Probably the biggest highlight of Trxade Group Inc (NASDAQ: MEDS) is that it was set up to solve the problems faced by the founders themselves while running pharmacies. Suren Ajjarapu and Prashant Patel owned multiple pharmacies in the Tampa Bay area, and first-hand knowledge of the pain points helped them effectively address the business requirement.
Suren, who is currently the CEO of the firm, identifies three major problems that were faced by independent pharmacies – cash flow squeeze caused by reimbursement delays; negative reimbursements due to price discrepancies; as well as lack of adequate data on supply and demand. Trxade was aimed at solving these pain points by bringing multiple suppliers together to ensure better product availability, besides offering pharmacies the required technology bandwidth.
Initial challenges
According to Suren, convincing clients was an uphill task in the early days. While the company was started in 2010, it took over two years for the firm to acquire its first client.
“Obviously, the big suppliers didn’t want us to be there. The pharmacies were used to doing business in certain ways and didn’t want to change this. So it’s a lot of convincing.”
However, things have become easier since. Suren says it’s now possible to demonstrate the savings for these pharmacies through the Trxade platform, making it much easier to talk to clients. As per the latest earnings release, the company currently has approximately 11,800 registered pharmacies under its network and has established a footprint in all 50 states.
Looking ahead
Suren prefers to call Trxade a healthcare IT services company as it provides a business-to-business platform on one end, while offering business-to-customer technology on the consumer side.
“We believe that for non-emergency services, the patients should never leave the house. They should be able to talk to the doctor and get the drug delivered wherever they want using our network of pharmacies.”
Trxade is currently ramping up data analytics facilities to provide more updated and insightful information to clients. The firm is in the process of building algorithms that inform pharmacies key data including supply situation, price fluctuations etc, the CEO said.
Trxade has been serving pharmacies and drug manufacturers for about eight years, leveraging its web-based platform and mobile application. The company’s technology-based services help independent pharmacies compete effectively with larger drug retailers. Its CEO, Suren Ajjarapu, has previously founded multiple firms including Aemetis, Inc and Sansur Renewable Energy, Inc.
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(Written by Arjun Vijay)
For more insights into Trxade Group, read the latest earnings call transcript here.