Invest in Alto Pharmacy

Alto Pharmacy is addressing the complexities and inefficiencies inherent in the traditional pharmacy model, where patients bear the burden of coordinating various elements of the prescription process. By implementing a digital platform, Alto seeks to streamline the process, automating the backend coordination among doctors, pharmacy benefit managers, and manufacturers, while providing real-time care access and prescription delivery services.

Alto's suite of products, which includes the Alto app, AltoMD, and Wunderbar (PharmacyOS), offers comprehensive solutions for every stakeholder in the value chain. Alto's focus on technological innovation not only enhances prescription order management and delivery, but also offers price transparency, optimizes adherence, and reduces administrative burden, making it an evolving, patient-centric solution in the pharmaceutical space.

Alto’s goal is to simplify the process for patients by developing technology that automates all the backend coordination between physicians, pharmacy benefit managers (PBMs, which act on behalf of insurers), and sometimes manufacturers—from handling prior authorizations to finding coupons that may lower the prescription price to sending the meds out for same-day delivery. After seeing their doctor, all patients need to do is interact with the Alto app (or via text) and receive the prescription at their front door.

Alto solves this opaque and inefficient system by providing prescription price visibility/optimization, real-time care access by phone, text, or app, flexible and fast courier delivery, eliminating 20+ hours per week of back-office time, and core infrastructure to track prescription adherence and patient satisfaction with prescription service.

The Alto app offers a world-class eCommerce-like experience for prescription orders and delivery, fast and friendly customer service, and medication management that increases patient adherence and saves patients money. The Alto app provides: (1) Auto-refills and reminders, (2) Courier delivery, and (3) Price transparency/optimization.

Alto automatically coordinates refills and delivery for users. Users can also use the Alto app to set reminders to take their medications.

Alto hand-delivers users’ medications at the time and location that works best for them. Users also get delivery updates via text, or they can track their courier in real time within the Alto app. Alto will leave users’ medications in a designated safe place for secure, contactless delivery.

Alto’s team searches through their database and locates all coupons, copay cards and manufacturer savings programs for a user’s prescription, and even identifies alternative options that are covered by their insurance when needed.

AltoMD is a web and mobile app for healthcare providers that reduces their pharmacy workload and replaces the status quo black box with real-time visibility to enable better, faster patient care. AltoMD offers providers workflow optimization, benefits coordination, lower administrative burden, increased transparency, real-time communication, and increased patient fill rate and adherence.

Wunderbar is a patient-centric prescription processing, fulfillment, and customer service app that enables Alto’s operations team to support patients and providers.

Wunderbar is the internal technology pharmacists and care teams use to manage their workflows. It also controls the robots that fill every prescription order. Wunderbar was built and continues to be improved in-house, giving Alto a strong foundation to grow and scale.

Alto continues to build on its technology and launched Alto Connect, a mobile app for doctor offices. Alto claims to have been the first pharmacy in the U.S. to introduce a prescriber-focused pharmacy communication platform with the original desktop-based AltoMD product in 2016. Alto Connect is an evolved version of that software. The company also launched Alto Essentials to enable consumers to buy over-the-counter health and wellness products along with their medication delivery orders.

According to CEO Alicia Davis in an interview with The Information, “We have most of our business in the specialty areas, so you think about Fertility, Endocrinology, Cardiac, Pulmonary, that type of more critical care area. And then we also have core medicines that we also focus on.”

Alto’s provider-driven go-to-market strategy drives patient engagement, enabling wallet and margin expansion.

According to Fortune, “Though it’s not alone in its mission to build a business around better serving pharmacy patients, Alto stands apart in its trajectory—the company already hit $1 billion in revenue this year—and in the bold-faced names it has drawn to its cause.”

According to Fierce Healthcare, the company is now in 13 markets and has doubled year-over-year since the company started eight years ago. Alto is focused on continuing its upward growth trajectory, aiming for 100% year-over-year top-line growth and improving its unit economics as it automates pharmacy backend operations. The company is planning to expand into new markets in 2023.

Alto, which is growing fast but not yet profitable, is also still working out the finer points of its business model. It makes money, like other pharmacies, off the margins in selling prescription drugs. It’s also finding places where it can trim costs from its evolving business. In June 2022, the company laid off 9% of its workforce, “mainly in roles focused on back-office function where we have learned how to be a leaner, more efficient team,” according to the company. Alto says it continues to hire aggressively to fill front-line roles. "We've been driving massive progress on our unit economics as we've gotten more scale. Those two factors simply multiply to pipe down to the bottom line and get us closer and closer to full company profitability," said Jamie Karraker, saying Alto is on track to get into the black (profitable) in the next "few years."

Alto also wants to expand its business lines and services on top of its core pharmacy business to connect patients with digital therapeutics.

"There are all these new waves of therapy that are coming onto the market that are showing huge clinical efficacy and potential but they're all struggling with distribution. These digital therapeutic companies are struggling to find the patients that need them the most and get to them and it's costing them tons of money to do distribution. We've already built that distribution channel for physical medication. That's what a pharmacy is. We have this really powerful platform and distribution platform that over time we can leverage to distribute all types of therapy, not just physical medications. That's an important part of our vision as well," said Jamie Karraker.

Alto Pharmacy can leverage its data on hundreds of thousands of patients to help connect digital therapeutics companies with the right doctors and patients who could benefit most from those therapies. As an example, a patient living with diabetes could benefit from using a digital health platform that provides nutritional coaching and meal plans. "We can help connect all the dots and just be a win-win-win for all the players involved," said Co-Founder Jamie Karraker.

"We've created value that, quite honestly, we haven't started monetizing yet," CEO Alicia Davis said, citing the value of Alto's software to streamline the experience for both patients and doctors without needing phones or fax machines.

According to TechCrunch’s Pitchdeck Teardown, Alto sees promising expansion opportunities, potentially enlarging its total addressable market to $800 billion. These include: (1) Prescriptions: $450 billion, (2) Subscription: $13 billio, (3) Over-the-Counter: $65 billion, (4) Telemedicine: $250 billion, (5) Population Health: $24 billion.

In 2022, Alto reportedly considered a merger with a blank-check firm backed by billionaire Alec Gores, according to Bloomberg, but the deal was said to have fallen through in later months.

According to Axios, after the deal to acquire patients from digital pharmacy NowRx, which was going out of business, CEO Alicia Davis said Alto is still hunting for more acquisitions. "I think the organic growth is really important, but I also think that there's opportunities for acquisition to really grow and leverage the platform we've built," said CEO Alicia Davis.

In August 2024, Alto Pharmacy introduced an expansion of its services, offering patients faster and more convenient delivery options. The new Express Delivery service enables courier delivery within just one hour of placing an order. Additionally, Alto has extended its home delivery service, now reaching fertility patients across all 50 states.

In October 2024, Alto Pharmacy introduced Alto Technologies, a new suite of enterprise solutions aimed at revolutionizing pharmacy technology by integrating pharmacist expertise with automation and AI. Alto Technologies offers configurable solutions, including Alto Complete, a unique platform that combines hub and dispensing functions, along with individual hub and dispensing options. By automating traditionally manual processes, these solutions enhance the patient experience, improve medication access and adherence, and set new benchmarks for convenience, cost efficiency, and quality of care.

In November 2024, Bloomberg reported that the company raised at least $40 million from investors in the form of a convertible note, from existing investors including Softbank.