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
Biggest changeFor information regarding certain antitrust litigation initiated against us regarding our relationship with PBMs, see Note 13 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K and our risk factor titled “We are, and may become in the future, subject to various legal proceedings and claims that arise in or outside the ordinary course of business, which may require significant management time and attention, result in significant legal expenses and may result in unfavorable outcomes, which may have a material adverse effect on our business, operating results and financial condition, and negatively affect the price of our Class A common stock.” Individual states in the United States have also increasingly passed legislation and implemented regulations designed to control medication pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, disclosure, transparency and reporting requirements to regulatory agencies regarding marketing costs and discounts provided to patients, such as those provided through our prescription transactions offering and subscription 45 Table of Contents offerings, for prescription medications dispensed by pharmacies, and, in some cases, designed to encourage importation from other countries and bulk purchasing.
In addition, if the breadth or 41 Table of Contents strength of protection provided by our patents and patent applications is threatened, regardless of the outcome, it could dissuade companies from collaborating with us to license, develop or commercialize current or future offering candidates. We utilize open source software, which may pose particular risks to our proprietary software and solutions.
In addition, if the breadth or strength of protection provided by our patents and patent applications is threatened, regardless of the outcome, it could dissuade companies from collaborating with us to license, develop or commercialize current or future offering candidates. 41 Table of Contents We utilize open source software, which may pose particular risks to our proprietary software and solutions.
In addition, recently there has been heightened governmental scrutiny over the manner in which pharma manufacturers set prices for their marketed products, which has resulted in several U.S. congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to medication pricing, reduce the cost of prescription medications under government payor programs, and review the relationship between pricing and manufacturer patient programs.
In addition, recently there has been heightened governmental scrutiny of the manner in which pharma manufacturers set prices for their marketed products, which has resulted in several U.S. congressional inquiries and proposed and enacted federal and state legislation designed to, among other things, bring more transparency to medication pricing, reduce the cost of prescription medications under government payor programs, and review the relationship between pricing and manufacturer patient programs.
The market price of our Class A common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial conditions and results of operations; • the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures, results of operations or capital commitments; • changes in stock market valuations and operating performance of other healthcare and technology companies generally, or those in our industry in particular; • price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; • changes in our Board or management; • sales of large blocks of our Class A common stock, including sales by certain affiliates of Silver Lake, Francisco Partners, Spectrum, Idea Men, LLC, our Co-Founders or our executive officers and directors; • lawsuits threatened or filed against us; • anticipated or actual changes in laws, regulations or government policies applicable to our business; • changes in our capital structure, such as future issuances of debt or equity securities; • short sales, hedging and other derivative transactions involving our capital stock; • general economic conditions in the United States; • other events or factors, including those resulting from war, pandemics (such as COVID-19), incidents of terrorism or responses to these events; and • the other factors described in this Part I, Item 1A, “Risk Factors.” The stock market has recently experienced extreme price and volume fluctuations.
The market price of our Class A common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial conditions and results of operations; • the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities analysts who follow our company or our failure to meet these estimates or the expectations of investors; • announcements by us or our competitors of significant technical innovations, acquisitions, strategic partnerships, joint ventures, results of operations or capital commitments; • changes in stock market valuations and operating performance of other healthcare and technology companies generally, or those in our industry in particular; • price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole; • changes in our Board or management; • sales of large blocks of our Class A common stock, including sales by certain affiliates of Silver Lake, Francisco Partners, Spectrum, Idea Men, LLC, our Co-Founders or our executive officers and directors; • lawsuits threatened or filed against us; • anticipated or actual changes in laws, regulations or government policies applicable to our business; 52 Table of Contents • changes in our capital structure, such as future issuances of debt or equity securities; • short sales, hedging and other derivative transactions involving our capital stock; • general economic conditions in the United States; • other events or factors, including those resulting from war, pandemics (such as COVID-19), incidents of terrorism or responses to these events; and • the other factors described in this Part I, Item 1A, “Risk Factors.” The stock market has recently experienced extreme price and volume fluctuations.
Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of our company more difficult, including the following: • amendments to certain provisions of our amended and restated certificate of incorporation or amendments to our amended and restated bylaws generally require the approval of at least 66 2/3% of the voting power of our outstanding capital stock; • our dual class common stock structure, which provides certain affiliates of Silver Lake, Francisco Partners, Spectrum, Idea Men, LLC and our Co-Founders, individually or together, with the ability to significantly influence the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the shares of our outstanding Class A common stock and Class B common stock; • our staggered Board; • at any time when the holders of our Class B common stock no longer beneficially own, in the aggregate, at least the majority of the voting power of our outstanding capital stock, our stockholders will only be able to take action at a meeting of stockholders and will not be able to take action by written consent for any matter; • our amended and restated certificate of incorporation does not provide for cumulative voting; 47 Table of Contents • vacancies on our Board are able to be filled only by our Board and not by stockholders, subject to the rights granted pursuant to the stockholders agreement; • a special meeting of our stockholders may only be called by the chairperson of our Board, our Chief Executive Officer or a majority of our Board; • restrict the forum for certain litigation against us to Delaware or the federal courts, as applicable; • our amended and restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders; and • advance notice procedures apply for stockholders (other than the parties to our stockholders agreement) to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
Certain provisions in our amended and restated certificate of incorporation and amended and restated bylaws contain provisions that may make the acquisition of our company more difficult, including the following: • amendments to certain provisions of our amended and restated certificate of incorporation or amendments to our amended and restated bylaws generally require the approval of at least 66 2/3% of the voting power of our outstanding capital stock; • our dual class common stock structure, which provides certain affiliates of Silver Lake, Francisco Partners, Spectrum, Idea Men, LLC and our Co-Founders, individually or together, with the ability to significantly influence the outcome of matters requiring stockholder approval, even if they own significantly less than a majority of the shares of our outstanding Class A common stock and Class B common stock; • our staggered Board; • at any time when the holders of our Class B common stock no longer beneficially own, in the aggregate, at least the majority of the voting power of our outstanding capital stock, our stockholders will only be able to take action at a meeting of stockholders and will not be able to take action by written consent for any matter; • our amended and restated certificate of incorporation does not provide for cumulative voting; • vacancies on our Board are able to be filled only by our Board and not by stockholders, subject to the rights granted pursuant to the stockholders agreement; • a special meeting of our stockholders may only be called by the chairperson of our Board, our Chief Executive Officer or a majority of our Board; • restrict the forum for certain litigation against us to Delaware or the federal courts, as applicable; • our amended and restated certificate of incorporation authorizes undesignated preferred stock, the terms of which may be established and shares of which may be issued without further action by our stockholders; and • advance notice procedures apply for stockholders (other than the parties to our stockholders agreement) to nominate candidates for election as directors or to bring matters before an annual meeting of stockholders.
These estimates are based on third-party reports and are subject to significant assumptions and estimates. Additionally, we calculated the TAM for our pharma manufacturer solutions opportunity based on recent internal data regarding the amount of advertising and marketing spending by U.S. pharma manufacturers relating to prescription drugs in 2022.
These estimates are based on third-party reports and are subject to significant assumptions and estimates. Additionally, we calculated the TAM for our pharma manufacturer solutions opportunity based on internal data regarding the amount of advertising and marketing spending by U.S. pharma manufacturers relating to prescription drugs in 2022 .
Consumer protection and certain state data privacy laws like the CCPA and CPRA require us to publish statements that describe how we handle personal information and choices individuals may have about the way we handle or provide access to their personal information.
Consumer protection and certain state data privacy laws like the CCPA require us to publish statements that describe how we handle personal information and choices individuals may have about the way we handle or provide access to their personal information.
Our amended and restated certificate of incorporation provides that, unless we otherwise consent in writing, (A) (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee or stockholder of the Company to the Company or the Company’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our amended and restated certificate of incorporation or our amended and restated bylaws (as either may be amended or restated) or as to which the Delaware General Corporation Law confers exclusive jurisdiction on the Court of 48 Table of Contents Chancery of the State of Delaware or (iv) any action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware shall, to the fullest extent permitted by law, be exclusively brought in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware; and (B) the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
Our amended and restated certificate of incorporation provides that, unless we otherwise consent in writing, (A) (i) any derivative action or proceeding brought on behalf of the Company, (ii) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, other employee or stockholder of the Company to the Company or the Company’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, our amended and restated certificate of incorporation or our amended and restated bylaws (as either may be amended or restated) or as to which the Delaware General Corporation Law confers exclusive jurisdiction on the Court of Chancery of the State of Delaware or (iv) any action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware shall, to the fullest extent permitted by law, be exclusively brought in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware; and (B) the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act.
These laws impact, among other things, our sales, marketing, support and education programs and constrain our business and financial arrangements and relationships with pharmacies, PBMs, pharma manufacturers, marketing partners, healthcare professionals and consumers, and include, but are not limited to, the following: • the U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, offering, receiving or paying any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, lease, order, or arranging for or recommending the purchase, lease or order of, any item or service, for which payment may be made, in whole or in part, under federal healthcare programs such as Medicare and Medicaid.
These laws impact, among other things, our sales, marketing, support and education programs and 42 Table of Contents constrain our business and financial arrangements and relationships with pharmacies, PBMs, pharma manufacturers, marketing partners, healthcare professionals and consumers, and include, but are not limited to, the following: • the U.S. federal Anti-Kickback Statute, which prohibits, among other things, persons or entities from knowingly and willfully soliciting, offering, receiving or paying any remuneration, directly or indirectly, overtly or covertly, in cash or in kind, to induce or reward either the referral of an individual for, or the purchase, lease, order, or arranging for or recommending the purchase, lease or order of, any item or service, for which payment may be made, in whole or in part, under federal healthcare programs such as Medicare and Medicaid.
We also have a revolving credit facility and as of December 31, 2023, we had no borrowings outstanding under our revolving credit facility (see Note 12 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information).
We also have a revolving credit facility and as of December 31, 2024 , we had no borrowings outstanding under our revolving credit facility (see Note 12 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information).
Additionally, some providers of consumer devices and web browsers have implemented, or announced plans to implement, limits on behavioral or targeted advertising and/or means to make it easier for internet users to prevent the placement of cross-site behavioral advertising technologies or to block other tracking technologies, which could, if widely adopted, result in the decreased effectiveness or use of third-party cross-site behavioral advertising technologies and other methods of online tracking, targeting or re-targeting.
Additionally, some providers of consumer devices and web browsers have implemented, or announced plans to implement, limits on behavioral or targeted advertising and/or means to make it easier for internet users to prevent the placement of cross-site behavioral advertising 30 Table of Contents technologies or to block other tracking technologies, which could, if widely adopted, result in the decreased effectiveness or use of third-party cross-site behavioral advertising technologies and other methods of online tracking, targeting or re- targeting.
If existing or new companies develop or market an offering similar to ours, develop an entirely new solution for access to affordable healthcare, acquire one of our 23 Table of Contents existing competitors or form a strategic alliance with one of our competitors or other industry participants, our ability to compete effectively could be significantly impacted, which would have a material adverse effect on our business, results of operations and financial condition.
If existing or new companies develop or market an offering similar to ours, develop an entirely new solution for access to affordable healthcare, acquire one of our existing competitors or form a strategic alliance with one of our competitors or other industry participants, our ability to compete effectively could be significantly impacted, which would have a material adverse effect on our business, results of operations and financial condition.
Because email, mail and other messaging channels are important to our business, if we are unable to successfully deliver messages to consumers through these channels, if there are legal restrictions on delivering such messages to consumers, if consumers do not or 29 Table of Contents cannot open or otherwise utilize our messages or if consumers reject the receipt of communications referencing particular prescriptions or conditions, our revenues and profitability would be adversely affected.
Because email, mail and other messaging channels are important to our business, if we are unable to successfully deliver messages to consumers through these channels, if there are legal restrictions on delivering such messages to consumers, if consumers do not or cannot open or otherwise utilize our messages or if consumers reject the receipt of communications referencing particular prescriptions or conditions, our revenues and profitability would be adversely affected.
We are, and may become in the future, subject to various legal proceedings and claims that arise in or outside the ordinary course of business, which may require significant management time and attention, result in significant 46 Table of Contents legal expenses and may result in unfavorable outcomes, which may have a material adverse effect on our business, operating results and financial condition, and negatively affect the price of our Class A common stock.
We are, and may become in the future, subject to various legal proceedings and claims that arise in or outside the ordinary course of business, which may require significant management time and attention, result in significant legal expenses and may result in unfavorable outcomes, which may have a material adverse effect on our business, operating results and financial condition, and negatively affect the price of our Class A common stock.
For example, HIPAA imposes privacy, security and breach reporting obligations with respect to individually identifiable health information upon “covered entities” (health plans, health care clearinghouses and certain health care providers) and their respective business associates, individuals or entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity.
For example, HIPAA imposes privacy, security and breach reporting obligations with respect to individually 31 Table of Contents identifiable health information upon “covered entities” (health plans, health care clearinghouses and certain health care providers) and their respective business associates, individuals or entities that create, receive, maintain or transmit protected health information in connection with providing a service for or on behalf of a covered entity.
Although we try to ensure that our employees, consultants, and advisors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that we or these individuals have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such individual’s current or former employer.
Although we try to ensure that our employees, consultants, and advisors do not use the proprietary information or know-how of others in their work for us, we may be subject to claims that 51 Table of Contents we or these individuals have used or disclosed intellectual property, including trade secrets or other proprietary information, of any such individual’s current or former employer.
Any similar litigation against us could result in substantial costs, divert management’s attention and resources, and harm our business, financial condition and results of operations. 52 Table of Contents Item 1B. Unresolved Staff Comments. Not applicable.
Any similar litigation against us could result in substantial costs, divert management’s attention and resources, and harm our business, financial condition and results of operations. 53 Table of Contents Item 1B. Unresolved Staff Comments. Not applicable.
Although the consumers who use our offerings do so outside of any medication or other health benefits covered under their health insurance, including any commercial or government healthcare program, we may nonetheless be subject to 42 Table of Contents healthcare fraud and abuse regulation and enforcement by both the U.S. federal government and the states in which we conduct our business.
Although the consumers who use our offerings do so outside of any medication or other health benefits covered under their health insurance, including any commercial or government healthcare program, we may nonetheless be subject to healthcare fraud and abuse regulation and enforcement by both the U.S. federal government and the states in which we conduct our business.
SLP Geology Aggregator, L.P., Francisco Partners IV, L.P., Francisco Partners IV-A, L.P., Spectrum Equity VII, L.P., Spectrum VII Investment Managers’ Fund, L.P., Spectrum VII Co-Investment Fund, L.P. and Idea Men, LLC or their affiliates and any director or stockholder who is not employed by us or our subsidiaries, therefore, have no duty to communicate or present corporate opportunities to us, and have the right to either hold any corporate opportunity for their (and their affiliates’) own account and benefit or to recommend, assign or otherwise transfer such corporate opportunity to persons other than us, including to any director or stockholder who is not employed by us or our subsidiaries.
SLP Geology Aggregator, L.P., Francisco Partners IV, L.P., Francisco Partners IV-A, L.P., Spectrum Equity VII, L.P., Spectrum VII Investment Managers’ Fund, L.P., Spectrum VII Co-Investment Fund, L.P. and Idea Men, LLC or their affiliates and any director or stockholder who is not employed by us or our subsidiaries, therefore, have no duty to communicate or present corporate opportunities to us, 48 Table of Contents and have the right to either hold any corporate opportunity for their (and their affiliates’) own account and benefit or to recommend, assign or otherwise transfer such corporate opportunity to persons other than us, including to any director or stockholder who is not employed by us or our subsidiaries.
We are obligated to maintain effective internal control over financial reporting and any failure to maintain effective internal controls may cause us to not be able to accurately report our financial condition or results of operations, which may adversely affect investor confidence in our company and, as a result, the value of our Class A common stock.
We are obligated to maintain effective internal control over financial reporting and any failure to maintain effective internal controls may cause us to not be able to accurately report our financial condition or results of operations, 25 Table of Contents which may adversely affect investor confidence in our company and, as a result, the value of our Class A common stock.
The markets in which we compete are relatively new and subject to rapid technological change, evolving industry standards, and changing regulations, as well as changing consumer needs, requirements and preferences. The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis.
The markets in which we compete are relatively new and subject to rapid technological change, evolving industry standards, and changing regulations, as well as changing consumer needs, requirements and preferences. 26 Table of Contents The success of our business will depend, in part, on our ability to adapt and respond effectively to these changes on a timely basis.
For example, various regulators, including the SEC and the State of California, have adopted or are considering adopting requirements to provide significantly expanded climate-related disclosures which we anticipate will require us to incur significant costs related to compliance and impose increased 37 Table of Contents oversight obligations on our management and Board.
For example, various regulators, including the SEC and the State of California, have adopted or are considering adopting requirements to provide significantly expanded climate-related disclosures which we anticipate will require us to incur significant costs related to compliance and impose increased oversight obligations on our management and Board.
If any such 20 Table of Contents expansion does not enhance our ability to maintain or grow revenue or recover any associated development costs, our business, financial condition and results of operations could be adversely affected. Our business is subject to changes in medication pricing and is significantly impacted by pricing structures negotiated by industry participants.
If any such expansion does not enhance our ability to maintain or grow revenue or recover any associated development costs, our business, financial condition and results of operations could be adversely affected. Our business is subject to changes in medication pricing and is significantly impacted by pricing structures negotiated by industry participants.
These types of restructuring and cost reduction activities are complex and may result in unintended consequences and costs, such as unforeseen delays in the implementation of our strategic initiatives, business and operational disruptions, decreased employee morale, loss of institutional knowledge and expertise, and potential impacts on financial reporting and the related internal controls.
T hese types of restructuring and cost reduction activities are complex and may result in unintended consequences and costs, such as unforeseen delays in the implementation of our strategic initiatives, business and operational disruptions, decreased employee morale, loss of institutional knowledge and expertise, and potential impacts on financial reporting and the related internal controls.
These risks and challenges include our ability to: • continue to attract new consumers to our platform and position our platform as an important way to make purchasing decisions for prescription medications and other healthcare products and services; • retain our consumers and encourage them to continue to utilize our platform when purchasing healthcare products and services; • attract new and existing consumers to rapidly adopt new offerings on our platform; • increase the number of consumers that use our subscription offerings or the number of subscription programs that we manage; • increase and retain our consumers that subscribe to our subscription offerings, such as Gold; • attract and retain industry players for inclusion in our platform, including pharmacies, PBMs, pharma manufacturers and telehealth providers; • comply with existing and new or amended laws and regulations applicable to our business and in our industry; • anticipate and respond to macroeconomic changes, changes in medication pricing and industry pricing benchmarks and changes in market dynamics in the markets in which we operate, including any impacts of the current economic slowdown; • react to challenges from existing and new competitors; • maintain and enhance the value of our reputation and brand; • effectively manage our growth; • to realize expected benefits from restructuring and cost reduction efforts; • hire, integrate and retain talented people at all levels of our organization; • maintain and improve the infrastructure underlying our platform, including our apps and websites, including with respect to data protection and cybersecurity; and • successfully update our platform, including expanding our platform and offerings into different healthcare products and services, develop and update our apps, features, offerings and services to benefit our consumers and enhance the consumer experience.
These risks and challenges include our ability to: • continue to attract new consumers to our platform and position our platform as an important way to make purchasing decisions for prescription medications and other healthcare products and services; • retain our consumers and encourage them to continue to utilize our platform when purchasing healthcare products and services; • attract new and existing consumers to rapidly adopt new offerings on our platform; • increase the number of consumers that use our subscription offerings or the number of subscription programs that we manage; • increase and retain our consumers that subscribe to our subscription offerings, such as Gold; • attract and retain industry players for inclusion in our platform, including pharmacies, PBMs and pharma manufacturers; • comply with existing and new or amended laws and regulations applicable to our business and in our industry; • anticipate and respond to macroeconomic changes, changes in medication pricing and industry pricing benchmarks and changes in market dynamics in the markets in which we operate; • react to challenges from existing and new competitors and evolving industry trends; • maintain and enhance the value of our reputation and brand; • effectively manage our growth; • realize expected benefits from restructuring and cost reduction efforts; • hire, integrate and retain talented people at all levels of our organization; • maintain and improve the infrastructure underlying our platform, including our apps and websites, including with respect to data protection and cybersecurity; and • successfully update our platform, including expanding our platform and offerings into different healthcare products and services, develop and update our apps, features, offerings and services to benefit our consumers and enhance the consumer experience.
Our issued patents begin expiring in 2034, excluding any patent term adjustment. 38 Table of Contents Our issued patents and those that may be issued in the future may not provide us with competitive advantages, may be of limited territorial reach and may be held invalid or unenforceable if successfully challenged by third parties, and our patent applications may never be issued.
Our issued patents begin expiring in 2034 , excluding any patent term adjustment. Our issued patents and those that may be issued in the future may not provide us with competitive advantages, may be of limited territorial reach and may be held invalid or unenforceable if successfully challenged by third parties, and our patent applications may never be issued.
We do not intend to rely on all of these exemptions. However, as long as we remain a “controlled company,” we may elect in the future to take advantage of any of these exemptions.
We do not intend to rely on all of these exemptions. However, as long as we remain a “controlled company,” we rely on certain of these exemptions and may elect in the future to take advantage of any of these exemptions.
As we have agreements with PBMs to market their negotiated rates through our platform, our ability to present discounted prices is in part dependent upon the arrangements that such PBMs have negotiated with pharmacies and upon the resulting availability and allocation of discounts for medications subject to these arrangements.
As we have agreements with PBMs to market their negotiated rates through our platform, our ability to present 21 Table of Contents discounted prices is in part dependent upon the arrangements that such PBMs have negotiated with pharmacies and upon the resulting availability and allocation of discounts for medications subject to these arrangements.
If we do not successfully manage our current initiatives and restructuring activities or 32 Table of Contents any other similar activities that we may undertake in the future, expected efficiencies and benefits might be delayed or not realized, and our business, financial condition, and results of operations may be materially adversely affected.
If we do not successfully manage our current initiatives and restructuring activities or any other similar activities that we may undertake in the future, expected efficiencies and benefits might be delayed or not realized, and our business, financial condition, and results of operations may be materially adversely affected.
A determination of non-compliance, or the 44 Table of Contents termination of or failure to successfully restructure these relationships could result in disciplinary action, penalties, damages, fines, and/or a loss of revenue, any of which could have a material and adverse effect on our business, financial condition and results of operations.
A determination of non-compliance, or the termination of or failure to successfully restructure these relationships could result in disciplinary action, penalties, damages, fines, and/or a loss of revenue, any of which could have a material and adverse effect on our business, financial condition and results of operations.
In addition, companies that perceive 51 Table of Contents us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties based on sales of our solutions and services.
In addition, companies that perceive us to be a competitor may be unwilling to assign or license rights to us. Even if such licenses are available, we may be required to pay the licensor substantial royalties based on sales of our solutions and services.
The U.S. prescriptions market is dominated by a limited number of national and regional pharmacy chains, such as CVS, Kroger, Walmart and Walgreens. These pharmacy chains represent a significant portion of overall prescription medication transactions in the United States.
The U.S. prescriptions market is dominated by a limited number of national and regional pharmacy chains, such as CVS, Kroger, Walmart and Walgreens. These pharmacy chains represent a significant 22 Table of Contents portion of overall prescription medication transactions in the United States.
If they succeed in registering or developing common law rights in such trademarks, and if we are not successful in challenging such third-party rights, we may not be able to use these trademarks to develop brand recognition of our technologies, solutions or services.
If they succeed in registering or developing common law rights in such trademarks, and if we are not successful in challenging such third-party rights, we may not be able to use these trademarks to develop brand recognition of our technologies, 40 Table of Contents solutions or services.
As a result, the discounted prices that we are able to present for brand 21 Table of Contents medications may not be as competitive as for generic medications. Similar to the total prescription volume in the United States, the majority of the utilization of our platform relates to generic medications.
As a result, the discounted prices that we are able to present for brand medications may not be as competitive as for generic medications. Similar to the total prescription volume in the United States, the majority of the utilization of our platform relates to generic medications.
It is difficult to predict whether the pace of the transition from traditional to digital channels will continue at the same rate and whether the growth of the digital channel will continue.
It is difficult to predict whether the pace of the transition from traditional to digital channels will continue at the same rate and the degree to which the growth of the digital channel will continue.
In particular, we calculated the TAM for our prescription opportunity based on data from the Centers for Medicare & Medicaid Services regarding the expected size of U.S. prescription expenditures in 2023, plus our estimated value of prescriptions that are written but not filled, which we estimate to range between 20% to 30% of the overall prescription opportunity.
In particular, we calculated the TAM for our prescription opportunity based on data from the Centers for Medicare & Medicaid Services regarding the expected size of U.S. prescription expenditures in 2024 and 2025 , plus our estimated value of prescriptions that are written but not filled, which we estimate to range between 20% to 30% of the overall prescription opportunity.
Volatility in the financial markets has also had and may continue to have a negative impact on consumer spending patterns. In addition, negative national or global economic conditions may materially and adversely affect the PBMs, partner pharmacies and pharma manufacturers we contract with and their associated industry participants, financial performance, liquidity and access to capital.
Volatility in the financial markets has also had and may continue to have a negative impact on consumer spending patterns. In addition, negative national or global economic conditions have adversely affected the PBMs, partner pharmacies and pharma manufacturers we contract with and their associated industry participants, financial performance, liquidity and access to capital, and may continue to impact them.
Most significantly, on August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 (the “IRA”) into law. This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010.
Most significantly, in August 2022, former President Biden signed the Inflation Reduction Act of 2022 (the “IRA”) into law. This statute marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in 2010.
State corporate practice of medicine doctrines and fee-splitting prohibitions also often impose penalties on healthcare professionals for aiding the corporate practice of medicine, which could discourage physicians and other healthcare professionals from participating in our network of providers.
State corporate practice of medicine doctrines and fee-splitting prohibitions also often impose 44 Table of Contents penalties on healthcare professionals for aiding the corporate practice of medicine, which could discourage physicians and other healthcare professionals from participating in our network of providers.
In that event, the market price of our Class A common stock could decline and you could lose part or all of your investment. Risks Related to Our Limited Operating History and Early Stage of Growth Our limited operating history and our evolving business make it difficult to evaluate our future prospects and the risks and challenges we may encounter.
In that event, the market price of our Class A common stock could decline and you could lose part or all of your investment. Risks Related to Our Limited Operating History and Recent Growth Rates Our limited operating history and our evolving business make it difficult to evaluate our future prospects and the risks and challenges we may encounter.
Our paid marketing initiatives include television, search engine marketing, mail to consumers and healthcare provider offices, email, display, radio and magazine advertising and social media marketing as well as consumer discounts and incentives. For example, we actively market our platform and offerings through television and we rely on direct mail to distribute marketing materials to consumers.
Our paid marketing initiatives include television, search engine marketing, mail to consumers and healthcare provider offices, email, display, radio and magazine advertising and social media marketing as well as consumer 19 Table of Contents discounts and incentives. For example, we actively market our platform and offerings through television and we rely on direct mail to distribute marketing materials to consumers.
Revenue from our prescription transactions offering represented 73%, 72% and 80% of our revenue for the years ended December 31, 2023, 2022 and 2021, respectively. Substantially all of this revenue was generated from consumer transactions at brick-and-mortar pharmacies.
Revenue from our prescription transactions offering represented 73% , 73% and 72% of our revenue for the years ended December 31, 2024 , 2023 and 2022 , respectively. Substantially all of this revenue was generated from consumer transactions at brick-and-mortar pharmacies.
As of December 31, 2023, the holders of our Class B common stock, including the parties to our stockholders agreement, who also hold a significant portion of our Class B common stock, own approximately 97.0% of the combined voting power of our Class A and Class B common stock, with each share of Class A common stock entitling the holder to one vote and each share of Class B common stock entitling the holder to 10 votes, until the earlier of, (i) the first date on which the aggregate number of outstanding shares of our Class B common stock ceases to represent at least 10% of the aggregate number of our outstanding shares of common stock and (ii) September 25, 2027, on all matters submitted to a vote of our stockholders.
As of December 31, 2024 , the holders of our Class B common stock, including the parties to our stockholders agreement, who also hold a significant portion of our Class B common stock, own approximately 96.3% of the combined voting power of our Class A and Class B common stock, with each share of Class A common stock entitling the holder to one vote and each share of Class B common stock entitling the holder to 10 votes, until the earlier of, (i) the first date on which the aggregate number of outstanding shares of our Class B common stock ceases to represent at least 10% of the aggregate number of our outstanding shares of common stock and (ii) September 25, 2027, on all matters submitted to a vote of our stockholders .
To effectively market our 18 Table of Contents platform, we must educate consumers about the various purchase options and the benefits of using GoodRx codes when purchasing prescription medications and other healthcare products and services.
To effectively market our platform, we must educate consumers about the various purchase options and the benefits of using GoodRx codes when purchasing prescription medications and other healthcare products and services.
While we negotiate protective terms related to our discounted prices, our intellectual property and our consumers, in our contracts with PBMs and partner pharmacies, such contracts are not exclusive and PBMs as well as our partner pharmacies can work with others in the industry to drive volume to their networks.
While we negotiate protective terms related to our 23 Table of Contents discounted prices, our intellectual property and our consumers, in our contracts with PBMs and partner pharmacies, such contracts are not exclusive and PBMs as well as our partner pharmacies can work with others in the industry to drive volume to their networks.
We also buy search advertising primarily through search engines such as Google and Bing, and use internal analytics and external vendors for bid optimization and channel strategy. Our non-paid 19 Table of Contents advertising efforts include search engine optimization, non-paid social media and e-mail marketing.
We also buy search advertising primarily through search engines such as Google and Bing, and use internal analytics and external vendors for bid optimization and channel strategy. Our non-paid advertising efforts include search engine optimization, non-paid social media and e-mail marketing.
As we attempt to expand our offerings and optimize our partnerships, we may need to take additional steps, such as hiring additional personnel, partnering with new third parties and incurring considerable research and development expenses, in order to pursue such expansion and optimization successfully.
As we attempt to expand our offerings and optimize 20 Table of Contents our partnerships, we may need to take additional steps, such as hiring additional personnel, partnering with new third parties and incurring considerable research and development expenses, in order to pursue such expansion and optimization successfully.
Due in part to existing pricing structures, we generate a smaller portion of our revenue through contracts with pharma manufacturers and other intermediaries. Changes in the roles of industry participants and in general pricing structures, as well as price competition among industry participants, could have an adverse impact on our business.
Due in part to existing pricing structures, we generate a smaller portion of our revenue through contracts with pharma manufacturers and other intermediaries. Changes in the roles of industry participants and in general pricing structures, increased regulatory scrutiny and action against industry participants, as well as price competition among industry participants, could have an adverse impact on our business.
Similarly, a significant portion of our discounted prices are used at a limited number of pharmacy chains and, as a result, a significant portion of our revenue is derived from 22 Table of Contents transactions processed at a limited number of pharmacy chains.
Similarly, a significant portion of our discounted prices are used at a limited number of pharmacy chains and, as a result, a significant portion of our revenue is derived from transactions processed at a limited number of pharmacy chains.
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare (beginning in 2026), with prices that can be negotiated subject to a cap; imposes rebates on manufacturers under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); and replaces the Part D coverage gap discount program with a new discounting program (beginning in 2025).
Among other things, the IRA requires manufacturers of certain drugs to engage in price negotiations with Medicare, with prices that can be negotiated subject to a cap; imposes rebates under Medicare Part B and Medicare Part D to penalize price increases that outpace inflation (first due in 2023); redesigns the Medicare Part D benefit (beginning in 2024); and replaces the Part D coverage gap discount program with a new manufacturer discounting program (beginning in 2025).
The costs related to significant security breaches or disruptions could be material and exceed 28 Table of Contents the limits of the cybersecurity insurance we maintain against such risks.
The costs related to significant security breaches or disruptions could be material and exceed the limits of the cybersecurity insurance we maintain against such risks.
We work with more than a dozen PBMs that maintain cash networks and prices, and the number of PBMs we work with has significantly increased over time, limiting the extent to which any one PBM contributes to our overall revenue; however, we may not expand beyond our existing PBM partners and the number of our PBM partners may even decline.
We work with dozens of PBMs that maintain cash networks and prices, and the number of PBMs we work with has significantly increased over time, limiting the extent to which any one PBM contributes to our overall revenue; however, we may not expand beyond our existing PBM partners and the number of our PBM partners may even decline.
There also can be no assurance that we would be able to develop or license suitable alternative technology, content or other intellectual property to permit us to continue offering the affected technology, content or services to our 39 Table of Contents partners.
There also can be no assurance that we would be able to develop or license suitable alternative technology, content or other intellectual property to permit us to continue offering the affected technology, content or services to our partners.
Certain natural events may become more frequent or intense as a result of climate change. For more information, see our risk factor titled “We are subject to a series of risks related to climate change.” Cloud computing, in particular, is dependent upon having access to an internet connection in order to retrieve data.
Certain of these events may become more frequent or intense as a result of climate change or other environmental or social pressures. For more information, see our risk factor titled “We are subject to a series of risks related to climate change.” Cloud computing, in particular, is dependent upon having access to an internet connection in order to retrieve data.
For example, our corporate headquarters and other facilities are located in California, which in the past has experienced both severe earthquakes and wildfires. Certain natural events may become more frequent or intense as a result of climate change.
For example, our corporate headquarters and other facilities are located in California, which in the past has experienced both severe earthquakes and wildfires. Certain of these events may become more frequent or intense as a result of climate change or other environmental or social pressures.
Recessionary economic cycles, higher interest rates, volatile fuel and energy costs, inflation, levels of unemployment, conditions in the residential real estate and mortgage markets, access to credit, consumer debt levels, unsettled financial markets and other economic factors that may affect costs of manufacturing prescription medications, consumer spending or buying habits could materially and adversely affect demand for our offerings.
Recessionary economic cycles, changing interest rates, volatile fuel and energy costs, inflation, levels of unemployment, conditions in the residential real estate and mortgage markets, access to credit, consumer debt levels, tariffs, government spending freezes, unsettled financial markets and other economic factors that may affect costs of manufacturing prescription medications, consumer spending or buying habits could materially and adversely affect our customers, our consumers, and demand for our offerings.
The impact of recent healthcare reform legislation and other changes in the healthcare industry and in healthcare spending on us is currently unknown, but may adversely affect our business, financial condition and results of operations. Our revenue is dependent on the healthcare industry and could be affected by changes in healthcare spending and policy.
The impact of healthcare reform legislation and other proposed or future changes impacting the healthcare industry and healthcare spending on us is currently unknown, but may adversely affect our business, financial condition and results of operations . Our revenue is dependent on the healthcare industry and could be affected by changes in healthcare spending and policy.
In addition, though we have wound down vitaCare Prescription Services, Inc.’s ("vitaCare") principal operations in connection with our Restructuring Plan, vitaCare's past activities could be subject to regulation and enforcement by the federal government and the states in which vitaCare conducted its business, including state licensing of pharmacies and pharmacists.
Though we have wound down vitaCare Prescription Services, Inc.’s ("vitaCare") principal operations, vitaCare's past activities could be subject to regulation and enforcement by the federal government and the states in which vitaCare conducted its business, including state licensing of pharmacies and pharmacists.
Our success and future growth largely depend on our ability to increase consumer awareness of our platform and offerings, and on the willingness of consumers to utilize our platform to access information, discounted prices for prescription medications and other healthcare products and services, including telehealth services.
Our success and future growth largely depend on our ability to increase consumer awareness of our platform and offerings, and on the willingness of consumers to utilize our platform to access information, discounted prices for prescription 18 Table of Contents medications and other healthcare products and services.
Unfavorable ESG ratings could lead to increased negative investor sentiment towards us or our industry, which could negatively impact our share price as well as our access to and cost of capital.
Unfavorable ESG ratings could adversely impact investor sentiment towards us or our industry, which could negatively impact our share price as well as our access to and cost of capital.
As of December 31, 2023, certain affiliates of Silver Lake, Francisco Partners, Spectrum and Idea Men, LLC own approximately 95.6% of the combined voting power of our Class A and Class B common stock and are parties, among others, to a stockholders agreement.
As of December 31, 2024 , certain affiliates of Silver Lake, Francisco Partners, Spectrum and Idea Men, LLC own approximately 94.8% of the combined voting power of our Class A and Class B common stock and are parties, among others, to a stockholders agreement.
Consequently, a decline in new or renewed contracts in any one quarter may not be fully reflected in our revenue for that quarter. The grocer issue and the ongoing impact of COVID-19 may have masked some of these trends in recent periods and may continue to impact these trends in the future.
Consequently, a decline in new or renewed contracts in any one quarter may not be fully reflected in our revenue for that quarter. The changing retail pharmacy landscape, as well as the grocer issue and the impact of COVID-19 may have masked some of these trends in recent periods and may continue to impact these trends in the future.
Some of our PBM contracts provide for these continuing payments for so long as negotiated rates related to the applicable PBM contract continue to be used after termination, and other contracts provide for these continuing payments for specified multi-year payment periods after termination.
Some of our PBM contracts provide for these continuing payments for so long as negotiated rates related to the applicable PBM contract continue to be used after termination, and other contracts provide for these continuing payments for specified multi-year payment periods after termination. Between contract renewals, our current contracts generally provide for limited termination rights.
A softening in income, whether caused by changes in consumer preferences or a weakening in global economies, may result in decreased revenue levels, and we may be unable to adjust our spending in a timely manner to compensate for any unexpected shortfall in income.
A softening in income, whether caused by changes in consumer preferences, the closure of retail pharmacy locations or a weakening in global economies or otherwise, may result in decreased revenue levels, and we may be unable to adjust our spending in a timely manner to compensate for any unexpected shortfall in income.
Unfavorable publicity regarding, for example, the healthcare industry, industry competition, litigation or regulatory activity, the actions of the entities included or otherwise involved with our platform, negative perceptions of prescriptions included on our platform, medication pricing, pricing structures in place amongst the industry participants, our data privacy or data security practices, our platform or our revenue could materially adversely affect our reputation.
Unfavorable publicity regarding, for example, the healthcare industry, healthcare costs, industry competition, litigation or regulatory activity, the actions of the entities included or otherwise involved with our platform, negative perceptions of prescriptions included on our platform, medication pricing, pricing structures in place amongst the industry participants, pharmacy closures, our relationships with pharmacies, PBMs and pharma manufacturers, our data privacy or data security practices, our platform or our revenue could materially adversely affect our reputation.
Private litigants may claim that the notices and disclosures we provide, form of consents we obtain or our general privacy practices are not adequate or violate applicable law. This may in the future result in civil claims against us. The scope and interpretation of the MHMDA will be continuously evolving and developing.
Private litigants may claim that the notices and disclosures we provide, form of consents we obtain or our general privacy practices are not adequate or violate applicable law. This may in the future result in civil claims against us.
Additionally, Google's Chrome browser has started implementing similar changes. Various industry participants have worked to develop and finalize standards relating to a mechanism in which consumers choose whether to allow the tracking of their online search and browsing activities, and such standards may be implemented and adopted by industry participants at any time.
Various industry participants have worked to develop and finalize standards relating to a mechanism in which consumers choose whether to allow the tracking of their online search and browsing activities, and such standards may be implemented and adopted by industry participants at any time.
The introduction of competing offerings with lower prices for consumers, fluctuations in prescription prices, changes in consumer purchasing habits, including an increase in the use of mail delivery prescriptions, changes in our relationships with industry participants and our various partners, changes in the regulatory landscape, and other factors could result in changes to our contracts or a decline in our total revenue, which may have an adverse effect on our business, financial condition and results of operations.
The introduction of competing offerings with lower prices for consumers, fluctuations in prescription prices, mass closures of retail pharmacy chain locations, changes in consumer purchasing habits, including an increase in the use of mail delivery prescriptions, changes in our relationships with industry participants and our various partners, changes in the regulatory landscape, and other factors could result in changes to our contracts or a decline in our total revenu e, which have had and ma y continue to have an adverse effect on our business, financial condition and results of operations.
Lawsuits and other administrative or legal proceedings that may arise in the course of our operations can involve substantial costs, including the costs associated with investigation, litigation and possible settlement, judgment, penalty or fine.
Lawsuits and other administrative or legal proceedings that may arise in the course of our operations can involve substantial costs, including the costs associated with investigation, litigation and possible settlement, judgment, penalty or fine, as well as injunctive relief or other remedies that could adversely impact our operations.
If our assumptions regarding these risks and uncertainties, which we use to plan and operate our business, are incorrect or change, or if we do not address these risks successfully, our results of operations could differ materially from our expectations and our business, financial condition and results of operations would be adversely affected. 17 Table of Contents Our revenue growth rate has declined in recent periods and may continue to decrease in the future.
If our assumptions regarding these risks and uncertainties, which we use to plan and operate our business, are incorrect or change, or if we do not address these risks successfully, our results of operations could differ materially from our expectations and our business, financial condition and results of operations would be adversely affected. 17 Table of Contents Our recent growth rates may not be sustainable or indicative of future growth.
We do not generate a significant percentage of revenue from mail delivery service. To the extent consumer preferences change, including as a result of public health concerns, we may not be able to accommodate sufficient demand for mail delivery service which may have an adverse effect on our business, financial condition and results of operations.
To the extent consumer preferences change, including as a result of public health concerns or due to retail pharmacy closures, we may not be able to accommodate sufficient demand for mail delivery service which may have an adverse effect on our business, financial condition and results of operations.
All of these factors may be exacerbated by global financial conditions and other geopolitical factors, which could harm our business, financial condition and results of operations. 33 Table of Contents Economic factors such as increased insurance and healthcare costs, commodity prices, shipping costs, inflation, higher costs of labor, and changes in or interpretations of other laws, regulations and taxes may also increase our costs and make our offerings less competitive, increase general and administrative expenses, and otherwise adversely affect our financial condition and results of operations.
Economic factors such as increased insurance and healthcare costs, commodity prices, tariffs, shipping costs, inflation, higher costs of labor, and changes in or interpretations of other laws, regulations and taxes may also increase our costs and 33 Table of Contents make our offerings less competitive, increase general and administrative expenses, and otherwise adversely affect our financial condition and results of operations.
Even if issued, there can be no assurance that these patents will adequately protect our intellectual property or survive a legal challenge, as the legal standards relating to the validity, enforceability and scope of protection of patent and other intellectual property rights are uncertain. Our limited patent protection may restrict our ability to protect our technologies and processes from competition.
Even if issued, there can be no assurance that these patents will adequately protect our intellectual property or survive a legal challenge, as the legal standards relating to the validity, enforceability and scope of 38 Table of Contents protection of patent and other intellectual property rights are uncertain.
Moreover, the parties to our stockholders agreement, who also hold Class A and Class B common stock, own 95.6% of the combined voting power of our Class A and Class B common stock as of December 31, 2023.
Moreover, the parties to our stockholders agreement, who also hold Class A and Class B common stock, own approximately 94.8% of the combined voting power of our Class A and Class B common stock as of December 31, 2024 .
Climate change may increase the frequency and/or intensity of such events. For example, in certain areas, there has been an increase in power shutoffs associated with wildfire prevention.
Climate change may increase the frequency and/or intensity of such events or contribute to various chronic changes in meteorological and hydrological patterns. For example, in certain areas, there has been an increase in power shutoffs associated with wildfire prevention.
Such increased scrutiny may result in increased costs, changes in demands for certain products, enhanced compliance or disclosure obligations, or other adverse impacts on our business, financial condition, or results of operations. From time to time, we may create and publish voluntary disclosures regarding ESG matters. Identification, assessment, and disclosure of such matters is complex.
Such increased scrutiny may result in increased costs, changes in demands for certain products, enhanced compliance or disclosure obligations, or other adverse impacts on our business, financial condition, or results of operations. From time to time, we may engage in voluntary initiatives (such as policies, practices, or disclosures) regarding ESG matters.
Further, our amended and restated certificate of incorporation provides that the doctrine of “corporate opportunity” will not apply with respect to the parties to our stockholders agreement or their affiliates (other than us and our subsidiaries), and any of their respective principals, members, directors, partners, stockholders, officers, employees or other representatives (other than any such person who is also our employee or an employee of our subsidiaries), or any director or stockholder who is not employed by us or our subsidiaries.
Further, our amended and restated certificate of incorporation provides that the doctrine of “corporate opportunity” will not apply with respect to the parties to our stockholders agreement or their affiliates (other than us and our subsidiaries), and any of their respective principals, members, directors, partners, stockholders, officers, employees or other representatives (other than any such person who is also our employee or an employee of our subsidiaries), or any director or stockholder who is not employed by us or our subsidiaries. 46 Table of Contents Substantial future sales by the parties to our stockholders agreement or other holders of our common stock, or the perception that such sales may occur, could depress the price of our Class A common stock.
If we fail to follow such guidelines and policies properly, search engines may rank our content lower in search results or could remove our content altogether from their indices.
If we fail to follow such guidelines and policies properly, search engines may rank our content lower in search results or could remove our content altogether from their indices. Antitrust developments pertaining to search engines could also adversely impact the effectiveness of our content.
If we cannot develop or license technology for any allegedly infringing aspect of our business, we will be forced to limit our service and may be unable to compete effectively. Any of these events could materially harm our business, financial condition and results of operations.
If we cannot develop or license technology for any allegedly infringing aspect of our business, we will be forced to limit our service and may be unable to compete effectively.
To the extent a pandemic, epidemic or outbreak of an infectious disease, including COVID-19, adversely affects our business, financial condition and results of operations, it may also have the effect of heightening many of the other risks described in this Part I, Item 1A, “Risk Factors.” Our estimated addressable market is subject to inherent challenges and uncertainties.
To the extent a pandemic, epidemic or outbreak of an infectious disease, including COVID-19, adversely affects our business, financial condition and results of operations, it may also have the effect of heightening many of the other risks described in this Part I, Item 1A, “Risk Factors.” General economic factors, natural disasters or other unexpected events may adversely affect our business, financial performance and results of operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor more information regarding risks related to cybersecurity matters, please see Part I, Item 1A, “Risk Factors—We depend on our information technology systems, and those of our third-party vendors, contractors and consultants, and any failure or significant disruptions of these systems, security breaches or loss of data could materially adversely affect our business, financial condition and results of operations.” Cybersecurity Governance Our Board and its committees have an active role in overseeing risk management and they have delegated to the Compliance Committee oversight over our cybersecurity and data privacy risks.
Biggest changeFor more information regarding risks related to cybersecurity matters, please see Part I, Item 1A, “Risk Factors—We depend on our information technology systems, and those of our third-party vendors, contractors and consultants, and any failure or significant disruptions of these systems, security breaches or loss of data could materially adversely affect our business, financial condition and results of operations.” Cybersecurity Governance Our Board and its committees have an active role in overseeing risk management and they have delegated to the Audit and Risk Committee oversight over our cybersecurity and data privacy risks, including oversight of management’s implementation of our Cybersecurity and Privacy Programs, except to the extent direct oversight by the Board is required by the FTC Order.
These programs are integrated into, and form a part of, our overall enterprise risk management program, and share similar methodologies, reporting channels and governance processes to those that apply across the broader enterprise risk management framework.
These programs are integrated into, and form a part of, our overall risk management program, and share similar methodologies, reporting channels and governance processes to those that apply across the broader risk management framework.
In addition, at least once every twelve months and promptly after the occurrence of certain specified cybersecurity/data privacy incidents, the Board and our Interim Chief Executive Officer receive the written Cybersecurity and Privacy Program materials, which include the results of the most recent cybersecurity and privacy risk assessment and any evaluations thereof or updates thereto (collectively, the “Reporting Materials”).
In addition, at least once every twelve months and promptly after the occurrence of certain specified cybersecurity/data privacy incidents, the Board and our Chief Executive Officer and President receive the written Cybersecurity and Privacy Program materials, which include the results of the most recent cybersecurity and privacy risk assessment and any evaluations thereof or updates thereto (collectively, the “Reporting Materials”).
The Compliance Committee receives periodic reports from management regarding cybersecurity and privacy risks, any material updates thereto and a summary of any cybersecurity and/or privacy events or incidents that have occurred, in each case, since the most recent update provided to the Compliance Committee.
The Audit and Risk Committee receives periodic reports from management regarding cybersecurity and privacy risks, any material updates thereto and a summary of any cybersecurity and/or privacy events or incidents that have occurred, in each case, since the most recent update provided to the Audit and Risk Committee.
Our Cybersecurity and Privacy Programs include: • Teams responsible for managing security and privacy controls, risk assessments, and responding to cybersecurity incidents; • Security and privacy awareness training of our employees; • Privacy and security risk assessments designed to identify material privacy and/or cybersecurity risks to our systems, processes, and assets; • The use of external service providers to assist with privacy and security controls, including vulnerability management; • An incident response plan with trained personnel and personnel that are trained to execute the plan; and, • A third-party risk management process for service providers and vendors.
Key elements of our Cybersecurity and Privacy Programs include, bu t are not limited to the following : • Teams responsible for managing security and privacy controls, risk assessments, and responding to cybersecurity incidents; • Security and privacy awareness training of our employees; • Privacy and security risk assessments designed to identify material privacy and/or cybersecurity risks to our systems, processes, and assets; • The use of external service providers to assist with privacy and security controls, including vulnerability management; • An incident response plan with trained personnel and personnel that are trained to execute the plan; and, • A third-party risk management process for service providers and vendors.
The Compliance Committee oversees management’s implementation of our Cybersecurity and Privacy Programs, except to the extent direct oversight by the Board is required by the FTC Order.
The Audit and Risk Committee oversees management’s implementation of our Cybersecurity and Privacy Programs, except to the extent direct oversight by the Board is required by the FTC Order.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected us , including our operations, business strategy, results of operations, or financial condition.
The Compliance Committee reports to the full Board regarding its activities, including those related to cybersecurity and privacy.
The Audit and Risk Committee reports to the full Board regarding its activities, including those related to cybersecurity and privacy.
Under the Cybersecurity and Privacy Programs, our Security Team monitors, prevents, detects, mitigates, and remediates cybersecurity risks and incidents via various means, including monitoring threat intelligence from various sources, internal and external vulnerability management, and alerts and reports produced by security tools.
Under the Cybersecurity and Privacy Programs, our Security Team monitors, prevents, detects, mitigates, and remediates cybersecurity risks and incidents via various means, including monitoring threat intelligence from various sources, internal and external vulnerability management, and alerts and reports produced by security tools. Reporting of such risks is regularly provided to the Board and the Audit and Risk Committee, as applicable.
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The Security Team’s experience includes various industry certifications (e.g., CISSP, CISM, CCSP, CISA, etc.), and industry experience (e.g., healthcare, technology, critical infrastructure, etc.).
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Our Security Team is composed of certified cybersecurity professionals responsible for assessing and managing cybersecurity risks, led by the Senior Director of Information Security & Compliance.
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Reporting of such risks is regularly provided to the Board and the Compliance Committee, as applicable. 53 Table of Contents
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The qualifications of our Security Team include the following industry-recognized certifications: ISC2 Certified Information Systems Security Professional (CISSP), Certified Ethical Hacker (C|EH), Certified Incident Handler (GCIH), Certified Intrusion Analyst (GCIA), GSEC, CompTIA Security+, A+ Network+, CISM, CCSK, MCSA, MCSE, MCP, MCT, and Cisco Certified Network Associate (CCNA).
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The Senior Director of Information Security & Compliance reports to our Chief Technology Officer, who has over 19 years of experience in information technology. The Senior Director of Information Security & Compliance brings over 13 years of experience in risk management, cybersecurity and compliance.
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The Security 54 Table of Contents Team’s experience in information security and cybersecurity spans across various industries, including healthcare, technology, and critical infrastructure.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Our corporate headquarters is located in Santa Monica, California, where we lease approximately 74,000 square feet of space under a lease expiring in 2031. We also maintain smaller satellite offices across the United States, including in San Francisco, California, Charleston, South Carolina, Asheville, North Carolina, St. Louis, Missouri, New Albany, Ohio and New York, New York.
Biggest changeItem 2. Properties. Our corporate headquarters is located in Santa Monica, California, where we lease approximately 74,000 square feet of space under a lease expiring in 2031 . We also maintain smaller satellite offices across the United States, including in San Francisco, California, Charleston, South Carolina, Asheville, North Carolina, New Albany, Ohio and New York, New York.
The information required under this Item 3 is set forth in Note 13 within “Notes to Consolidated Financial Statements” included in Part IV, Item 15 of this report and is incorporated herein by this reference. Item 4. Mine Safety Disclosures. Not applicable. 54 Table of Contents PART II
The information required under this Item 3 is set forth in Note 13 within “Notes to Consolidated Financial Statements” included in Part IV, Item 15 of this report and is incorporated herein by this reference. Item 4. Mine Safety Disclosures. Not applicable. 55 Table of Contents PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePerformance Graph The following performance graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, or otherwise subject to the liabilities under the Securities Act or Exchange Act, except to the extent that we specifically incorporate it by reference into such filing. 55 Table of Contents The following graph depicts the total cumulative stockholder return on our Class A common stock from September 23, 2020, the first day of trading of our Class A common stock on the Nasdaq Global Select Market, through December 31, 2023, relative to the performance of the Nasdaq Composite Index and the two industries we intersect, namely, the Dow Jones Internet Services Index and S&P 500 Healthcare Index.
Biggest changePerformance Graph The following performance graph and related information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information be incorporated by reference into any future filing under the Securities Act or the Exchange Act, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing, or otherwise subject to the liabilities under the Securities Act or Exchange Act, except to the extent that we specifically incorporate it by reference into such filing.
The graph assumes an initial investment of $100 at the close of trading on September 23, 2020 and that all dividends paid by companies included in these indices have been reinvested. The performance shown in the graph below is not intended to forecast or be indicative of future stock price performance.
The graph assumes an initial investment of $100 at the close 56 Table of Contents of trading on September 23, 2020 and that all dividends paid by companies included in these indices have been reinvested. The performance shown in the graph below is not intended to forecast or be indicative of future stock price performance.
As of December 31, 2023, we had $605.5 million of remaining net proceeds from our IPO which have been invested in investment grade, interest-bearing instruments. Item 6. [Reserved.] 56 Table of Contents
As of December 31, 2024 , we had $300.5 million estimated remaining net proceeds from our IPO which have been invested in investment grade, interest-bearing instruments. Item 6. [Reserved.] 57 Table of Contents
Recent Sales of Unregistered Securities; Purchases of Equity Securities by the Issuer or Affiliated Purchaser We did not sell any equity securities during the year ended December 31, 2023 that were not registered under the Securities Act. The following table presents information with respect to our repurchases of Class A common stock during the three months ended December 31, 2023.
Recent Sales of Unregistered Securities; Purchases of Equity Securities by the Issuer or Affiliated Purchaser We did not sell any equity securities during the year ended December 31, 2024 that were not registered under the Securities Act. There were no repurchases of our Class A common stock during the three months ended December 31, 2024 .
As of December 31, 2023, we estimated we had used approximately $281.4 million of the net proceeds from our IPO: (i) $164.4 million for the acquisition of businesses that complement our business and (ii) $117.0 million for the repurchases of our Class A common stock.
As of December 31, 2024 , we estimated we had used approximatel y $586.4 million of the net proceeds from our IPO: (i) $164.4 million for the acquisition of businesses that complement our business; (ii) $262.0 million for the repurchases of our Class A common stock; and (iii) $160.0 million for the repayment of our outstanding debt obligations.
See Note 14 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information related to our old stock repurchase program, which was approved by our Board on February 23, 2022 and announced on February 28, 2022, in addition to our new stock repurchase program effective subsequent to December 31, 2023, which was approved by our Board on February 27, 2024 and announced on February 29, 2024.
See Note 14 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information related to our current $450.0 million stock repurchase program with no expiration date, which was publicly announced on February 29, 2024.
There is no established public trading market for our Class B common stock. Holders As of February 20, 2024, there were 7 holders of record of our Class A common stock and 10 holders of record of our Class B common stock. Dividend Policy We are a holding company that does not conduct any business operations of our own.
There is no established public trading market for our Class B common stock. Holders As of February 18, 2025 , there wer e 7 holders of record of our Class A common stock and 10 ho lders of record of our Class B common stock.
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Period Total Number of Shares Repurchased (1) Average Price Paid per Share (2) Total Number of Shares Repurchased as Part of Publicly Announced Program (1) Approximate Dollar Value of Shares that May Yet Be Repurchased Under the Program (in thousands) October 1 -31 — $ — — $ — November 1 - 30 13,058,343 $ 5.50 13,058,343 $ 50,309 December 1 - 31 1,003,953 $ 5.98 1,003,953 $ 44,305 Total 14,062,296 14,062,296 _____________________________________________________ (1) The repurchases are being executed from time to time, subject to general business and market conditions and other investment opportunities, through open market purchases or privately negotiated transactions, which may include repurchases through Rule 10b5-1 plans.
Added
Dividend Policy We are a holding company that does not conduct any business operations of our own.
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(2) Average price paid per share includes direct costs and estimated excise taxes associated with the repurchases.
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The following graph depicts the total cumulative stockholder return on our Class A common stock from September 23, 2020 , the first day of trading of our Class A common stock on the Nasdaq Global Select Market, through December 31, 2024 , relative to the performance of the Nasdaq Composite Index and the two industries we intersect, namely, the Dow Jones Internet Services Index and S&P 500 Healthcare Index.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

65 edited+20 added−47 removed35 unchanged
Biggest changeAs a result, all consumer discounts subsequent to this change are expected to be recognized as a reduction of prescription transactions revenue. 60 Table of Contents Results of Operations The following table sets forth our results of operations for the years ended December 31, 2023 and 2022: (dollars in thousands) Year Ended December 31, 2023 % of Total Revenue Year Ended December 31, 2022 % of Total Revenue Change ($) Change (%) Revenue: Prescription transactions revenue $ 550,738 73% $ 550,536 72% $ 202 0% Subscription revenue 94,410 13% 96,167 13% (1,757) (2%) Pharma manufacturer solutions revenue (1) 85,065 11% 99,425 13% (14,360) (14%) Other revenue 20,052 3% 20,426 3% (374) (2%) Total revenue 750,265 766,554 Costs and operating expenses: Cost of revenue, exclusive of depreciation and amortization presented separately below 66,925 9% 65,079 8% 1,846 3% Product development and technology 135,836 18% 143,137 19% (7,301) (5%) Sales and marketing 341,328 45% 357,631 47% (16,303) (5%) General and administrative 125,515 17% 144,792 19% (19,277) (13%) Depreciation and amortization 107,668 14% 54,177 7% 53,491 99% Total costs and operating expenses 777,272 764,816 Operating (loss) income (27,007) 1,738 Other expense, net: Other expense (4,008) 1% — 0% (4,008) n/m Interest income 32,171 4% 9,274 1% 22,897 247% Interest expense (56,728) 8% (34,243) 4% (22,485) 66% Total other expense, net (28,565) (24,969) Loss before income taxes (55,572) (23,231) Income tax benefit (expense) 46,704 6% (9,597) 1% 56,301 (587%) Net loss $ (8,868) $ (32,828) _____________________________________________________ (1) Pharma manufacturer solutions revenue for the year ended December 31, 2023 included a $10.0 million contract termination payment to a pharma manufacturer solutions client in connection with our Restructuring Plan, which was recognized as a reduction of revenue.
Biggest changeResults of Operations The following table sets forth our results of operations for the years ended December 31, 2024 and 2023 : (dollars in thousands) Year Ended December 31, 2024 % of Total Revenue Year Ended December 31, 2023 % of Total Revenue Change ($) Change (%) Revenue: Prescription transactions revenue $ 577,549 73% $ 550,738 73% $26,811 5% Subscription revenue 86,536 11% 94,410 13% (7,874) (8%) Pharma manufacturer solutions revenue 107,237 14% 85,065 11% 22,172 26% Other revenue 21,002 3% 20,052 3% 950 5% Total revenue 792,324 750,265 Costs and operating expenses: Cost of revenue, exclusive of depreciation and amortization presented separately below 48,215 6% 66,925 9% (18,710) (28%) Product development and technology 123,749 16% 135,836 18% (12,087) (9%) Sales and marketing 367,114 46% 341,328 45% 25,786 8% General and administrative 117,862 15% 125,515 17% (7,653) (6%) Depreciation and amortization 69,538 9% 107,668 14% (38,130) (35%) Total costs and operating expenses 726,478 777,272 Operating income (loss) 65,846 (27,007) Other expense, net: Other expense (2,660) —% (4,008) 1% 1,348 (34%) Loss on extinguishment of debt (2,077) —% — 0% (2,077) n/m Interest income 23,273 3% 32,171 4% (8,898) (28%) Interest expense (52,922) 7% (56,728) 8% 3,806 (7%) Total other expense, net (34,386) (28,565) Income (loss) before income taxes 31,460 (55,572) Income tax (expense) benefit (15,070) 2% 46,704 6% (61,774) (132%) Net income (loss) $ 16,390 $ (8,868) Revenue Prescription transactions revenue increased $26.8 million , or 5% , year-over-year, primarily as a result of a 7% increase in the number of our average Monthly Active Consumers from organic growth, including expansion of our integrated savings program, which integrates our discounts and pricing in a seamless experience over the pharmacy counter for eligible plan members served by certain PBM partners .
Our future capital requirements will depend on many factors, including the growth of our business, the timing and extent of investments, sales and marketing activities, and many other factors as described in Part I, Item 1A, “Risk Factors.” For additional information regarding our cash requirements from noncancelable operating lease obligations, terms and commitments under our debt arrangements including our term loan and revolving credit facility, and other commitments and contingencies, see Note 10, Note 12 and Note 13 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K, respectively.
Our future capital requirements will depend on many factors, including the growth of our business, the timing and extent of investments, sales and marketing activities, and many other factors as described in Part I, Item 1A, “Risk Factors.” For additional information regarding our cash requirements from noncancelable operating lease obligations, terms and commitments under our debt arrangements including our term loan and revolving credit facility, and other commitments and contingencies, see 63 Table of Contents Note 10 , Note 12 and Note 13 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K, respectively.
Revenue, net loss and net loss margin are financial measures prepared in conformity with accounting principles generally accepted in the United States ("GAAP"). Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures.
Revenue, net income (loss) and net income (loss) margin are financial measures prepared in conformity with accounting principles generally accepted in the United States ("GAAP"). Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures.
We define Adjusted EBITDA for a particular period as net income or loss before interest, taxes, depreciation and amortization, and as further adjusted, as applicable, for acquisition related expenses, stock-based compensation expense, payroll tax expense related to stock-based compensation, loss on extinguishment of debt, financing related expenses, loss on operating lease assets, restructuring related expenses, legal settlement expenses, charitable stock donation, gain on sale of business and other income or expense, net.
We define Adjusted EBITDA for a particular period as net income or loss before interest, taxes, depreciation and amortization, and as further adjusted, as applicable, for acquisition related expenses, stock-based compensation expense, payroll tax expense related to stock-based compensation, loss on extinguishment of debt, financing related expenses, loss on operating lease assets, restructuring related expenses, legal settlement expenses , gain on sale of business and other income or expense, net.
As of December 31, 2022 and 2021, we maintained a full valuation allowance against our net deferred tax assets in excess of amortizable goodwill as the objectively verifiable negative evidence outweighed the positive evidence. We determined it was more likely than not that our deferred tax assets would not be realized.
As of December 31, 2022, we maintained a full valuation allowance against our net deferred tax assets in excess of amortizable goodwill as the objectively verifiable negative evidence outweighed the positive evidence. We determined it was more likely than not that our deferred tax assets would not be realized.
We exited the fourth quarter of 2023 with over 7 million prescription-related consumers that used GoodRx across our prescription transactions and subscription offerings. Our prescription-related consumers represent the sum of Monthly Active Consumers for the three months ended December 31, 2023 and subscribers to our subscription plans as of December 31, 2023.
We exited the fourth quarter of 2024 with over 7 million prescription-related consumers that used GoodRx across our prescription transactions and subscription offerings. Our prescription-related consumers represent the sum of Monthly Active Consumers for the three months ended December 31, 2024 and subscribers to our subscription plans as of December 31, 2024 .
For a reconciliation and presentation of Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin to the most directly comparable GAAP financial measures, information about why we consider Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin useful and a discussion of the material risks and limitations of 57 Table of Contents these measures, please see “Key Financial and Operating Metrics—Non-GAAP Financial Measures" included within this Part II, Item 7 of this Annual Report on Form 10-K.
For a reconciliation and presentation of Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin to the most directly comparable GAAP financial measures, information about why we consider Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin useful and a discussion of the material risks and limitations of these measures, please see “Key Financial and Operating Metrics—Non-GAAP Financial Measures" included within this Part II, Item 7 of this Annual Report on Form 10-K.
These covenants provide for certain exceptions for specific types of payments. Based on these restrictions, all of the net assets of GoodRx, Inc. were restricted pursuant to the terms of our debt arrangements as of December 31, 2023.
These covenants provide for certain exceptions for specific types of payments. Based on these restrictions, all of the net assets of GoodRx, Inc. were restricted pursuant to the terms of our debt arrangements as of December 31, 2024 .
For consumer discounts on prescription drugs with PBMs as our customers, we evaluate whether such discounts represent payments to a customer, which are recognized as a reduction of prescription transactions revenue if no distinct benefit is received, or whether the discounts relate to limited marketing promotions, which are recognized as sales and marketing expenses.
For consumer discounts on prescription drugs with PBMs as our customers, we evaluate whether such discounts represent payments to a customer, which are recognized as a reduction of prescription transactions revenue if no distinct 60 Table of Contents benefit is received, or whether the discounts relate to limited marketing promotions, which are recognized as sales and marketing expenses.
If we are unable to raise additional funds when or on the terms desired, our business, financial condition and results of operations could be adversely affected. 63 Table of Contents Holding Company Status GoodRx Holdings, Inc. is a holding company that does not conduct any business operations of its own.
If we are unable to raise additional funds when or on the terms desired, our business, financial condition and results of operations could be adversely affected. Holding Company Status GoodRx Holdings, Inc. is a holding company that does not conduct any business operations of its own.
A valuation allowance is established if it is more likely than not that all or a portion of deferred tax assets will not be realized. The determination of whether a valuation allowance should be established, as well as the amount of such allowance, requires significant judgment and estimates, including estimates of future earnings.
A valuation allowance is established if it is more likely than not that all or a portion of deferred tax assets will not be realized. The determination of whether a valuation allowance should be 65 Table of Contents established, as well as the amount of such allowance, requires significant judgment and estimates, including estimates of future earnings.
Net cash used in investing activities Net cash used in investing activities primarily consists of cash used for software development costs, capital expenditures, and acquisitions and investments that we may make from time to time.
Net cash used in investing activities Net cash used in investing activities primarily consists of cash used for software development costs and capital expenditures, and may also include cash used for acquisitions and investments that we may make from time to time.
The changes in operating assets and liabilities were primarily driven by the timing of income tax payments and refunds, as well as by the timing of payments of accounts payable and accrued expenses and collections of accounts receivable.
The changes in operating assets and liabilities were primarily driven by the timing of income tax payments and refunds, as well as by the timing of payments of accounts payable and collections of accounts receivable.
Additional positive evidence reviewed included (i) stock options granted that will expire 10 years from the date of grant if unexercised; and (ii) an indefinite carryforward period for certain deferred tax assets.
A dditional positive evidence reviewed included (i) stock options granted that will expire 10 years from the date of grant if unexercised; and (ii) an indefinite carryforward period for certain deferred tax assets.
Net cash used in financing activities Net cash used in financing activities primarily consists of payments related to our debt arrangements, repurchases of our Class A common stock, and net share settlement of equity awards, partially offset by proceeds from employees' exercise of stock options and from our employee stock purchase plan.
Net cash used in financing activities Net cash used in financing activities primarily consists of payments related to our debt arrangements, repurchases of our Class A common stock, and net share settlement of equity awards, partially offset by debt borrowings, and proceeds from exercise of stock options as well as our employee stock purchase plan.
A discussion of the year ended December 31, 2022 compared to the year ended December 31, 2021 has been reported previously in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on March 1, 2023, under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Overview Our mission is to help Americans get the healthcare they need at a price they can afford.
A discussion of the year ended December 31, 2023 compared to the year ended December 31, 2022 has been reported previously in our Annual Report on Form 10-K for the year ended December 31, 2023 filed with the SEC on February 29, 2024 , under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Overview Our mission is to help Americans get the healthcare they need at a price they can afford.
Actual results could differ significantly from our estimates. An accounting policy is deemed critical if it is both important to the portrayal of our financial condition and results and requires us to make difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain.
An accounting policy is deemed critical if it is both important to the portrayal of our financial condition and results and requires us to make difficult, subjective, or complex judgments, often as a result of the need to make estimates about the effects of matters that are inherently uncertain.
Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of Adjusted Revenue. Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures and are presented for supplemental informational purposes only and should not be considered as alternatives or substitutes to financial information presented in accordance with GAAP.
Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are non-GAAP financial measures and are presented for supplemental informational purposes only and should not be considered as alternatives or substitutes to financial information presented in accordance with GAAP.
For our integrated savings programs, we may experience stronger prescription transactions revenue during the first half of each year since more claims are likely to be routed through GoodRx while plan members are in the deductible phase of their health plans.
For our integrated savings program, we may experience stronger traffic during the first half of each year since more claims are likely to be routed through GoodRx while plan members are in the deductible phase of their health plans.
Three Months Ended (in millions) December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 Monthly Active Consumers 6.4 6.1 6.1 6.1 5.9 5.8 5.8 6.4 Subscription Plans Subscription plans have been impacted by a sequential decline in our subscription plans for Kroger Savings as a result of reduced marketing spend in relation to that offering.
Monthly Active Consumers Three Months Ended (in millions) December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 Monthly Active Consumers 6.6 6.5 6.6 6.7 6.4 6.1 6.1 6.1 Subscription Plans Subscription plans have been impacted by a sequential decline in our subscription plans for Kroger Savings as a result of reduced marketing spend in relation to that offering, which sunset in July 2024.
As of December 31, 2023, we had cash and cash equivalents of $672.3 million and $90.8 million available under our revolving credit facility. For additional information regarding our revolving credit facility and our term loan, see Note 12 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
As of December 31, 2024 , we had cash and cash equivalents of $448.3 million and $91.7 million available under our revolving credit facility. For additional information regarding our revolving credit facility and our term loan, see Note 12 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
In 2023, positive evidence reviewed included sustained tax profitability (pre-tax earnings or losses adjusted for permanent book to tax differences), which was objective and verifiable, and anticipated future earnings. The sustained trend of tax profitability realized began in 2022 and continued through the end of 2023.
In 2023, our determination changed, as the objectively verifiable positive evidence outweighed the negative evidence. Positive evidence reviewed included sustained tax profitability (pre-tax earnings or losses adjusted for permanent book to tax differences), which was objective and verifiable, and anticipated future earnings. The sustained trend of tax profitability realized began in 2022 and has continued through the end of 2023.
The preparation of consolidated financial statements also requires us to 64 Table of Contents make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances.
The preparation of consolidated financial statements also requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, costs and expenses and related disclosures. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results could differ significantly from our estimates.
As of (in thousands) December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022 June 30, 2022 March 31, 2022 Subscription plans 884 930 969 1,007 1,030 1,060 1,133 1,203 Non-GAAP Financial Measures Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are key measures we use to assess our financial performance and are also used for internal planning and forecasting purposes.
As of (in thousands) December 31, 2024 September 30, 2024 June 30, 2024 March 31, 2024 December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 Subscription plans 684 701 696 778 884 930 969 1,007 Non-GAAP Financial Measures Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are key measures we use to assess our financial performance and are also used for internal planning and forecasting purposes.
As of December 31, 2023, we continue to believe that our net deferred taxes with the exception of certain standalone tax filings' net deferred tax assets will be realized.
As of December 31, 2024 and 2023, we continued to believe that our net deferred taxes with the exception of certain standalone tax filings' net deferred tax assets would be realized.
We believe Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are helpful to investors, analysts and other interested parties because they can assist in providing a more consistent and comparable overview of our operations across our historical financial periods.
We believe Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin are helpful to investors, analysts and other interested parties because they can assist in providing a more consistent and comparable overview of our operations across our historical financial periods. In addition, these measures are frequently used by analysts, investors and other interested parties to evaluate and assess performance.
We apply judgment to consider the relative impact of negative and positive evidence and the weight given to negative and positive evidence is commensurate with the extent to which such evidence can be objectively verified.
The positive evidence described above continued to hold through the end of 2024. We apply judgment to consider the relative impact of negative and positive evidence and the weight given to negative and positive evidence is commensurate with the extent to which such evidence can be objectively verified.
The valuations of intangible assets and contingent consideration use different valuation methods depending on the asset acquired and underlying nature of the contingency and may include significant estimates and judgments.
The valuations of intangible assets and contingent consideration use different valuation methods depending on the asset acquired and underlying nature of the contingency and may include significant estimates and judgments. During 2022, we acquired vitaCare Prescription Services, Inc.
(4) Acquisition related expenses principally include costs for actual or planned acquisitions including related third party fees, legal, consulting and other expenditures, and as applicable, severance costs and retention bonuses to employees related to acquisitions and change in fair value of contingent consideration.
(2) Acquisition related expenses principally include costs for actual or planned acquisitions including related third party fees, legal, consulting and other expenditures, and as applicable, severance costs and retention bonuses to employees related to acquisitions and change in fair value of contingent consideration. From time to time, acquisition related expenses may also include similar transaction related costs for business dispositions.
Income Taxes In 2023, we had an income tax benefit of $46.7 million compared to an income tax expense of $9.6 million in 2022 and an effective income tax rate of 84.0% and (41.3%), respectively.
Income Taxes In 2024, we had an income tax expense of $15.1 million compared to an income tax benefit of $46.7 million in 2023 and an effective income tax rate of 47.9% and 84.0% , respectively.
(10) Net loss margin represents net loss as a percentage of revenue. (11) Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of Adjusted Revenue. Components of our Results of Operations For a description of the components of our results of operations, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Components of our Results of Operations For a description of the components of our results of operations, see Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
Cash Flows Year Ended December 31, (in thousands) 2023 2022 Net cash provided by operating activities $ 138,292 $ 146,780 Net cash used in investing activities (55,766) (210,498) Net cash used in financing activities (167,395) (120,226) Net change in cash and cash equivalents $ (84,869) $ (183,944) Net cash provided by operating activities Net cash provided by operating activities consists of net loss adjusted for certain non-cash items and changes in assets and liabilities.
Cash Flows Year Ended December 31, (in thousands) 2024 2023 Net cash provided by operating activities $ 183,892 $ 138,292 Net cash used in investing activities (70,347) (55,766) Net cash used in financing activities (337,495) (167,395) Net change in cash and cash equivalents $ (223,950) $ (84,869) Net cash provided by operating activities Net cash provided by operating activities consists of net income (loss) adjusted for certain non-cash items and changes in assets and liabilities.
Recent Accounting Pronouncements See Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information on certain accounting standards adopted in 2023 and recent accounting announcements that have not yet been required to be implemented and may be applicable to our future operations.
Recent Accounting Pronouncements See Note 2 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further information on certain accounting standards adopted in 2024 and recent accounting announcements that have not yet been required to be implemented and may be applicable to our future operations. 64 Table of Contents Critical Accounting Policies and Estimates Our audited consolidated financial statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K are prepared in accordance with GAAP.
Our revenue is primarily derived from prescription transactions revenue that is generated when pharmacies fill prescriptions for consumers, and from other revenue streams such as pharma manufacturer solutions, our subscription offerings, and our telehealth services. We consider PBMs, pharma manufacturers and consumers of our subscription and telehealth services, for which we have direct contractual agreements, to be our primary customers.
Our revenue is primarily derived from prescription transactions revenue that is generated when pharmacies fill prescriptions for consumers, and from other revenue streams such as pharma manufacturer solutions, our subscription offerings, and our telehealth services.
The year-over-year change in our income taxes was primarily due to the tax benefit from the release of our valuation allowance against our beginning of the year net deferred tax assets in excess of tax amortizable goodwill, partially offset by a decrease in our U.S. federal and state research and development tax credits.
The year-over-year change in our income taxes was primarily due to the tax benefit recognized in 2023 from the release of our valuation allowance against our beginning of the year net deferred tax assets in excess of tax amortizable goodwill.
A change in the estimated risk of the acquired companies' cash flows would change the discount rates applied, which in turn could significantly affect the valuation of our acquired developed technology and customer relationships intangible assets.
The discount rates reflected the perceived risk of each forecast, which required significant judgment. A change in the estimated risk of the cash flows would have changed the discount rates applied, which in turn could have significantly affected the valuation of our acquired developed technology, customer relationships intangible assets, and the contingent consideration receivable.
The $8.5 million decrease in net cash provided by operations in 2023 compared to 2022 was due to $24.0 million decrease in net loss, offset by a decrease of $30.8 million in non-cash adjustments and an increase of $1.6 million in cash outflow from changes in operating assets and liabilities.
The $45.6 million year-over-year increase in net cash provided by operations was due to an increase in earnings after adjusting for non-cash adjustments and a decrease of $24.0 million in cash outflow from changes in operating assets and liabilities.
Subscription revenue decreased $1.8 million, or 2%, year-over year, primarily driven by a decrease in the number of subscription plans due to the anticipated sunset of Kroger Savings, resulting in 884 thousand subscription plans as of December 31, 2023, compared to 1,030 thousand as of December 31, 2022, substantially offset by the effects of the pricing increase for Gold subscribers in the first half of 2022.
Subscription revenue decreased $7.9 million , or 8% , year-over year, primarily driven by a decrease in the number of subscription plans due to the sunset of Kroger Savings resulting in 684 thousand subscription plans as of December 31, 2024 compared to 884 thousand as of December 31, 2023 .
Liquidity and Capital Resources Since our inception, we have financed our operations primarily through net cash provided by operating activities, equity issuances, and borrowings under our long-term debt arrangements. Our principal sources of liquidity are our cash and cash equivalents and borrowings available under our $100.0 million secured revolving credit facility which expires on October 11, 2024.
Liquidity and Capital Resources Since our inception, we have financed our operations primarily through net cash provided by operating activities, equity issuances, and borrowings under our long-term debt arrangements.
(5) Restructuring related expenses include employee severance and other personnel related costs in connection with various workforce optimization and organizational changes to better align with our strategic goals and future scale.
(3) Restructuring related expenses include costs for various workforce optimization and organizational changes to better align with our strategic goals and future scale including employee severance and other personnel related costs, contract termination costs, and losses from the disposal of certain technology and certain capitalized software.
Product development and technology Product development and technology expenses are primarily driven by changes in headcount and investments to support and develop our various products. We capitalize certain qualified costs related to the development of internal-use software, which may cause product development and technology expenses to vary from period to period.
We capitalize c ertain qualified costs related to the development of internal-use software, which may cause product development and technology expenses to vary from period to period.
We expect to increase direct contractual relationships with more pharmacies in proportion to existing contractual agreements with our PBM partners in the near term. Prior to December 2023, we provided consumer incentives principally in the form of discounts to a limited number of consumers on a limited number of prescription drugs for a limited time ("limited marketing promotions").
Prior to December 2023, we provided consumer incentives principally in the form of discounts to a limited number of consumers on a limited number of prescription drugs for a limited time ("limited marketing promotions"). Consumer discounts on prescription drugs with partner pharmacies as our customers were recognized as a reduction of prescription transactions revenue.
The following table presents a reconciliation of net loss and revenue, the most directly comparable financial measures calculated in accordance with GAAP, to Adjusted EBITDA and Adjusted Revenue, respectively, and presents net loss margin, the most directly comparable financial measure calculated in accordance with GAAP, with Adjusted EBITDA Margin: Year Ended December 31, (dollars in thousands) 2023 2022 Net loss $ (8,868) $ (32,828) Adjusted to exclude the following: Interest income (32,171) (9,274) Interest expense 56,728 34,243 Income tax (benefit) expense (46,704) 9,597 Depreciation and amortization (1) 107,668 54,177 Other expense (2) 4,008 — Financing related expenses (3) — 20 Acquisition related expenses (4) 1,777 26,486 Restructuring related expenses (5) 27,023 6,273 Legal settlement expenses (6) 100 1,500 Stock-based compensation expense 104,820 120,234 Payroll tax expense related to stock-based compensation 1,693 1,882 Loss on operating lease assets (7) 1,353 12,569 Gain on sale of business (8) — (11,404) Adjusted EBITDA $ 217,427 $ 213,475 Revenue $ 750,265 $ 766,554 Adjusted to exclude the following: Client contract termination costs (9) 10,000 — Adjusted Revenue $ 760,265 $ 766,554 Net loss margin (10) (1.2 %) (4.3 %) Adjusted EBITDA Margin (11) 28.6 % 27.8 % _____________________________________________________ (1) Depreciation and amortization for the year ended December 31, 2023 included $46.7 million of amortization related to certain intangible assets in connection with the Restructuring Plan, which were accelerated through December 31, 2023, the date the Restructuring Plan was substantially complete.
The following table presents a reconciliation of net income (loss) and revenue, the most directly comparable financial measures calculated in accordance with GAAP, to Adjusted EBITDA and Adjusted Revenue, respectively, and presents net income (loss) margin, the most directly comparable financial measure calculated in accordance with GAAP, with Adjusted EBITDA Margin: 59 Table of Contents Year Ended December 31, (dollars in thousands) 2024 2023 Net income (loss) $ 16,390 $ (8,868) Adjusted to exclude the following: Interest income (23,273) (32,171) Interest expense 52,922 56,728 Income tax expense (benefit) 15,070 (46,704) Depreciation and amortization 69,538 107,668 Other expense 2,660 4,008 Loss on extinguishment of debt 2,077 — Financing related expenses (1) 898 — Acquisition related expenses (2) 557 1,777 Restructuring related expenses (3) 8,902 27,023 Legal settlement expenses (4) 13,000 100 Stock-based compensation expense 99,026 104,820 Payroll tax expense related to stock-based compensation 2,471 1,693 Loss on operating lease assets (5) — 1,353 Adjusted EBITDA $ 260,238 $ 217,427 Revenue $ 792,324 $ 750,265 Adjusted to exclude the following: Client contract termination costs — 10,000 Adjusted Revenue $ 792,324 $ 760,265 Net income (loss) margin 2.1% (1.2%) Adjusted EBITDA Margin 32.8% 28.6% _____________________________________________________ (1) Financing related expenses include third party fees related to proposed financings.
We exclude these costs from revenue because we believe they are not indicative of past or future underlying performance of the business.
We define Adjusted Revenue for a particular period as revenue excluding client contract termination costs associated with restructuring related activities. We exclude these costs from revenue because we believe they are not indicative of past or future underlying performance of the business.
Given the subscription fee is higher for Gold relative to Kroger Savings, we expect the anticipated sunset of Kroger Savings will result in a higher decline in subscription plans relative to subscription revenue.
Kroger Savings contributed $9.0 million of subscription revenue in 2023 and $1.1 million in 2024 . Given the subscription fee is higher for Gold relative to Kroger Savings, the sunset of Kroger Savings resulted in a higher year-over-year decline in subscription plans relative to subscription revenue.
Key Financial and Operating Metrics We use Monthly Active Consumers, subscription plans, Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin to assess our performance, make strategic and offering decisions and build our financial projections.
See Note 19 in the notes to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K. 58 Table of Contents Key Financial and Operating Metrics We use Monthly Active Consumers, subscription plans, Adjusted Revenue, Adjusted EBITDA and Adjusted EBITDA Margin to assess our performance, make strategic and offering decisions and build our financial projections.
Sales and marketing Sales and marketing expenses are primarily driven by investments to grow and retain our consumer base and may fluctuate based on the timing of our investments in consumer acquisition and retention.
The impact from these drivers was partially offset by a $4.3 million increase in third-party services and contractors associated with product development and allocated overhead. Sales and marketing Sales and marketing expenses are primarily driven by investments to grow and retain our consumer base and may fluctuate based on the timing of our investments in consumer acquisition and retention.
Our critical accounting estimates are primarily those relating to forecasts of revenue and margins and estimates of royalty and discount rates, as applicable, used in the valuation of developed technology and customer relationships intangible assets and the contingent consideration receivable.
("vitaCare") and our critical accounting estimates at the date of acquisition related to assumptions used in the valuation of developed technology and customer relationships intangible assets and the contingent consideration receivable.
General and administrative General and administrative expenses are primarily driven by changes in headcount and investments to support our compliance and reporting obligations as a public company. General and administrative expenses may vary from period to period based on the timing and extent of business mergers, acquisitions and dispositions, to support our organic growth, and financing activities.
General and administrative expenses may vary from period to period based on the timing and extent of business mergers, acquisitions and dispositions, to support our organic growth, and financing activities. Impairments and disposals of long-lived assets may also cause general and administrative expenses to fluctuate period to period.
For the year ended December 31, 2023 as compared to the year ended December 31, 2022: • Revenue decreased 2% to $750.3 million (which was impacted by $10.0 million of client contract termination costs incurred in connection with the Restructuring Plan) from $766.6 million; • Adjusted Revenue decreased 1% to $760.3 million (which represents revenue excluding the $10.0 million of client termination costs incurred in connection with the Restructuring Plan, which was recognized as a reduction of revenue) from $766.6 million; • Net loss and net loss margin were $8.9 million and 1.2%, respectively, compared to net loss and net loss margin of $32.8 million and 4.3%, respectively; and • Adjusted EBITDA and Adjusted EBITDA Margin were $217.4 million and 28.6%, respectively, compared to $213.5 million and 27.8%, respectively.
For the year ended December 31, 2024 as compared to the year ended December 31, 2023 : • Revenue increased 6% to $792.3 million from $750.3 million ; • Adjusted Revenue increased 4% to $792.3 million from $760.3 million ; • Net income and net income margin were $16.4 million and 2.1% , respectively, compared to net loss and net loss margin of $8.9 million and 1.2% , respectively; and • Adjusted EBITDA and Adjusted EBITDA Margin were $260.2 million and 32.8% , respectively, compared to $217.4 million and 28.6% , respectively.
For the year ended December 31, 2022, legal settlement expenses represent a negotiated settlement with the Federal Trade Commission. (7) Loss on operating lease assets include, as applicable for the periods presented, losses incurred relating to the abandonment or sublease of certain leased office spaces and disposal of related capitalized costs.
(4) Legal settlement expenses consist of periodic settlement costs for significant and unusual litigation matters. (5) Loss on operating lease assets include losses incurred relating to the abandonment or sublease of certain leased office spaces.
As a result, the remeasurement of the contingent consideration receivable to fair value at December 31, 2022 was no longer a critical accounting estimate. 65 Table of Contents Income Taxes—Valuation of Deferred Tax Assets Deferred tax assets represent amounts available to reduce income taxes payable on taxable income in future years.
The contingency associated with the vitaCare contingent consideration receivable was resolved during 2022 which reduced its fair value to nil. There were no business acquisitions during 2023 or 2024. Income Taxes—Valuation of Deferred Tax Assets Deferred tax assets represent amounts available to reduce income taxes payable on taxable income in future years.
We believe our financial results reflect the significant market demand for our offerings and the value that we provide to the broader healthcare ecosystem; however, our financial results for the year ended December 31, 2023 have been materially impacted by certain restructuring related activities undertaken by us during 2023 and the sustained effects of certain events that occurred during 2022.
We believe our financial results reflect the significant market demand for our offerings and the value that we provide to the broader healthcare ecosystem .
Product development and technology expenses decreased $7.3 million, or 5%, year-over-year, primarily driven by a $14.7 million decrease in payroll and related costs largely due to higher capitalization of certain qualified costs related to the development of internal-use software and lower average headcount.
Product development and technology expenses decreased $12.1 million , or 9% , year-over-year, primarily driven by a $9.4 million decrease in payroll and related costs largely due to higher capitalization of such costs related to the development of internal-use software and a $8.0 million loss recognized in 2023 on the disposal of certain capitalized software that were not yet ready for their intended use, principally as a result of the restructuring of our pharma manufacturer solutions offering.
Interest Income Interest income increased by $22.9 million year-over-year primarily due to higher interest rates earned on cash equivalents held in U.S. treasury securities money market funds. Interest Expense Interest expense increased by $22.5 million, or 66%, year-over-year, primarily due to higher interest rates partially offset by lower average debt balances.
Interest Expense Interest expense decreased by $3.8 million , or 7% , year-over-year, primarily due to lower average debt balances , partially offset by higher interest rates.
For additional information, see Note 17 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
For additional information, see Note 12 in the notes to our audited consolidated financial statement appearing elsewhere in this Annual Report on Form 10-K. We recognized other expense of $4.0 million in 2023 related to an impairment loss on one of our minority equity interest investments.
Depreciation and amortization expenses increased $53.5 million, or 99%, year-over-year, primarily driven by $46.7 million of amortization related to certain intangible assets in connection with the Restructuring Plan, which have been accelerated through December 31, 2023, the date the Restructuring Plan was substantially complete.
Depreciation and amortization Our depreciation and amortization changes are primarily based on changes in our property and equipment, intangible assets, and capitalized software balances and estimates of useful lives. 62 Table of Contents Depreciation and amortization expenses decreased $38.1 million , or 35% , year-over-year, primarily driven by $46.7 million of amortization recognized in 2023 related to certain intangible assets, which had been accelerated in connection with the restructuring of our pharma manufacturer solutions offering.
See Note 17 to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
For additional information, see Note 12 in the notes to our audited consolidated financial statements included elsewhere in this Annual Report on Form 10- K. Interest Income Interest income decreased by $8.9 million , or 28% , year-over-year, primarily due to lower average balance of cash equivalents held in U.S. treasury securities money market funds.
The $47.2 million increase in net cash used in financing activities in 2023 compared to 2022 was primarily related to an increase of $44.8 million for payments related to net share settlement of equity awards, of which $44.5 million related to the Founders Awards, and a decrease of $3.2 million of proceeds from the exercise of stock options.
The impact from these drivers was partially offset by a $35.7 million decrease in employee taxes paid related to net share settlement of equity awards and a $13.1 million increase in proceeds from exercise of stock options.
For developed technology and customer relationships intangible assets, our revenue and margin forecasts include assumptions about future industry conditions, macroeconomic events, our ability to renew contracts in a competitive bidding process including the necessary resources and investments to support these contracts, among other factors.
These methods included various assumptions and estimates including revenue and margin forecasts, our ability to renew contracts in a competitive bidding process and the necessary resources and investments to support these contracts, the seller' s ab ility to continue to order such services given the seller's liquidity position, and discount rates.
Consumer discounts on prescription drugs with partner pharmacies as our customers were recognized as a reduction of prescription transactions revenue.
As a result, all consumer discounts subsequent to this change were and are expected to continue to be recognized as a reduction of prescription transactions revenue.
Pharma manufacturer solutions revenue decreased $14.4 million, or 14%, year-over year, primarily driven by a $10.0 million contract termination payment to a client in connection with the Restructuring Plan, which was recognized as a reduction of revenue, as well as by our increased focus on prioritizing service arrangements with high levels of recurring revenue potential relative to the prior year and moderation in spending across pharma manufacturers.
The prior year included a $10.0 million contract termination payment to a pharma manufacturer solutions client in connection with our restructuring activities, which was recognized as a reduction of revenue. vitaCare Pres cription Services, Inc., ("vitaCare"), a solution 61 Table of Contents impacted by the restructuring, contribut ed ($2.2) milli on of net revenue in 2023 (which is net of the $10.0 million contract termination payment described above) compared to nil in 2024 .
General and administrative expenses decreased $19.3 million, or 13%, year-over-year, primarily driven by a $24.0 million decrease in stock-based compensation expense related to the equity granted to our Co-Founders in 2020 (the "Founders Awards") and costs incurred in 2022 that did not recur in 2023, including a $18.1 million loss from the change in fair value of contingent consideration and a $11.3 million loss related to the impairment of an operating lease asset, partially offset by a $11.4 million pre-tax gain from the sale of certain technology assets of GoodRx Care, LLC, our telehealth platform business.
General and administrative expenses decreased $7.7 million , or 6% , year-over-year, primarily driven by a $16.1 million decrease in stock-based compensation expense related to awards granted to our Co-Founders in 2020 and a $3.0 million decrease in professional fees.
The year-over-year 62 Table of Contents change in depreciation and amortization was further driven by higher amortization related to capitalized software due to higher capitalized costs for platform improvements and the introduction of new products and features. Other Expense Other expense increased by $4.0 million year-over-year, due to an impairment loss on one of our minority equity interest investments.
The impact from this driver was partially offset by higher amortization related to capitalized software due to higher capitalization costs for platform improvements and the introduction of new products and features. Other Expense We recognized other expense of $2.7 million in 2024 related to third-party transaction costs as a result of our debt refinance in July 2024.
The grocer issue and the ongoing impact of COVID-19 may have masked some of these trends in recent periods and may continue to impact these trends in the future. Recent Developments On February 27, 2024, our Board authorized a new $450.0 million stock repurchase program.
PBM-pharmacy issues, including changes in the retail landscape, as well as macroeconomic events such as the COVID-19 pandemic may have masked some of these trends in recent periods and may continue to impact these trends in the future.
Removed
Late in the first quarter of 2022, a grocery chain took actions that impacted acceptance of discounted pricing for a subset of prescription drugs from PBMs, whose pricing we promote on our platform ("grocer issue").
Added
We have seen rapid changes in the U.S. retail pharmacy landscape recently with Rite Aid 's store closures in addition to announcements of store closures and reduction of footprint from various other retail pharmacies, including Walgreens .
Removed
This had a material adverse impact on our prescription transactions revenue and Monthly Active Consumers, which was partially offset by our ability to shift certain prescription transactions to other retailers.
Added
Future store closures and reduction of footprint from retail pharmacies are expected to have an immediate adverse impact on our prescription volume and prescription transactions revenue. However, we believe this impact to be largely transient as we expect prescription volume to migrate to other in-network pharmacies in the near term.
Removed
Although the grocer issue was addressed in August 2022 and our discounted pricing has since been consistently welcomed at the point of sale by the grocery chain, beginning in the second quarter of 2022, it has had and will continue to have a sustained adverse impact on our prescription transactions revenue and Monthly Active Consumers due to consumer response to updated consumer pricing and the timing and extent of returning user levels.
Added
As an extension of the changing retail pharmacy landscape, we have seen and continue to expect heightened renegotiations between pharmacies and PBMs as a result of the pharmacies' increased focus on rationalizing their spending, which in turn has had and may have an impact on our prescription transactions revenue.
Removed
We have not experienced, and are not aware of, PBM-pharmacy issues at any other large volume pharmacies, with the exception of the grocery chain described above, and we believe our pharmacy and PBM relationships remain strong.
Added
Recent Development On January 13, 2025, we acquired substantially all of the assets and assembled workforce of the prescription savings business of Vivid Clear Rx, Inc. for $30.0 million in cash.
Removed
For additional information, please see Part I, Item 1A, “Risk Factors – We rely on a limited number of industry participants.” In addition, but to a lesser extent, the acquisition of vitaCare Prescription Services, Inc.
Added
These excluded items are either non-cash charges or such that we believe do not represent our underlying core operating performance and that their exclusion provides investors with a better understanding of the factors and trends affecting our business . Adjusted EBITDA Margin represents Adjusted EBITDA as a percentage of Adjusted Revenue.
Removed
("vitaCare") in April 2022 also had a negative impact on our net loss, net loss margin, Adjusted EBITDA and Adjusted EBITDA Margin for the year ended December 31, 2023. vitaCare had a higher cost of revenue due to the operational nature of the solutions it supported and had historically generated net losses and negative Adjusted EBITDA.
Added
We consider PBMs, pharmacies, pharma manufacturers and consumers of our subscription and telehealth services, for which we have direct contractual agreements, to be our primary customers .
Removed
On August 7, 2023, our board of directors (our "Board") approved a plan (the "Restructuring Plan") to de-prioritize certain solutions provided under our pharma manufacturer solutions offering, including vitaCare, which was substantially completed at December 31, 2023. The Restructuring Plan is part of our continued strategic focus on scaling and re-balancing our cost structure to drive improved profitability.
Added
Pharma manufacturer solutions revenue increased $22.2 million , or 26% , year-over year, driven by organic growth as we continued to expand our market penetration with pharma manufacturers and other customers.
Removed
Our revenue and net loss for the year ended December 31, 2023 have been impacted by costs incurred due to these restructuring activities, which are expected to result in approximately $18.0 million to $22.0 million of annualized run rate cash savings principally related to future cost of revenues.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

1 edited+0 added−0 removed4 unchanged
Biggest changeA hypothetical 100 basis point increase in interest rates would have increased our interest expense by $6.7 million for the year ended December 31, 2023. Impact of Inflation We do not believe that inflation has had a material effect on our business, results of operations or financial condition.
Biggest changeA hypothetical 100 basis point increase in interest rates would have increased our interest expense by $5.3 million for the year ended December 31, 2024 . Impact of Inflation We do not believe that inflation has had a material effect on our business, results of operations or financial condition.

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