Item 1A. Risk Factors .
Our business involves significant risks, some of which are described below. You should carefully consider the risks and
uncertainties described below, together with all of the other information in this Annual Report on Form 10-K. The risks and
uncertainties described below are not the only ones we face. Additional risk and uncertainties that we are unaware of or that
we deem immaterial may also become important factors that adversely affect our business. The realization of any of these
risks and uncertainties could have a material adverse effect on our reputation, business, financial condition, results of
operations, growth and future prospects as well as our ability to accomplish our strategic objectives. 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 Historical 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 limited operating history and evolving business make it difficult to evaluate and assess the success of our business
to date, our future prospects and the risks and challenges that we may encounter. 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.
If we fail to address the risks and difficulties that we face, including those associated with the challenges listed above
and those described elsewhere in this Part I, Item 1A, “Risk Factors,” our business, financial condition, and results of
operations could be adversely affected. Further, because we have limited historical financial data and our business
continues to evolve and expand within the U.S. healthcare industry, any predictions about our future revenue and expenses
may not be as accurate as they would be if we had a longer operating history, operated a more predictable business, or
operated in a less regulated industry. We have encountered in the past, and will encounter in the future, risks and
uncertainties frequently experienced by growing companies with limited operating histories and evolving businesses that
operate in highly regulated and competitive industries. 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.
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Our historical growth rates may not be sustainable or indicative of future growth.
Our historical rate of growth may not be sustainable or indicative of our future rate of growth. We estimate that
prescription transactions revenue will be impacted by recent and future retail pharmacy store closures, and that subscription
revenue may decrease, while pharma direct revenue may continue to grow as a percentage of total revenue in the near to
medium term. We believe that our ability to improve or maintain revenue and margins and sustain profitability, will depend
upon, among other factors, our ability to address the challenges, risks and difficulties described elsewhere in this Part I, Item
1A, “Risk Factors” and the extent to which our various offerings grow, organically and through acquisitions, and contribute to
our results of operations. We cannot provide assurance that we will be able to successfully manage any such challenges or
risks to our future growth. In addition, our base of consumers may not continue to grow or may decline due to a variety of
risks, including increased competition, changes in the dynamics among industry participants and us, changes in the
regulatory landscape and the maturation of our business. Any of these factors could cause our revenue growth to decline
and may adversely affect our margins and profitability. Failure to grow our revenue or improve margins would have a
material adverse effect on our business, financial condition and results of operations. You should not rely on our historical
rate of revenue growth for any prior quarterly or annual period as an indication of our future performance.
Our results of operations vary and may fluctuate significantly from period-to-period.
Our quarterly and annual results of operations have historically varied from period-to-period and we expect that our
results of operations will continue to do so for a variety of reasons, many of which are outside of our control and are difficult
to predict. We have presented many of the factors that may cause our results of operations to fluctuate in this Part I, Item
1A, “Risk Factors,” including the extent to which our various offerings grow and contribute to our results of operations. In
addition, we typically experience stronger consumer demand during the first and fourth quarters of each year, which coincide
with generally higher consumer healthcare spending, doctor office visits, annual benefit enrollment season, and seasonal
cold and flu trends. We may experience stronger demand for our pharma direct offering during the fourth quarter of each
year, which coincides with pharma manufacturers' annual budgetary spending patterns. Additionally, a majority of our
pharma direct revenue in any given quarter is derived from contracts entered into with our customers during previous
quarters. Consequently, a decline in new or renewed contracts in any one quarter may not be fully reflected in our revenue
for that quarter. PBM-pharmacy issues such as actions taken by a grocery chain in 2022 that impacted acceptance of
discounted pricing for a subset of prescription drugs from PBMs and whose pricing we promote on our platform (the "grocer
issue"), including changes in the retail landscape, as well as macroeconomic events may have masked some of these
trends in recent periods and may continue to impact these trends in the future. For example, we expect that the closure of
Rite Aid stores, which is reflective of the changing retail pharmacy landscape, will adversely impact our revenues in the year
ending December 31, 2026. 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 continue to have an adverse impact on our prescription
transactions revenue. The cumulative effects of such factors could result in large fluctuations and unpredictability in our
quarterly and annual results of operations. As a result, comparing our results of operations on a period-to-period basis may
not be meaningful and investors should not rely on our past results as an indication of our future performance.
This variability and unpredictability could also result in our failing to meet the expectations of industry or financial
analysts or investors for any period. If our revenue or results of operations fall below the expectations of analysts or
investors or below any guidance we may provide, or if the guidance we provide is below the expectations of analysts or
investors, the price of our Class A common stock could decline substantially. Such a stock price decline could occur even
when we have met any previously publicly stated guidance we may provide.
We may be unable to manage our future growth effectively, which could make it difficult to execute our business
strategy.
In the past, we experienced rapid growth in our business operations and the number of consumers that use our
offerings, and we may experience such growth in the future. This historical growth placed, and may in the future place,
significant demands on our management and our operational and financial infrastructure. Our ability to manage our future
growth effectively and to integrate new employees, technologies and acquisitions into our existing business may require us
to expand our operational and financial infrastructure and to continue to retain, attract, train, motivate and manage
employees. Management of growth is particularly difficult when employees work from home as a result of our hybrid/remote
workplace. Growth could strain our ability to develop and improve our operational, financial and management controls,
enhance our reporting systems and procedures, recruit, train and retain highly skilled personnel, and maintain consumer
satisfaction. Additionally, if we do not effectively manage the growth of our business and operations, the quality of our
platform and offerings could suffer, which could negatively affect our reputation and brand, business, financial condition, and
results of operations.
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Risks Related to Our Business
We may be unsuccessful in achieving broad market education and changing consumer purchasing habits.
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. We believe the vast majority of consumers make purchasing
decisions for healthcare products and services on the basis of traditional factors, such as insurance coverage, availability at
nearby pharmacies, and availability of nearby medical testing. This traditional decision-making process does not always
account for restrictive and complex insurance plans, high deductibles, expensive co-pays, and other factors, such as
discounts or savings available at alternative pharmacies or practices. 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. We focus our marketing and education efforts on consumers, but
also aim to educate and inform healthcare providers, pharmacists and other participants that interact with consumers,
including at the point of purchase. However, we cannot assure you that we will be successful in changing consumer
purchasing habits or that we will achieve broad market education or awareness among consumers. Even if we are able to
raise awareness among consumers, they may be slow in changing their habits and may be hesitant to use our platform for a
variety of reasons, including:
• lack of experience with our Company and platform, and concerns that we are relatively new to the industry;
• perceived health, safety or quality risks associated with the use of a new platform and applications to shop for
discounted prices for prescription medications;
• lack of awareness that there is a disparity of pricing for prescription medicines and other medical products and
services;
• perception that our platform does not provide adequate discounted prices or only offers savings for a limited
selection of prescription medications;
• perception that discounted prices offered through our platform are less competitive than insurance coverage;
• perception regarding acceptance rates of pharmacies for our GoodRx codes available through our platform,
such as what occurred in connection with the grocer issue;
• traditional or existing relationships with pharmacies, pharmacists, or other providers that sell healthcare
products and services;
• concerns about the privacy and security of the data that consumers share with or through our platform, such as
in relation to our FTC Order to resolve all claims and allegations arising out of or relating to the FTC's
investigation into our privacy and security practices;
• competition and negative selling efforts from competitors, including competing platforms and price matching
programs; and
• perception regarding the time and complexity of using our platform or using and applying our GoodRx codes
available through our platform at the point of purchase.
If we fail to achieve broad market education of our platform and/or the options for purchasing healthcare products and
services, or if we are unsuccessful in changing consumer purchasing habits, our business, financial condition and results of
operations would be adversely affected.
We may be unable to continue to attract, acquire, and retain consumers, or may fail to do so in a cost-effective
manner.
Our success depends in part on our ability to cost-effectively attract and acquire new consumers, retain our existing
consumers, and encourage our consumers to continue to utilize our platform when making purchasing decisions for
prescription medications and other healthcare products and services. To expand our base of consumers, we must appeal to
consumers who have historically used traditional outlets for their healthcare products and services, and who may be
unaware of the possibility or benefits of using discounted prices to purchase healthcare products and services outside of
insurance programs. We have made significant investments related to consumer acquisition and expect to continue to spend
significant amounts to acquire additional consumers. We cannot assure you that this spending will be effective or that
revenue from new consumers that we acquire will ultimately exceed the cost of acquiring those consumers. Alternatively, we
have and may continue to focus on the efficiency of our spending on customer acquisition related strategies, which may
impact our ability to acquire or retain consumers. If we fail to deliver reliable and significant discounted prices for prescription
medications, we may be unable to acquire or retain consumers. If we are unable to acquire or retain consumers who use our
platform in volumes and with recurrence sufficient to grow our business, we may be unable to maintain the scale necessary
for operational efficiency and to drive beneficial and self-reinforcing network effects across the broader healthcare
ecosystem, including pharmacies, PBMs, and pharma manufacturers. Consequently, we may not be able to present the
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same quality or range of solutions on our platform or otherwise, which may adversely impact consumer interest in our
platform, in which case our business, financial condition, and results of operations would be adversely affected.
We believe that our paid and non-paid marketing initiatives have been critical in promoting consumer awareness of our
platform and offerings, which in turn has driven new consumer growth and increased the extent to which existing consumers
have used our platform. 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. If we are unable to cost-effectively market to consumers, or if we
elect to reduce our spending to drive traffic to our apps and websites, our ability to acquire new consumers and our financial
condition would be materially and adversely affected. 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. Search engines
frequently modify their search algorithms and these changes can cause our websites to receive less favorable placements,
which could reduce the number of consumers who visit our websites. The costs associated with advertising through search
engines can also vary significantly from period to period, and have generally increased over time. We may be unable to
modify our strategies in response to any future search algorithm changes made by the search engines, which could require
a change in the strategy we use to generate consumer traffic to our websites. In addition, our websites must comply with
search engine guidelines and policies, which are complex and may change at any time. 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. Although consumer traffic to our apps is not reliant on search results, growth in mobile device usage may not
decrease our overall reliance on search results if consumers use our mobile websites rather than our apps or use search to
initially find our apps. In fact, growth in mobile device usage may exacerbate the risks associated with how and where our
websites are displayed in search results because mobile device screens are smaller than desktop computer screens and
therefore display fewer search results.
In addition, we actively encourage new and existing consumers to use our apps to access our platform. We believe that
our apps help to facilitate increased consumer retention and that consumers that access our platform through our apps are
more likely to utilize GoodRx codes at the final point of purchase. While we have invested and will continue to invest in the
development of our apps to improve consumer utilization, there can be no assurance that our efforts to drive adoption and
use of our apps will be effective.
To remain competitive and encourage the use of our platform, we have in the past offered and may continue to offer
incentives to certain consumers that further reduce discounted prices offered on our platform. We cannot assure that offering
such incentives will be successful in attracting new and recurring consumers or that we will be able to maintain competitive
discounted prices in the future to retain such consumers. If we are unable to successfully manage these incentives, our
financial performance may be adversely impacted.
Our consumer education, acquisition, and retention initiatives can be expensive and may be ineffective in driving
consumer education or interest in our platform. Further, if new or existing consumers do not perceive that the discounted
prices presented through our platform are reliable or meaningful, or if we fail to offer new and relevant offerings and
application features, we may not be able to attract or retain consumers or increase the extent to which they use our platform
and applications for other or future purchases. If we fail to continue to grow our base of consumers, retain existing
consumers or increase consumer engagement, our business, financial condition, and results of operations will be adversely
affected.
We rely significantly on our prescription transactions offering and may not be successful in expanding or
maintaining our offerings within our markets, particularly the U.S. prescriptions market, or to other segments of the
healthcare industry.
To date, the majority of our revenue has been derived from our prescription transactions offering. When a consumer
uses a GoodRx code to fill a prescription and saves money compared to the list price at that pharmacy, we receive fees from
our partners, including PBMs, pharma manufacturers and pharmacies, as applicable. Revenue from our prescription
transactions offering represented 68% , 73% , and 73% of our revenue for the years ended December 31, 2025 , 2024 , and
2023 , respectively. Substantially all of this revenue was generated from consumer transactions at brick-and-mortar
pharmacies. 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 revenue, which have
had and may continue to have an adverse effect on our business, financial condition, and results of operations. Because we
derive a majority of our revenue from our prescription transactions offering, any material decline in the use of such offering
or in the fees we receive from our partners in connection with such offering would have a pronounced impact on our future
revenue and results of operations, particularly if we are unable to expand our offerings overall. For example, in the first half
of 2025, we observed that one of our PBM partners began offering other third-party discount cards on their platform. This
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increased the direct competition we faced at the point-of-sale and had an adverse impact on our prescription transactions
revenue.
We seek to expand our offerings within the prescriptions market and the pharma direct market in the United States, and
we are actively investing in these growth areas. We also continue to focus on the optimization of our existing partnerships
and have entered into, and may in the future enter into, new or revised agreements with industry participants, and have also
terminated, and may in the future terminate, existing arrangements with industry participants. However, expanding our
offerings, entering into new markets and entering into new partnerships requires substantial additional resources, and our
ability to succeed is not certain. During and following periods of active investment in such offerings, markets, relationships
and partnerships, we may experience a decrease in profitability or margins, particularly if the area of investment generates
lower margins than our other offerings. 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. Any such expansion
and/or optimization would be subject to additional uncertainties and would likely be subject to additional laws and
regulations. As a result, we may not be successful in future efforts to expand into or achieve profitability from new markets,
new business models or strategies, new partnerships or new offering types, and our ability to generate revenue from our
current offerings and continue our existing business may be negatively affected. 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.
Our platform aggregates and analyzes pricing data from a number of different sources. The discounted prices that we
present through our platform are based in large part upon pricing structures negotiated by industry participants. Although
some of our contracts with certain of our partners contain provisions related to discount pricing, we do not control the overall
pricing strategies of pharma manufacturers, wholesalers, PBMs, and pharmacies, each of which is motivated by
independent considerations and drivers that are outside our control and has the ability to set or significantly impact market
prices for different prescription medications. While we have contractual and non-contractual relationships with certain
industry participants, such as pharmacies, PBMs, and pharma manufacturers, these and other industry participants often
negotiate complex and multi-party pricing structures, and we have no control over these participants and the policies and
strategies that they implement in negotiating these multi-party pricing structures . For example, as an extension of the
changing retail pharmacy landscape in recent years, we have seen and continue to expect heightened renegotiations
between pharmacies and PBMs, including changes in retailer reimbursement models, as a result of the pharmacies'
increased focus on rationalizing their spending.
Pharma manufacturers generally direct medication pricing by setting medication list prices and offering rebates and
discounts for their medications. List prices are impacted by, among other things, market considerations such as the number
of competitor medications and availability of alternative treatment options. Wholesalers can impact medication pricing by
purchasing medications in bulk from pharma manufacturers and then reselling such medications to pharmacies. PBMs
generally impact medication pricing through their bargaining power, negotiated rebates with pharma manufacturers, and
contracts with different pharmacy providers and health insurance companies. PBMs work with pharmacies to determine the
negotiated rate that will be paid at the pharmacy by consumers. We also work with pharmacies with which we have
contractual arrangements to offer discount prices to consumers. Medication pricing is also impacted by health insurance
companies and the extent to which a health insurance plan provides for, among other things, covered medications, preferred
tiers for different medications, and high or low deductibles. To the extent future regulation impacts the prices that PBMs can
charge, that could adversely impact our business. A majority of the utilization of our platform relates to generic medications.
Our ability to present discounted prices through our platform, the value of any such discounts and our ability to generate
revenue are directly affected by the pricing structures in place amongst these industry participants, and changes in
medication pricing and in the general pricing structures that are in place could have an adverse effect on our business,
financial condition, and results of operations. For example, changes in the negotiated rates of the PBMs on our platform at
pharmacies could negatively impact the prices that we present through our platform, and changes in insurance plan
coverage for specific medications could reduce demand for and/or our ability to offer competitive discounts for certain
medications, any of which could have an adverse effect on our ability to generate revenue and business. In addition,
changes in the fee and pricing structures among industry participants, whether due to regulatory requirements, executive
actions, tariffs, competitive pressures, or otherwise, that reduce or adversely impact fees generated by PBMs or directly by
us through partner pharmacies would have an adverse effect on our ability to generate revenue and 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. For example, integration of PBMs and pharmacy providers could result in pricing structures
whereby such entities would have greater pricing power and flexibility or industry players could implement direct to
consumer initiatives that could significantly alter existing pricing structures, either of which would have an adverse impact on
our ability to present competitive and low prices to consumers and, as a result, the value of our platform for consumers and
our results of operations.
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We generally do not control the categories and types of prescriptions for which we can offer savings or discounted
prices.
The categories and brands of medications for which we can present discounted prices are largely determined by PBMs,
pharmacies and pharma manufacturers. PBMs work with insurance companies, employers, and other organizations and
enter into contracts with pharmacies to determine negotiated rates. They also negotiate rebates with pharma manufacturers.
The terms that various PBMs negotiate with each pharmacy are generally different and result in different negotiated rates
available via each PBM’s network, all of which is outside our control. Different PBMs prioritize and allocate discounts across
different medications, and continuously update these allocations in accordance with their internal strategies and
expectations. 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. We also have
agreements with partner pharmacies to offer discount prices to consumers and such discount prices are subject to
negotiated terms and conditions. In general, industry participants are less likely to allocate or provide discounts or rebates
on brand medications that are covered by patents. 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.
Changes in the categories and types of medications for which we can present pricing through our platform could have
an adverse effect on our business, financial condition and results of operations. In addition, demand for our offerings and the
use and utility of our platform is impacted by the value of the discounts that we are able to present and the extent to which
there is inconsistency in the price of a particular prescription across the market. If pharmacies, PBMs or others do not
allocate or otherwise facilitate adequate discounts for these medications, or if there is significant price similarity or
competition across PBMs and pharmacies, the perceived value of our platform and the demand for our offerings would
decrease and there would be a significant impact on our business, financial condition and results of operations.
We rely on a limited number of industry participants .
There is currently significant concentration in the U.S. healthcare industry, and in particular there are a limited number
of PBMs, including pharmacies’ in-house PBMs, and a limited number of national pharmacy chains. If we are unable to
retain favorable contractual arrangements and relationships with our PBM partners and partner pharmacies, including any
successor PBMs or pharmacies should there be further consolidation of PBMs or pharmacies, we may lose them as
customers and partners, as applicable, or the negotiated rates provided by such PBMs or directly through such partner
pharmacies may become less competitive, which could have an adverse impact on the discounted prices we present
through our platform. Additionally, there is a limited number of counterparties and vendors who provide us with prescription
transaction processing services that support our business. If our current counterparties and vendors were to stop providing
services on acceptable terms, the resulting disruption could also have an adverse effect on our business.
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. We
work with dozens of PBMs that maintain cash networks and prices, and the number of PBMs we work with has 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. Revenue from each PBM fluctuates from
period to period as the discounts and prices available through our platform change, and different PBMs experience
increases and decreases in the volume of transactions processed through their respective networks. Further, some of our
contracts contain exclusivity provisions, which could limit our ability to negotiate pricing terms as market prices fluctuate. Our
three largest PBM customers accounted for 22% of our revenue in 2025 , 27% of our revenue in 2024 , and 32% of our
revenue in 2023 . In 2025 and 2024 , no single PBM customer accounted for more than 10% of our revenue . In 2023 , one
PBM customer accounted for more than 10% of our revenue. The loss of any of these large PBM customers may negatively
impact the breadth of the pricing that we are able to offer consumers.
Most of our PBM contracts provide for monthly payments from PBMs. Our PBM contracts generally can be divided into
two categories: PBM contracts featuring a percentage of fee arrangement, where fees are a percentage of the fees that
PBMs charge to pharmacies, and PBM contracts featuring a fixed fee per transaction arrangement. Our percentage of fee
contracts often also include a minimum fixed fee per transaction. The majority of our PBM contracts are percentage of fee
contracts, and a minority of our contracts provide for fixed fee per transaction arrangements. Our PBM contracts generally
have a tiered fee structure based on volume generated in the applicable payment period. Our PBM contracts do not contain
minimum volume requirements, and thus do not provide for any assurance as to minimum payments to us. Our PBM
contracts generally renew automatically. In addition, our PBM contracts generally provide for continuing payments to us after
such contracts are terminated. 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.
In addition, our PBM contracts typically include provisions that prevent PBMs from circumventing our platform,
redirecting volumes outside of our platform, and other protective measures. For example, our PBM contracts contain
provisions that limit PBM use of our intellectual property related to our brand and platform and require PBMs to maintain the
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confidentiality of our data. While we have consistently renewed and extended the term of our contracts with PBMs over time,
there can be no assurance that PBMs will enter into future contracts or renew existing contracts with us, or that any future
contracts they enter into will be on equally favorable terms. Changes that limit or otherwise negatively impact our ability to
receive fees from these partners would have an adverse effect on our business, financial condition, and results of
operations. Consolidation of PBMs or the loss of a PBM could negatively impact the discounts and prices that we present
through our platform and may result in less competitive discounts and prices on our platform.
Our consumers use GoodRx codes at the point of purchase at nearby pharmacies . 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.
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. We have
entered, and may in the future enter, into direct contractual arrangements with pharmacies, which we refer to as our partner
pharmacies, to offer discount prices to consumers at such pharmacies. Further, if counterparties and vendors we use to
process prescriptions were to stop providing services to us on acceptable terms, we may be unable to procure alternative
services from other counterparties or vendors in a timely and efficient manner and on similar acceptable terms. Accordingly,
we may incur significant costs to resolve any such disruptions in services, which could have a material adverse effect on our
business.
In recent years, many pharmacy chains have announced plans to close thousands of retail pharmacy locations and
thousands of retail pharmacy locations have closed . We derive a significant portion of our revenue from transactions
processed at pharmacy chains. If our consumers are unable to access retail pharmacies, they may seek other options to fill
their prescriptions, such as through mail delivery services, or choose not to fill or refill existing prescriptions, which may
adversely impact our revenues. 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 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.
The impact of the changing retail pharmacy landscape is currently unknown, but may adversely affect our business,
financial condition, and results of operations.
If one or more pharmacy chains terminates its cash network contracts with PBMs that we work with, enters into cash
network contracts with PBMs that we work with at less competitive rates or, to the extent a pharmacy chain has entered into
a direct contractual arrangement with us, terminates such contractual arrangement, our business may be negatively
affected. For example, a grocery chain took actions in 2022 that impacted acceptance of discounted pricing for a subset of
prescription drugs from PBMs and whose pricing we promote on our platform. This had a material adverse impact on our
results of operations . Such actions could be exacerbated by further consolidation of PBMs or pharmacy chains. If such
changes, individually or in the aggregate, are material, they would have an adverse effect on our business, results of
operations and financial condition. If there is a decline in revenue generated from any of the PBMs or pharmacies we
contract with, as a result of consolidation of PBMs or pharmacy chains, pricing competition among industry participants or
otherwise, if we are unable to maintain or grow our relationships with PBMs and pharmacies or if we lose one or more of the
PBMs or partner pharmacies we contract with and cannot replace such PBM or partner pharmacy in a timely manner or at
all, there would be an adverse effect on our business, financial condition, and results of operations.
We operate in a very competitive industry and we may fail to effectively differentiate our offerings and services
from those of our competitors, which could impair our ability to attract and acquire new consumers and retain
existing consumers.
The U.S. prescriptions market, pharma direct market and telehealth market are highly competitive and subject to
ongoing innovation and development. Our ability to remain competitive is dependent upon our ability to appeal to consumers
and attract and acquire new consumers to our platform, including through our apps. Our ability to remain competitive is also
dependent upon our ability to retain existing consumers and encourage them to continue to use our platform as a tool for
purchasing healthcare products and services. We operate in a highly competitive environment and in an industry that is
subject to significant market pressures brought about by consumer demands, a limited number of major PBMs and
pharmacy operators, fluctuations in medication pricing, legislative and regulatory activity, significant changes in demand and
interest in telehealth, and other market factors.
We compete with companies that provide savings on prescriptions, as well as companies that offer advertising and
market access for pharma manufacturers . Within the prescriptions discounts and price comparison market, our competition
is fragmented and consists of competitors that are larger and smaller than us in scale, including large e-commerce
companies. There can be no assurance that competitors will not develop and market similar offerings to ours, or that
industry participants, such as integrated PBMs and pharmacy providers, will not seek to leverage our platform to drive
consumer demand and traffic to their networks and eventually away from, or outside of, our platform. We may face
increased competition from those that attempt to replicate our business model or marketing tactics, such as discount
websites, e-commerce websites, apps, cash back and loyalty programs, and new comparison shopping sites from various
industry participants, any of which could impact our ability to attract and retain consumers. Our pharma direct offering
competes for advertising and market access budget allocation against traditional direct to consumer and other platforms on
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which pharmaceutical manufacturers can reach consumers, such as through physicians, health-related apps and websites,
television advertisements, and services supporting patient access. We also face competition in the telehealth market from a
range of companies, including providers of telehealth services that are larger than us, and which usually provide telehealth
services on behalf of employers and insurance plans. A competitor’s offerings, reputation, and marketing strategies can have
a substantial impact on its ability to attract and retain consumers, and we may face competition from existing or new market
entrants with greater resources and better offerings, pricing, reputations, and market strategies, which would have a
negative impact on our business. Any such competitor may be better able to respond quickly to new technologies, develop
deeper relationships with consumers and industry participants, including pharmacies, PBMs, and telehealth providers, or
offer more competitive discounts or pricing. 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. For example, our contracts include provisions that, among others, restrict the ability of PBMs and our partner
pharmacies to compete with us and solicit our consumers. We aim to differentiate our business through scale and by
innovating and delivering offerings and services that demonstrate value to our new and existing consumers, particularly in
response to frequent changes in medication pricing and the cost of medical care. Our failure to innovate and deliver
offerings and services that demonstrate value, or to market such offerings and services effectively, may affect our ability to
acquire or retain consumers, which could have a material adverse effect on our business, results of operations and financial
condition.
We may also face competition from companies that we do not yet know about. 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.
Our estimated addressable market is subject to inherent challenges and uncertainties. If we overestimate the size
of our addressable market or the various markets in which we operate, our future growth opportunities may be
limited.
Our TAM is based on internal estimates and third-party estimates regarding the size of each of the U.S. prescriptions
market and pharma direct market, and is subject to significant uncertainty and is based on assumptions that may not prove
to be accurate. 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 expenditur es 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. These estimates are based on third-party reports and are subject to significant assumptions and
estimates. Additionally, we calculated the TAM for our pharma direct opportunity based on internal data regarding the
amount of advertising and marketing spending by U.S. pharma manufacturers relating to prescription drugs in 2022. These
estimates, as well as the estimates and forecasts elsewhere in this Annual Report on Form 10-K relating to the size and
expected growth of the markets in which we operate, may change or prove to be inaccurate. While we believe the
information on which we base our TAM is generally reliable, such information is inherently imprecise. In addition, our
expectations, assumptions and estimates of future opportunities are necessarily subject to a high degree of uncertainty and
risk due to a variety of factors, including those described herein. If third-party or internally generated data prove to be
inaccurate or we make errors in our assumptions based on that data, our future growth opportunities may be affected.
Additionally, our TAM for our prescription transactions offering includes medications for which we are currently not able to
offer savings on the prices paid by non-insured and insured consumers and for which we may not be able to provide savings
on in the future. If our TAM, or the size of any of the various markets in which we operate, proves to be inaccurate, our future
growth opportunities may be limited and there could be a material adverse effect on our prospects, business, financial
condition and results of operations.
We calculate certain operational metrics using internal systems and tools and do not independently verify such
metrics. Certain metrics are subject to inherent challenges in measurement, and real or perceived inaccuracies in
such metrics may harm our reputation and negatively affect our business.
We publicly disclose, including in our SEC filings, certain operational metrics, such as Monthly Active Consumers,
Monthly Visitors, subscribers, subscription plans, savings, and other metrics. We calculate these metrics using internal
systems and tools that are not independently verified by any third party. These metrics may differ from estimates or similar
metrics published by third parties or other companies due to differences in sources, methodologies or the assumptions on
which we rely. Our internal systems and tools have a number of limitations, and our methodologies for tracking these metrics
have evolved and may continue to change over time, which could result in unexpected changes to our metrics, including the
metrics we publicly disclose on an ongoing basis. If the internal systems and tools we use to track these metrics undercount
or overcount performance or contain algorithmic or other technical errors, the data we present may not be accurate. While
these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of
measurement, there are inherent challenges in measuring savings, the use of our platform and offerings, and other metrics.
For example, we believe that there are consumers who access our offerings through multiple accounts or channels, and that
there are groups of consumers, such as families, who access our offerings through single accounts or channels, both of
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which impact our number of Monthly Visitors, as each channel is counted independently. In addition, limitations or errors with
respect to how we measure data or with respect to the data that we measure may affect our understanding of certain details
of our business, which would affect our long-term strategies. If our operating metrics or our estimates are not accurate
representations of our business, or if investors do not perceive our operating metrics to be accurate, or if we discover
material inaccuracies with respect to these figures, our reputation may be significantly harmed, and our operating and
financial results could be adversely affected.
Our telehealth related products and services are dependent on our ability to maintain our relationship with our
telehealth provider network, including our affiliated professional entities, and the ability of such entities to recruit
qualified telehealth providers.
The success of our telehealth related products and services depend in part on our continued ability to maintain our
relationship with our telehealth provider network, including our affiliated physician-owned professional entities that we
contract with to deliver our telehealth offering, and the ability of our affili ated professional entities to recruit qualified
telehealth providers. There is significant competition in the telehealth market for qualified telehealth providers, and if our
affiliated professional entities are unable to recruit or retain an adequate number of physicians and other healthcare
professionals, whether directly or indirectly through staffing providers, such as Wheel, which provides a network of
healthcare providers to our affiliated professional entities, it could negatively impact our telehealth offering. Moreover, if one
or more of our relationships with these affiliated professional entities were to end, it could have a material adverse effect on
our business, financial condition and results of operations and/or cause us to cease our telehealth related products and
services.
Negative media coverage could adversely affect our business.
We receive a high degree of media coverage in the United States. 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. Such negative publicity also could have an adverse effect on our ability to attract and retain
consumers, partners, or employees, and result in decreased revenue, which would materially adversely affect our business,
financial condition, and results of operations.
We may be unable to successfully respond to changes in the market for prescription pricing, and may fail to
maintain and expand the use of GoodRx codes through our apps and websites.
In recent years, we believe that consumer preferences and access to prescription medication discounts has increasingly
shifted from traditional offline or analog channels, such as newspapers and by direct mail, to digital or electronic channels,
such as apps, websites, and by email. 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. While we
actively promote the use of our apps and websites, if the demand for digital channels does not continue to grow as we
expect, or if we fail to successfully address this demand through our platform, our business could be harmed. Consumer
access and preferences for purchasing medications may evolve in ways which may be difficult to predict. Further, if PBMs or
pharmacy operators elect to directly distribute pricing information through their own digital channels, or if new or existing
competitors are faster or better at addressing consumer demand and preferences for digital channels, or are able to offer
more accessible discounted prices to consumers, our ability and success in presenting discounted prices on our platform
may be impeded and our business, financial condition, and results of operations would be adversely affected. For example,
in the first half of 2025, we observed that one of our PBM partners began offering other third-party discount cards on their
platform. This increased the direct competition we faced at the point-of-sale and had an adverse impact on our prescription
transactions revenue. If we cannot maintain a sufficient offering of discounted prices on our platform, new consumers and
existing consumers may perceive our platform as less relevant, consumer traffic to our platform could decline and, as a
result, new consumers and existing consumers may decrease their use of our platform or subscription offerings, which
would affect our contracts with certain partners included or otherwise involved with our platform and have a material adverse
effect on our business, financial condition, and results of operations.
We may be unable to maintain a positive perception regarding our platform or maintain and enhance our brand.
A decrease in the quality or perceived quality of the discounted prices available through our platform, or of our
telehealth offering, could harm our reputation and damage our ability to attract and retain consumers and partners included
or otherwise involved with our platform, which could adversely affect our business. Many factors that impact the perception
of our offerings are beyond our control.
Maintaining and enhancing our GoodRx brand and the branding and image of our various offerings, such as GoodRx
Care, is critical to our business and our ability to attract new and existing consumers to our platform. We expect that the
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promotion of our brand will require us to make substantial investments and as our market becomes more competitive, these
branding initiatives may become increasingly difficult and expensive. We have and may continue to decide to reduce such
investments, which may impact our ability to acquire or retain consumers, or other partners included or otherwise involved
with our platform. The successful promotion of our brand will depend largely on our marketing and public relations efforts. If
we do not successfully maintain and enhance our brand, we could lose consumer traffic, which could, in turn, cause PBMs,
partner pharmacies, pharma manufacturers and others to terminate or reduce the extent of their relationship with us. Our
brand promotion activities may not be successful or may not yield net revenues sufficient to offset this cost, which could
adversely affect our reputation and business.
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.
As a public company, we are required, pursuant to Section 404 of The Sarbanes-Oxley Act of 2002, or Section 404, to
furnish a report by management on the effectiveness of our internal control over financial reporting. This assessment
includes disclosure of any material weaknesses identified by our management in our internal control over financial reporting.
We are also required to comply with, among other requirements, the auditor attestation requirements of Section 404.
Our compliance with Section 404 requires that we incur substantial costs and expend significant management efforts.
We have engaged outside consultants who function in the capacity of an internal audit group, and we may engage with
additional consultants, accounting and financial staff with appropriate public company experience and technical accounting
knowledge as needed to maintain the system and process documentation necessary to perform the evaluation needed to
comply with Section 404.
We have had material weaknesses in our internal control over financial reporting in the past, and we cannot assure you
that there will not be material weaknesses in our internal control over financial reporting in the future. Any failure to maintain
internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results
of operations. If we are unable to conclude that our internal control over financial reporting is effective, or if our independent
registered public accounting firm determines that we have a material weakness in our internal control over financial
reporting, we may not be able to accurately report our financial condition or results of operations, which could cause
investors to lose confidence in our company, the market price of our Class A common stock could decline, and we could be
subject to sanctions or investigations by Nasdaq, the SEC or other regulatory authorities. Failure to remedy future material
weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required
of public companies, could also restrict our future access to the capital markets.
Use of social media, emails, and text messages may adversely impact our reputation, subject us to fines or other
penalties or be an ineffective source to market our offerings.
We use social media, emails, and text messages as part of our omnichannel approach to marketing and consumer
outreach. Changes to these social networking services’ terms of use or terms of service that limit promotional
communications, restrictions that would limit our ability or our consumers’ ability to send communications through their
services, disruptions or downtime experienced by these social networking services or reductions in the use of or
engagement with social networking services by consumers and potential consumers could also harm our business. As laws
and regulations rapidly evolve to govern the use of these channels, the failure by us, our employees or third parties acting at
our direction to abide by applicable laws and regulations in the use of these channels could adversely affect our reputation
or subject us to litigation, fines, or other damages or penalties. In addition, our employees or third parties acting at our
direction may knowingly or inadvertently make use of social media in ways that could lead to the loss or infringement of
intellectual property, as well as the public disclosure of proprietary, confidential, or personal information (including sensitive
or health-related information) ("Confidential Information") of our business, employees, consumers or others. Any such
inappropriate use of social media, emails, and text messages could also cause reputational damage and adversely affect
our business.
Our consumers may engage with us online through our social media pages, including, for example, our presence on
Facebook, Instagram, X (formerly known as Twitter), and TikTok, by providing feedback and public commentary about all
aspects of our business. Information concerning us or our offerings and brands, whether accurate or not, may be posted on
social media pages at any time and may have a disproportionately adverse impact on our brand, reputation, or business.
The harm may be immediate without affording us an opportunity for redress or correction and could have a material adverse
effect on our business, financial condition, results of operations, and prospects.
Additionally, we use emails and text messages to communicate with consumers and we collect consumer data,
including email addresses and phone numbers, to further our marketing efforts with such consenting consumers. If we fail to
adequately or accurately collect such data or if our data collection systems are breached, our business, financial condition,
and results of operations could be harmed. Further, any failure, or perceived failure, by us, or any third parties processing
such data, to comply with privacy policies or with any federal or state privacy or consumer protection-related laws,
regulations, industry self-regulatory principles, industry standards or codes of conduct, regulatory guidance, orders to which
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we may be subject or other legal obligations relating to privacy or consumer protection would adversely affect our reputation,
brand and business, and may result in claims, proceedings or actions against us by governmental entities, consumers,
suppliers or others or other liabilities or may require us to change our operations and/or cease using certain data sets.
We rely on information technology to operate our business and maintain competitiveness, and must adapt to
technological developments or industry trends.
Our ability to attract new consumers and increase revenue from our existing consumers depends in large part on our
ability to enhance and improve our existing offerings, increase adoption and usage of our offerings, and introduce new
features and capabilities. 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.
We depend on the use of information technologies and systems. As our operations grow, we must continuously improve
and upgrade our systems and infrastructure while maintaining or improving the reliability and integrity of our infrastructure.
Our future success also depends on our ability to adapt our systems and infrastructure to meet rapidly evolving consumer
trends and demands while continuing to improve the performance, features and reliability of our solutions in response to
competitive services and offerings. The emergence of alternative platforms such as smartphones and tablets and the
emergence of niche competitors who may be able to optimize offerings, services or strategies for such platforms will require
new investment in technology. New developments in other areas, such as cloud computing, artificial intelligence ("AI"), and
machine learning, have made it easier for competition to enter our markets due to lower up-front technology costs. In
addition, we may not be able to maintain our existing systems or replace or introduce new technologies and systems as
quickly as we would like or in a cost-effective manner. There is also no guarantee that we will possess the financial
resources or personnel, for the research, design, and development of new applications or services, or that we will be able to
utilize these resources successfully and avoid technological or market obsolescence. Further, there can be no assurance
that technological advances by one or more of our competitors or future competitors will not result in our present or future
applications and services becoming uncompetitive or obsolete. If we were unable to enhance our offerings and platform
capabilities to keep pace with rapid technological and regulatory change, or if new technologies emerge that are able to
deliver competitive offerings at lower prices, more efficiently, more conveniently or more securely than our offerings, our
business, financial condition, and results of operations could be adversely affected.
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 .
We collect and maintain information in digital form that is necessary to conduct our business, and we are increasingly
dependent on information technology systems and infrastructure (“IT Systems”) to operate our business. Additionally, in the
ordinary course of our business, we collect, store, and transmit large amounts of Confidential Information. It is critical that we
do so in a secure manner to maintain the confidentiality and integrity of such Confidential Information. We have established
certain physical, technical, and organizational measures designed to safeguard and secure our IT Systems and Confidential
Information, and also rely on commercially available systems, software, tools, and monitoring to provide security for our IT
Systems and the processing, transmission, and storage of Confidential Information. We have also outsourced elements of
our IT Systems and data storage systems, and as a result a number of third-party vendors may or could have access to our
Confidential Information.
Despite the implementation of certain preventative and detective security controls, such IT Systems are vulnerable to
damage or interruption from a variety of sources, including telecommunications or network failures or interruptions, system
malfunction, misconfigurations, natural disasters, malicious human acts, terrorism, and war. Such IT Systems, including our
servers, are additionally vulnerable to physical or electronic break-ins, security breaches from inadvertent or intentional
actions by our employees, third-party service providers, contractors, consultants, business partners, and/or other third
parties, or from cyber-attacks by malicious third parties, such as opportunistic hackers and hacktivists (including the
deployment of harmful malware, ransomware, denial-of-service attacks, social engineering, and other means to affect
service reliability and threaten the confidentiality, integrity, and availability of information). As we continue to embrace both
hybrid and remote working, we may face increased cybersecurity risks due to our reliance on internet technology and the
number of our employees who are working remotely, which may create additional opportunities for cybercriminals to exploit
vulnerabilities. We may not be able to anticipate all types of security threats, and we may not be able to implement
preventive measures that are effective against all such security threats. The techniques used by cyber criminals change
frequently, including through the use of AI, may not be recognized until launched, and can originate from a wide variety of
sources, including outside groups such as external service providers, organized crime affiliates, terrorist organizations, or
hostile foreign governments or agencies. Even if identified, we may be unable to adequately investigate or remediate
incidents or breaches due to attackers increasingly using tools and techniques that are designed to circumvent controls, to
avoid detection, and to remove or obfuscate forensic evidence. In addition, the prevalent use of mobile devices that access
Confidential Information increases the risk of data security breaches, which could lead to the loss of Confidential
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Information. Moreover, any integration of AI in our or any third party's operations, products or services is expected to pose
new or unknown cybersecurity risks and challenges.
We can provide no assurance that our current IT Systems, or those of the third parties upon which we rely, or
Confidential Information, are fully protected against cybersecurity threats. We and certain of our service providers from time
to time have been and are subject to cyberattacks and/or security incidents. Additionally, such cyberattacks and security
incidents have and may remain undetected for an extended period of time. Even when a security incident is detected, the full
extent of a breach, if any, may not be determined immediately. The costs to us to mitigate network security problems, bugs,
viruses, worms, malicious software programs, and security vulnerabilities could be significant, and while we have
implemented certain security measures to protect our Confidential Information and IT Systems, our efforts to address these
problems may not be successful. These problems, whether related to our IT Systems and/or those of third parties upon
which we rely, have resulted in, and may in the future, result in, unexpected interruptions, delays, cessation of service and
other harm to our business. While we do not believe that we have experienced a significant system failure, accident or
security breach to date that has had a material effect on us, including our operations, business strategy, results of
operations, or financial condition, if such an event were to occur and cause sustained material interruptions in our
operations, it could result in a material disruption of our offerings to consumers. Moreover, we and our third-party vendors
collect, store, and transmit Confidential Information in the ordinary course of our business. If a computer security breach
affects our systems or results in the unauthorized release of such Confidential Information, our reputation could be materially
damaged. In addition, such breaches have required, and may in the future require, notification to governmental agencies,
the media, or individuals pursuant to various federal and state privacy and security laws, as applicable, including HIPAA as
well as regulations promulgated by the FTC and state breach notification laws. Such breaches and allegations of such
breaches expose us to risks of loss and/or litigation and potential liability, which could materially adversely affect our
business, results of operations, and financial condition. There can be no assurance that our cybersecurity risk management
program and processes, including our policies, controls, or procedures, will be fully complied with or effective in protecting
our systems and information.
If our or our third-party vendors’ security measures fail or are breached, it could result in unauthorized access to
Confidential Information of our consumers, employees, partners, or contractors, a loss of or damage to our Confidential
Information, or an inability to access data sources, process data or provide our services. Such failures or breaches of our or
our third-party vendors’ security measures, or our or our third-party vendors’ inability to effectively resolve such failures or
breaches in a timely manner, could severely damage our reputation, adversely impact consumer, partner, or investor
confidence in us, and reduce the demand for our solutions and services. In addition, we could face litigation (including class
action), significant damages for contract breach or other breaches of law, significant monetary penalties, or regulatory
actions for violation of applicable laws or regulations, and incur significant costs for remedial measures to prevent future
occurrences and mitigate past violations. In addition, such breaches have required, and may require in the future,
notification to governmental agencies, the media, or individuals pursuant to various federal and state privacy and security
laws, as applicable, including HIPAA as well as regulations promulgated by the FTC and state breach notification laws. 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. If the IT Systems of our third-party vendors become subject to disruptions or
security breaches, we may have insufficient recourse against such third parties and we may have to expend significant
resources to mitigate the impact of such an event, and to develop and implement protections to prevent future events of this
nature from occurring. Any disruption or loss to IT Systems or Confidential Information on which critical aspects of our
operations depend could have an adverse effect on our business.
We use and may expand our use of AI and machine learning in our business and challenges with properly
managing their use could result in reputational harm, competitive harm and legal liability, and adversely affect our
results of operations .
We use AI and machine learning solutions in, and we may in the future integrate additional AI and/or machine learning
solutions into, our platform, offerings, products and services, and these applications may become important in our
operations over time. Our competitors or other industry participants may incorporate AI and/or machine learning into their
products more quickly or more successfully than us, which could change our market dynamics and could impair our ability to
compete effectively and adversely affect our results of operations. Additionally, if the content, analyses, or recommendations
that AI applications assist in producing are or are alleged to be deficient, inaccurate, or biased, our business, financial
condition, and results of operations may be adversely affected. Any cybersecurity incidents related to our use of AI and
machine learning applications could adversely affect our reputation and results of operations. AI and machine learning also
present emerging ethical issues and if our use of AI and/or machine learning becomes controversial, we may experience
brand or reputational harm, competitive, harm or legal liability. For example, various parties are leveraging existing laws to
advocate for liability based on certain AI-related actions, including instances of discriminatory, tortious, or other undesired
outcomes, and policymakers are adopting or considering the adoption of additional laws, regulations, or other actions with
respect to AI. The rapid evolution of AI and machine learning, including potential government regulation thereof, could
require us to devote significant resources to develop, test, and maintain our implementation of such technology in order to
minimize unintended, harmful impact.
The regulatory framework for AI technologies is also rapidly evolving as many federal, state, and foreign government
bodies and agencies have introduced or are currently considering additional laws and regulations. Existing laws and
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regulations may be interpreted in ways that would affect the operation of our AI technologies. As a result, implementation
standards and enforcement practices are likely to remain uncertain for the foreseeable future, and we cannot yet determine
the impact future laws, regulations, standards, or market perception of their requirements may have on our business and
may not always be able to anticipate how to respond to these laws or regulations.
Already, certain existing legal regimes (e.g., relating to data privacy) regulate certain aspects of AI technologies, and
new laws regulating AI technologies are expected to enter into force in the United States in 2025. The Trump administration
has rescinded an executive order relating to the safe and secure development of AI Technologies that was previously
implemented by the Biden administration. The Trump administration then issued a new executive order that, among other
things, requires certain agencies to develop and submit to the president action plans to “sustain and enhance America’s
global AI dominance,” and to specifically review and, if possible, rescind rule-making taken pursuant to the rescinded Biden
executive order. Thus, the Trump administration may continue to rescind other existing federal orders and/or administrative
policies relating to AI Technologies, or may implement new executive orders and/or other rule making relating to AI
Technologies in the future. Any such changes at the federal level could require us to expend significant resources to modify
our products, services, or operations to ensure compliance or remain competitive. Agencies such as the Department of
Commerce and the FTC have issued proposed rules governing the use and development of AI technologies. Legislation
related to AI technologies has also been introduced at the federal level and is advancing at the state level. For example, on
March 13, 2024, Utah passed the Utah AI Policy Act, which took effect in May 2024, imposing certain disclosure
requirements on the use of AI, and on May 17, 2024, Colorado enacted the Colorado AI Act, which will take effect in June
2026, and imposes various obligations on high-risk uses of AI. Further, the California Privacy Protection Agency has finalized
regulations under the CCPA regarding the use of automated decision-making. Such additional regulations may impact our
ability to develop, use and commercialize AI technologies in the future.
It is possible that further new laws and regulations will be adopted in the United States, or that existing laws and
regulations, including competition and antitrust laws, may be interpreted in ways that would limit our ability to use AI
technologies for our business, or require us to change the way we use AI technologies in a manner that negatively affects
the performance of our business and the way in which we use AI technologies. We may need to expend resources to adjust
our operations in certain jurisdictions if the laws, regulations, or decisions are not consistent across jurisdictions. Further, the
cost to comply with such laws, regulations, or decisions and/or guidance interpreting existing laws, could be significant and
would increase our operating expenses (such as by imposing additional reporting obligations regarding our use of AI
technologies). Such an increase in operating expenses, as well as any actual or perceived failure to comply with such laws
and regulations, could adversely affect our business, financial condition, and results of operations.
Government regulation of the internet and e-commerce is evolving, and unfavorable changes or failure by us to
comply with these laws and regulations could substantially harm our business and results of operations.
We are subject to general business regulations and laws specifically governing the internet and e-commerce.
Furthermore, the regulatory landscape impacting these areas is constantly evolving. Existing and future regulations and laws
could impede the growth of the internet, e-commerce, or other online services. These regulations and laws may involve
taxation, tariffs, privacy and data security, anti-spam, data protection, content, copyrights, distribution, electronic contracts,
electronic communications, money laundering, electronic payments, and consumer protection. It is not clear how existing
laws and regulations governing issues such as property ownership, sales and other taxes, libel and personal privacy apply
to the internet as the vast majority of these laws and regulations were adopted prior to the advent of the internet and do not
contemplate or address the unique issues raised by the internet or e-commerce. It is possible that general business
regulations and laws, or those specifically governing the internet or e-commerce may be interpreted and applied in a manner
that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices.
We cannot assure you that our practices have complied, comply or will in the future comply with all such laws and
regulations. Any failure, or perceived failure, by us to comply with any of these laws or regulations could result in damage to
our reputation, a loss in business, and proceedings or actions against us by governmental entities or others. For example,
recent automatic renewal laws, which require companies to adhere to enhanced disclosure requirements when entering into
automatically renewing contracts with consumers, resulted in class action lawsuits against companies that offer online
products and services on a subscription or recurring basis. These and similar proceedings or actions could hurt our
reputation, force us to spend significant resources in defense of these proceedings, distract our management, increase our
costs of doing business, and cause consumers and paid merchants to decrease their use of our platform, and may result in
the imposition of monetary liability. We may also be contractually liable to indemnify and hold harmless third parties from the
costs or consequences of non-compliance with any such laws or regulations. In addition, it is possible that governments of
one or more countries may seek to censor content available on our apps and websites or may even attempt to completely
block access to our platform. Adverse legal or regulatory developments could substantially harm our business.
Our business relies on email, mail, and other messaging channels and any technical, legal or other restrictions on
the sending of such correspondence or a decrease in consumer willingness to receive such correspondence could
adversely affect our business.
Our business depends in part upon the emailing and mailing of promotional materials, cards with GoodRx codes and
other information to consumers and healthcare providers, and is also significantly dependent on email and other messaging
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channels, such as text messages. We distribute pricing information and other promotional materials in the mail, and also
provide emails, mobile alerts, and other messages to consumers informing them of the discounted prices available on our
apps and websites. These communications help generate a significant portion of our revenues. 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.
Actions taken by third parties that block, impose restrictions on or charge for the delivery of these communications could
also harm our business. For example, from time to time, internet service providers or other third parties may block bulk
communications or otherwise experience difficulties that result in our inability to successfully deliver communications to
consumers. In addition, our use of mail, email and other messaging channels to send communications about our platform or
other matters, including health related topics referencing particular prescriptions or conditions, may result in legal claims
against us, which if successful might limit or prohibit our ability to send such communications.
We rely on a single third-party service provider for the delivery of substantially all of our mailing communications and
rely on third-party service providers for delivery of emails, text messages, and other forms of electronic communication. If we
were unable to use any one of our current service providers, alternate providers are available; however, we believe our
revenue could be impacted for some period as we transition to a new provider, and the new provider may be unable to
provide equivalent or satisfactory services. Any disruption or restriction on the distribution of our communications,
termination or disruption of our relationships with our third-party service providers, particularly our single third-party service
provider for the delivery of mail communications, or any increase in the associated costs, may be beyond our control and
would adversely affect our business.
We face the risk of litigation resulting from unauthorized text messages sent in violation of the Telephone
Consumer Protection Act.
We send short message service (“SMS”) text messages to individuals who are eligible to use our service. The actual or
perceived improper sending of text messages may subject us to potential risks, including liabilities or claims relating to
consumer protection laws. Numerous class action suits under federal and state laws have been filed in recent years against
companies who conduct SMS texting programs, with many resulting in multi-million-dollar settlements to the plaintiffs. We
have been, and in the future may be subject to such litigation, which could be costly and time-consuming to defend. The
Telephone Consumer Protection Act (TCPA) of 1991, a federal statute that protects consumers from unwanted telephone
calls, faxes, and text messages, restricts telemarketing and the use of automated SMS text messages without proper
consent. Federal or state regulatory authorities or private litigants may claim that the notices and disclosures we provide,
form of consents we obtain or our SMS texting practices are not adequate or violate applicable law. This has resulted and
may in the future result in civil claims against us. The scope and interpretation of the laws that are or may be applicable to
the delivery of text messages are continuously evolving and developing. If we do not comply with these laws or regulations
or if we become liable under these laws or regulations, we could face direct liability, could be required to change some
portions of our business model, could face negative publicity and our business, financial condition, and results of operations
could be adversely affected. Even an unsuccessful challenge of our SMS texting practices by our consumers, regulatory
authorities, or other third parties could result in negative publicity and could require a costly response from and defense by
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 .
In connection with running our business, we receive, store, use and otherwise process information that relates to
individuals and/or constitutes “personal data,” “protected health information,” “consumer health data,” “personal information,”
“personally identifiable information,” or similar terms under applicable data privacy laws (collectively, “Personal Information”).
We are therefore subject to laws, regulations and other requirements relating to the privacy, security and handling of
Personal Information
Laws, regulations, and other requirements relating to Personal Information, (including privacy, data protection,
marketing and advertising, and consumer protection) are evolving and subject to potentially differing interpretations,
particularly as they involve classes of data deemed to be sensitive. These requirements may be interpreted and applied in a
manner that varies from one jurisdiction to another and/or may conflict with other law, regulations, and regulatory
interpretations. As a result, our practices may not have complied or may not comply in the future with all such laws,
regulations, requirements, and obligations. Any failure, or perceived failure, by us or any of our third-party partners, data
centers, or service providers to comply with privacy policies or federal or state privacy or consumer protection-related laws,
regulations, regulatory interpretations, industry self-regulatory principles, industry standards or codes of conduct, regulatory
guidance, orders to which we may be subject, or other legal obligations relating to Personal Information, could adversely
affect our reputation, brand, and business, and may result in claims, proceedings or actions against us by governmental
entities, consumers, suppliers, or others. These proceedings may result in financial liabilities or may require us to change
our operations, including ceasing the use or sharing of certain data sets, or modifying marketing and other user engagement
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programs and plans. Any such claims, proceedings or actions could hurt our reputation, brand and business, force us to
incur significant expenses in defense of such proceedings or actions, distract our management, increase our costs of doing
business, result in a loss of consumers, suppliers, and contracts with PBMs and others and result in the imposition of
monetary penalties. We are also contractually required to indemnify and hold harmless certain third parties from the costs or
consequences of non-compliance with any laws, regulations, regulatory interpretations, or other legal obligations relating to
Personal Information or any inadvertent or unauthorized use or disclosure of Personal Information or other data that we
store or handle as part of operating our business.
Federal and state governmental authorities continue to evaluate the privacy implications inherent in the use of third-
party cross-site behavioral advertising technologies and other methods of online tracking for behavioral advertising and
other purposes. The U.S. federal and state governments have enacted, and may in the future enact legislation, regulations
and regulatory interpretations impacting the ability of companies and individuals to engage in these activities, such as by
regulating the level of consumer notice and consent required before a company can employ cross-site behavioral advertising
technologies or other electronic tracking tools or the use of data gathered with such tools. 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. The regulation of the use of these cross-site behavioral advertising technologies and other current online tracking
and advertising practices or a loss in our ability to make effective use of services that employ such technologies could
increase our costs of operations and limit our ability to acquire new consumers on cost-effective terms and consequently,
materially and adversely affect our business, financial condition and results of operations.
Certain states have adopted data privacy and security laws and regulations, which govern the privacy, processing and
protection of health-related and other Personal Information. Such laws and regulations are subject to interpretation by
various courts and other governmental authorities, thus creating potentially complex compliance issues for us and our future
customers and strategic partners. For example, the CCPA requires covered businesses that process the Personal
Information of California residents to, among other things: (i) provide certain disclosures to California residents regarding the
business’s collection, use, and disclosure of their Personal Information; (ii) receive and respond to requests from California
residents to access, delete, and correct their Personal Information, or to opt out of certain disclosures of their Personal
Information; and (iii) enter into specific contractual provisions with service providers that process California resident Personal
Information on the business’s behalf. Additional compliance investment and potential business process changes may be
required.
Washington state’s My Health My Data Act (“MHMDA”) went into effect in March 2024 and imposes additional
obligations and limitations regarding health-related Personal Information. The MHMDA differs from other state privacy laws
because of its broad definition of consumer health data and a broad private right of action. Other states have passed their
own data privacy and security laws, and such laws are also continuing to be proposed at the state and federal level. Other
states have enacted and may be considering similar laws to the MHMDA. Historically, laws with private rights of action have
resulted in numerous class action suits under federal and state laws resulting in multi-million-dollar settlements to the
plaintiffs. We have been, and in the future may be, subject to such litigation. We may be subject to claims 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, and these claims could be costly and time consuming
to defend.
Additionally, the interpretations of existing federal and state consumer protection laws relating to online collection, use,
dissemination, and security of health related and other P ersonal Information adopted by the FTC state attorneys general,
private plaintiffs, and courts have evolved, and may continue to evolve, over time. 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. If such information
that we publish is considered untrue, we may be subject to government claims of unfair or deceptive trade practices, which
could lead to significant liabilities and consequences. Furthermore, the FTC also has authority to initiate enforcement actions
against entities that make deceptive statements about privacy and data sharing in privacy policies, fail to limit third-party use
of Personal Information, fail to implement policies to protect Personal Information or engage in other unfair practices that
harm customers or that may violate Section 5(a) of the FTC Act. According to the FTC, violating consumers’ privacy rights or
failing to take appropriate steps to keep consumers’ Personal Information secure may constitute unfair acts or practices in or
affecting commerce and thus violate Section 5(a) of the FTC Act. The FTC expects a company’s data security measures to
be reasonable and appropriate in light of the sensitivity and volume of Personal Information it holds, the size and complexity
of its business, and the cost of available tools to improve security and reduce vulnerabilities. Individually identifiable health
information is considered sensitive data that merits stronger safeguards. The FTC and many state Attorneys General also
continue to enforce federal and state consumer protection laws against companies for online collection, use, dissemination
and security practices that appear to be unfair or deceptive. These consumer protection laws are increasingly being applied
by the FTC and state Attorneys General to regulate the collection, use, storage and disclosure of personal or Personal
Information, through websites or otherwise, and to regulate the presentation of website content. For example , as of
December 31, 2025, we estimated a probable loss of $30.5 million relating to an ongoing settlement negotiation in the
Northern District of California with respect to a class-action lawsuit involving our privacy and information sharing practices.
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Additionally, we rely on a variety of marketing techniques, including email and social media marketing and postal
mailings, and we are subject to various laws, regulations, and regulatory interpretations that govern such marketing and
advertising practices (such as the CAN-SPAM Act). A variety of federal and state laws, regulations and regulatory
interpretations govern the collection, use, retention, sharing and security of Personal Information, particularly in the context
of online advertising, which we rely upon to attract new consumers.
In addition, HIPAA, which applies to parts of our business, imposes on entities within its jurisdiction, among other things,
certain standards relating to the privacy, security, transmission and breach reporting of individually identifiable health
information. 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. HIPAA mandates the
reporting of certain breaches of health information to the U.S. Department of Health and Human Services ("HHS"), affected
individuals and if the breach is large enough, the media. We have experienced such breaches in the past and could be
exposed to a risk of loss or litigation and potential liability, which could materially adversely affect our business, results of
operations, and financial condition.
In addition, to the extent we or our other contractors or agents receive or obtain individually identifiable health
information from patients, healthcare providers, pharmacies, or other individuals or entities, we could be subject to criminal
penalties if we mishandle individually identifiable health information in a manner that is not authorized or permitted by
HIPAA. Claims that we have violated individuals’ privacy rights or breached our contractual obligations, even if we are not
found liable, could be expensive and time-consuming to defend and could result in adverse publicity that could harm our
business.
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.
As a result of regulatory enforcement proceedings and inquiries, we have been, and may in the future be, subject to
related litigation, settlements, or enforcement actions that have included or could include monetary penalties and/or
compliance requirements that (1) impose significant and material costs, (2) require us to make modifications to our data
practices and our marketing programs, (3) result in negative publicity, or (4) have a negative impact on consumer demand
for our products and services, or on our commercial or industry relationships. Relatedly, there has also been, and may in the
future also be, significant and material resource burdens on us, requirements that certain aspects of our operations to be
overseen by an independent monitor, and/or limitations or the elimination of our ability to use certain targeting marketing
strategies or work with certain third-party vendors. Even an unsuccessful challenge of our privacy practices by our
consumers, regulatory authorities or other third parties could result in negative publicity and could require a costly response
from and defense by us. Any of these events could adversely affect our ability to operate our business and our financial
results.
We may be unable to realize expected benefits from our restructuring and cost reduction efforts and our business
might be adversely affected.
In order to operate more efficiently and control costs, from time to time, we announce restructuring plans and other cost
savings initiatives, which include workforce reductions as well as re-balancing of products and services to align with our
business strategy. These plans are intended to generate, among other things, operating expense savings and improved
margins and profitability. 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. In addition, while positions have been eliminated, certain functions
necessary to our operations remain, and we may be unsuccessful in distributing the duties and obligations of departed
employees among our remaining employees. Any reduction in workforce could also make it difficult for us to pursue, or
prevent us from pursuing, new opportunities and initiatives due to insufficient personnel, or require us to incur additional and
unanticipated costs to hire new personnel to pursue such opportunities or initiatives. 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.
Our ability to utilize our net operating loss carryforwards and certain other tax attributes may be limited.
Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the “Code”) if a corporation
undergoes an “ownership change” (generally defined as a change (by value) in its equity ownership by more than 50
percentage points over a rolling three-year period), the corporation’s ability to use its pre-change net operating loss (“NOL”)
carryforwards and other pre-change tax attributes to offset its post-change income may be limited. We completed a study to
assess whether an ownership change under Section 382 of the Code had occurred, or whether there had been multiple
ownership changes since our formation date through December 31, 2025. We determined that a Section 382 ownership
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change occurred in 2018, but we also determined that this ownership change did not materially impact our ability to utilize
our NOL carryforwards and certain other tax attributes generated that year. We may have experienced additional ownership
changes since December 31, 2025, and we may also experience ownership changes in the future as a result of subsequent
shifts in our stock ownership. Further, U.S. tax laws limit the time during which NOL carryforwards generated before January
1, 2018 may be applied against future taxes. While NOL carryforwards generated on or after January 1, 2018 are not subject
to expiration, the deductibility of such NOL carryforwards is limited to 80% of our taxable income for taxable years beginning
on or after January 1, 2021. For these reasons, our ability to utilize NOL carryforwards and other tax attributes to reduce
future tax liabilities may be limited.
We rely on the performance of members of management and highly skilled personnel, and if we are unable to
attract, develop, motivate and retain well-qualified employees, our business could be harmed.
Our ability to maintain our competitive position is largely dependent on the services of our senior management and
other key personnel. In addition, our future success depends on our continuing ability to attract, develop, motivate, and
retain highly qualified and skilled employees. Competition for such personnel is extremely intense. To attract and retain such
personnel, we have had to offer, and believe we will need to continue to offer, highly competitive compensation packages.
However, we have experienced and may continue to experience difficulties in hiring and retaining these personnel at
compensation levels consistent with our existing compensation and salary structure. Some of the companies with which we
compete for experienced employees have greater resources than we have and may be able to offer more attractive terms of
employment. We have needed and may in the future need to invest significant amounts of cash and equity to attract and
retain employees and we may not realize sufficient returns on these investments. In addition, the loss of any of our senior
management or other key employees, the failure to successfully transition key roles, or our inability to recruit, develop, and
retain qualified personnel could materially and adversely affect our ability to execute our business plan and we may be
unable to find adequate replacements. For instance, in December 2024, our board of directors (our "Board") appointed
Wendy Barnes as our Chief Executive Officer and President as Scott Wagner transitioned from his prior role as our Interim
Chief Executive Officer, and in February 2025 we transitioned our Chief Financial Officer role. Any inability to successfully
transition executive or senior management roles could adversely impact our business.
All of our employees are at-will employees, meaning that they may terminate their employment relationship with us at
any time, and their knowledge of our business and industry would be extremely difficult to replace. If we fail to retain talented
senior management and other key personnel, or if we do not succeed in attracting well-qualified employees or retaining and
motivating existing employees, our business, financial condition, and results of operations may be materially adversely
affected.
A pandemic, epidemic, or outbreak of an infectious disease in the United States, has and could in the future
adversely impact our business.
Any pandemic, endemic, or other infectious disease may adversely affect our business, results of operations, and
financial condition by changing the way our consumers access healthcare and utilize our platform, or by causing us to
modify our business practices.
The COVID-19 pandemic dramatically impacted global health and had a sustained impact on the macroeconomic
environment, including by increasing economic uncertainty. Although measures to contain COVID-19 have largely eased,
the lasting effect of the pandemic's business disruption and its continued financial impact depend on factors beyond our
knowledge and control.
While the potential economic impact brought by and the duration of any pandemic, epidemic, or outbreak of an
infectious disease, including COVID-19, may be difficult to assess or predict, the widespread COVID-19 pandemic has
resulted in, and may continue to result in, significant disruption of global financial markets, reducing our ability to access
capital or to do so on favorable terms, which could in the future negatively affect our liquidity. The impact of any pandemic,
epidemic, or outbreak of an infectious disease on the needs, expectations, and spending patterns of our consumers could
impact our ability to maintain or grow our business and, as a result, our operating and financial results could be adversely
affected.
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.
Although we only operate in the United States, our business, financial performance, and results of operations depend in
part on worldwide macroeconomic economic conditions and their impact on consumer spending. 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
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spending or buying habits could materially and adversely affect our customers, our consumers, and demand for our
offerings. Volatility in the financial markets and deterioration in economic conditions, increasing inflation or increasing
unemployment levels have also had and may continue to have a negative impact on consumer spending patterns. Changes
and uncertainty can, among other things, reduce or shift spending away from medical treatments, procedures and doctors’
office visits.
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. This may affect their ability to renew contracts with us on the same or
better terms, which could impact the competitiveness of the discounted prices we are able to offer our consumers. Trade
barriers, duties, tariffs, executive actions, and retaliatory measures by the U.S. and other governments may impact the
pharma manufacturers we contract with by increasing their costs of business, which could cause them to decrease their
marketing spend on our offerings. 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.
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
make our offerings less competitive, increase general and administrative expenses, and otherwise adversely affect our
financial condition and results of operations.
Additionally, global public health crises, natural disasters, such as earthquakes and wildfires, and other adverse weather
and climate conditions, political crises, such as terrorist attacks, war, and other political instability, or other unexpected
events, could disrupt our operations, internet or mobile networks or the operations of PBMs and their pharmacy networks.
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. For more information, see our risk factor titled “ We are subject to a
series of risks related to climate change .” If any of these events occurs, our business could be adversely affected.
We may seek to grow our business through acquisitions of, or investments in, new or complementary businesses,
technologies or products, or through strategic alliances, and the failure to manage these acquisitions, investments,
or alliances, or to integrate them with our existing business, could have a material adverse effect on us.
We have completed a number of strategic acquisitions in the past and may in the future consider opportunities to
acquire or make investments in new or complementary businesses, technologies, offerings, or products, or enter into
strategic alliances, that may enhance our capabilities, expand our pharmacy or PBM networks and healthcare platform in
general, complement our current offerings or expand the breadth of our markets. Our ability to successfully grow through
these types of strategic transactions depends upon our ability to identify, negotiate, complete and integrate suitable target
businesses, technologies and products and to obtain any necessary financing, and is subject to numerous risks, including:
• failure to identify acquisition, investment, or other strategic alliance opportunities that we deem suitable or
available on favorable terms;
• problems integrating the acquired business, technologies, or products, including issues maintaining uniform
standards, procedures, controls, and policies;
• unanticipated costs associated with acquisitions, investments, or strategic alliances;
• adverse impacts on our overall margins;
• diversion of management’s attention from our existing business;
• adverse effects on existing business relationships with consumers, pharmacies, PBMs, and pharma
manufacturers;
• risks associated with entering new markets in which we may have limited or no experience;
• potential loss of key employees of acquired businesses; and
• increased legal and accounting compliance costs.
In addition, a significant portion of the purchase price of companies we acquire may be allocated to acquired goodwill
and other intangible assets. In the future, if our acquisitions do not yield expected returns, we may be required to take
impairment charges to our results of operations based on our impairment assessment process, which could harm our results
of operations.
From time to time, we may pursue dispositions or other strategic transactions. Dispositions and other strategic
transactions may not have the anticipated impact on our business, may negatively impact revenues and may make it difficult
to generate cash flows to meet our cash requirements.
If we are unable to identify suitable acquisitions or strategic relationships, or if we are unable to integrate any acquired
businesses, technologies, and products effectively, our business, financial condition and results of operations could be
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materially and adversely affected. Also, while we employ several different methodologies to assess potential business
opportunities, the new businesses may not meet or exceed our expectations.
Restrictions in our debt arrangements could adversely affect our operating flexibility, and failure to comply with
any of these restrictions could result in acceleration of our debt.
As of December 31, 2025 , we had $495.0 million of principal amounts outstanding under a term loan that requires
quarterly principal payments with any remaining unpaid principal and any accrued and unpaid interest due upon maturity in
July 2029. We also have a revolving credit facility and as of December 31, 2025 , 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). Our current and additional debt arrangements that we expect to enter into
in the future may limit our ability to, among other things:
• incur or guarantee additional debt;
• pay dividends and make other restricted payments;
• make certain investments and acquisitions;
• incur certain liens or permit them to exist;
• consolidate, merge or otherwise transfer, sell or dispose of all or substantially all of our assets;
• enter into certain types of restrictive agreements; and
• enter into certain types of transactions with affiliates.
We are also required to comply with certain financial ratios set forth in our existing debt arrangements. Certain
provisions in our current and future debt arrangements may affect our ability to obtain future financing and to pursue
attractive business opportunities and our flexibility in planning for, and reacting to, changes in business conditions. As a
result, restrictions in our current and future debt arrangements could adversely affect our business, financial condition, and
results of operations. In addition, a failure to comply with the provisions of our current and future debt arrangements could
result in a default or an event of default that could enable our lenders to declare the outstanding principal of that debt,
together with accrued and unpaid interest, to be immediately due and payable. If we were unable to repay those amounts,
the lenders under our existing and any other future secured debt agreements could proceed against the collateral granted to
them to secure that indebtedness.
We have pledged substantially all of our subsidiaries’ assets, including, among other things, equity interests of GoodRx,
Inc. and its subsidiaries, as collateral under our existing debt arrangements. If the payment of outstanding amounts under
our existing debt arrangement is accelerated, our assets may be insufficient to repay such amounts in full, and our common
stockholders could experience a partial or total loss of their investment.
Our business depends on network and mobile infrastructure and our ability to maintain and scale our technology.
Any significant interruptions or delays in service on our apps or websites or any undetected errors or design faults
could result in limited capacity, reduced demand, processing delays, and loss of consumers.
A key element of our strategy is to generate a significant number of visitors to, and their use of, our apps and websites.
Our reputation and ability to acquire, retain, and serve our consumers are dependent upon the reliable performance of our
apps and websites and the underlying network infrastructure. As our base of consumers and the amount of information
shared on our apps and websites continue to grow, we will need an increasing amount of network capacity and computing
power. We have spent and expect to continue to spend substantial amounts on computing, including cloud computing and
the related infrastructure, to handle the traffic on our apps and websites. The operation of these systems is complex and
could result in operational failures. In the event that the traffic of our consumers exceeds the capacity of our current network
infrastructure or in the event that our base of consumers or the amount of traffic on our apps and websites grows more
quickly than anticipated, we may be required to incur significant additional costs to enhance the underlying network
infrastructure. Interruptions or delays in these systems, whether due to system failures, computer viruses, physical or
electronic break-ins, undetected errors, design faults or other unexpected events or causes, could affect the security or
availability of our apps and websites and prevent our consumers from accessing our apps and websites. If sustained or
repeated, these performance issues could reduce the attractiveness of our offerings. In addition, the costs and complexities
involved in expanding and upgrading our systems may prevent us from doing so in a timely manner and may prevent us
from adequately meeting the demand placed on our systems. Any internet or mobile platform interruption or inadequacy that
causes performance issues or interruptions in the availability of our apps or websites could reduce consumer satisfaction
and result in a reduction in the number of consumers using our offerings.
We depend on the development and maintenance of the internet and mobile infrastructure. This includes maintenance
of reliable internet and mobile infrastructure with the necessary speed, data capacity and security, as well as timely
development of complementary offerings, for providing reliable internet and mobile access. Our business, financial condition
and results of operations could be materially and adversely affected if for any reason the reliability of our internet and mobile
infrastructure is compromised.
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We currently rely upon third-party data storage providers, including cloud storage solution providers, such as Amazon
Web Services and some specific uses of Google Cloud Platform. Nearly all of our data storage and analytics are conducted
on, and the data and content we create associated with sales on our apps and websites are processed through servers
hosted by these providers, particularly Amazon Web Services. We also rely on email service providers, bandwidth providers,
internet service providers, and mobile networks to deliver email and “push” communications to consumers and to allow
consumers to access our websites. If our third-party vendors are unable or unwilling to provide the services necessary to
support our business, or if our agreements with such vendors are terminated, our operations could be significantly disrupted.
Some of our vendor agreements may be unilaterally terminated by the licensor for convenience, including with respect to
services provided by Google, and if such agreements are terminated, we may not be able to enter into similar relationships
in the future on reasonable terms or at all.
Any damage to, or failure of, our systems or the systems of our third-party data centers or our other third-party providers
could result in interruptions to the availability or functionality of our apps and websites. As a result, we could lose consumer
data and miss opportunities to acquire and retain consumers, which could result in decreased revenue. If for any reason our
arrangements with our data centers or third-party providers are terminated or interrupted, such termination or interruption
could adversely affect our business, financial condition, and results of operations. We exercise little control over these
providers, which increases our vulnerability to problems with the services they provide. We could experience additional
expense in arranging new facilities, technology, services, and support. In addition, the failure of our third-party data centers
or any other third-party providers to meet our capacity requirements could result in interruption in the availability or
functionality of our apps and websites.
The satisfactory performance, reliability and availability of our apps, websites, transaction processing systems, and
technology infrastructure are critical to our reputation and our ability to acquire and retain consumers, as well as to maintain
adequate consumer service levels. Our revenue depends in part on the number of consumers that visit and use our apps
and websites in fulfilling their healthcare needs. Unavailability of our apps or websites could materially and adversely affect
consumer perception of our brand. Any slowdown or failure of our apps, websites or the underlying technology infrastructure
could harm our business, reputation and our ability to acquire, retain and serve our consumers.
The occurrence of a natural disaster, power loss, telecommunications failure, data loss, computer virus, an act of
terrorism, cyberattack, vandalism or sabotage, act of war or any similar event, or a decision to close our third-party data
centers on which we normally operate or the facilities of any other third-party provider without adequate notice or other
unanticipated problems at these facilities could result in lengthy interruptions in the availability of our apps and websites.
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. If a
natural disaster, blackout, or other unforeseen event were to occur that disrupted the ability to obtain an internet connection,
we may experience a slowdown or delay in our operations. While we have some limited disaster recovery arrangements in
place, our preparations may not be adequate to account for disasters or similar events that may occur in the future and may
not effectively permit us to continue operating in the event of any problems with respect to our systems or those of our third-
party data centers or any other third-party facilities. Our disaster recovery and data redundancy plans may be inadequate,
and our business interruption insurance may not be sufficient to compensate us for the losses that could occur. If any such
event were to occur to our business, our operations could be impaired and our business, financial condition, and results of
operations may be materially and adversely affected.
We rely on third-party platforms such as the Apple App Store and Google Play App Store, to distribute our platform
and offerings.
Our apps are accessed and operate through third-party platforms or marketplaces, including the Apple App Store and
Google Play App Store, which also serve as significant online distribution platforms for our apps. As a result, the expansion
and prospects of our business and our apps depend on our continued relationships with these providers and any other
emerging platform providers that are widely adopted by consumers. We are subject to the standard terms and conditions
that these providers have for application developers, which govern the content, promotion, distribution, and operation of
apps on their platforms or marketplaces, and which the providers can change unilaterally on short or no notice. Our business
would be harmed if the providers discontinue or limit our access to their platforms or marketplaces; the platforms or
marketplaces decline in popularity; the platforms modify their algorithms, communication channels available to developers,
respective terms of service or other policies, including fees; the providers adopt changes or updates to their technology that
impede integration with other software systems or otherwise require us to modify our technology or update our apps in order
to ensure that consumers can continue to access and use our GoodRx codes and pricing information.
If alternative providers increase in popularity, we could be adversely impacted if we fail to create compatible versions of
our apps in a timely manner, or if we fail to establish a relationship with such alternative providers. Likewise, if our current
providers alter their operating platforms, we could be adversely impacted as our offerings may not be compatible with the
altered platforms or may require significant and costly modifications in order to become compatible. If our providers do not
perform their obligations in accordance with our platform agreements, we could be adversely impacted.
In the past, some of these platforms or marketplaces have been unavailable for short periods of time. If this or a similar
event were to occur on a short- or long-term basis, or if these platforms or marketplaces otherwise experience issues that
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impact the ability of consumers to download or access our apps and other information, it could have a material adverse
effect on our brand and reputation, as well as our business, financial condition, and operating results.
We rely on software-as-a-service (“SaaS”) technologies from third parties.
We rely on SaaS technologies from third parties in order to operate critical functions of our business, including financial
management services, relationship management services, marketing services, and data storage services. For example, we
rely on Amazon Web Services for a substantial portion of our computing and storage capacity. We also rely on Google for
storage capacity and advertising services, and Google may update the terms of its services unilaterally by providing
advance notice and posting changed terms on its website. In addition, Google may terminate certain agreements with us
immediately upon notice. Certain of our other vendor agreements may be unilaterally terminated by the counterparty for
convenience. If these services become unavailable due to contract cancellations, extended outages, or interruptions or
because they are no longer available on commercially reasonable terms or prices, or for any other reason, our expenses
could increase, our ability to manage our finances could be interrupted, our processes for managing our offerings and
supporting our consumers and partners could be impaired and our ability to access or save data stored to the cloud may be
impaired until equivalent services, if available, are identified, obtained, and implemented, all of which could harm our
business, financial condition, and results of operations.
We depend on our relationships with third parties and would be adversely impacted by system failures or other
disruptions in the operations of these parties.
We use and rely on services from third parties, such as our telecommunications services and telehealth services, and
those services may be subject to outages and interruptions that are not within our control. Failures by our
telecommunications providers may interrupt our ability to provide phone support to our consumers and distributed denial of
service attacks directed at our telecommunication service providers could prevent consumers from accessing our websites.
In addition, we have in the past and may in the future experience down periods where our third-party credit card processors
are unable to process the payments of our consumers, disrupting our ability to process or receive revenue from our
subscription offerings. Disruptions to our telehealth offering, consumer support, website, and credit card processing services
could lead to consumer dissatisfaction, which would adversely affect our business, financial condition, and results of
operations.
Changes in consumer sentiment or laws, rules, or regulations regarding the use of cookies and other tracking
technologies and other privacy matters could have a material adverse effect on our ability to generate revenues,
could adversely affect our ability to collect proprietary data on consumer behavior, and could result in material
financial penalties.
Consumers may become increasingly resistant to the collection, use and sharing of information online, including
information used to deliver and optimize advertising, and take steps to prevent such collection, use and sharing of
information. For example, consumer complaints and/or lawsuits regarding online advertising or the use of cookies or other
tracking technologies in general and our practices specifically could adversely impact our business.
Consumers can currently opt out of the placement or use of most cookies for online advertising purposes in various
ways, including: (i) by submitting opt-out requests under privacy laws, (ii) deleting or disabling cookies on their browsers, (iii)
visiting websites that allow consumers to place an opt-out cookie on their browsers, which instructs participating entities not
to use certain data about consumers’ online activity for the delivery of targeted advertising, or (iv) by downloading browser
plug-ins and other tools that can be set to: identify cookies and other tracking technologies used on websites; prevent
websites from placing third-party cookies and other tracking technologies on the consumer’s browser; or block the delivery
of online advertisements on apps and websites.
Various software tools and applications have been developed that can block advertisements from a consumer’s screen
or allow consumers to shift the location in which advertising appears on webpages or opt out of display, search and internet-
based advertising entirely. In particular, Apple’s mobile operating system permits these technologies to work in its mobile
Safari browser. In addition, changes in device and software features could make it easier for internet users to prevent the
placement of cookies or to block other tracking technologies. In particular, the default settings of consumer devices and
software may be set to prevent the placement of cookies unless the user actively elects to allow them. 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.
We currently use cookies, pixel tags, and similar technologies from third-party advertising technology providers to
provide and optimize our advertising. If consumer sentiment regarding privacy issues or the development and deployment of
new browser solutions or other Do Not Track mechanisms result in a material increase in the number of consumers who
choose to opt out or block cookies and other tracking technologies or who are otherwise using browsers where they need to,
and fail to, allow the browser to accept cookies, or otherwise result in cookies or other tracking technologies not functioning
properly, our ability to advertise effectively and conduct our business, and our results of operations and financial condition
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would be adversely affected. Additionally, if we fail to honor consumer requests to opt-out of tracking technologies where
required by law, we could be the subject of litigation, investigations, or enforcement actions, which could result in material
financial penalties, injunctive relief, and reputational damage.
We are subject to a series of risks related to climate change .
There are inherent climate-related risks wherever business is conducted. Certain of the facilities we rely on, including
but not limited to offices and network infrastructure, are located in areas that have experienced, and are projected to
continue to experience, various meteorological phenomena (such as drought, heatwaves, wildfire, storms, and flooding,
among others) or other catastrophic events that may disrupt our or our suppliers’ operations, require us to incur additional
operating or capital expenditures, or otherwise adversely impact our business, financial condition, or results of operations.
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. While we may take various actions to mitigate our business risks associated with climate
change, this may require us to incur substantial costs and may not be successful, due to, among other things, the
uncertainty associated with the longer-term projections associated with managing climate risk.
Additionally, we expect to be subject to increased regulations, reporting requirements, standards, or expectations
regarding the environmental impacts of our business. For example, various regulators, including the State of California, have
adopted or are considering adopting requirements for disclosures or other actions regarding climate change, which are
expected to result in additional costs and attention from our management and Board. Such requirements are not uniform
across jurisdictions, which can increase the complexity and cost of compliance, and increase the risk of enforcement or
litigation relating to our disclosures. The expectations of various stakeholders, including customers and employees,
regarding such matters likewise continues to evolve. For more information, see our risk factor titled “ ESG initiatives could
increase our costs, harm our reputation, and adversely impact our financial results .” Changing market dynamics, global and
domestic policy developments, and the increasing frequency and impact of meteorological phenomena have the potential to
disrupt our business, the business of our suppliers and/or customers, or otherwise adversely impact our business, financial
condition, or results of operations.
ESG initiatives could increase our costs, harm our reputation, and adversely impact our financial results .
Certain stakeholders, including but not limited to investors, environmental activists, the media, and governmental and
nongovernmental organizations, have focused on issues such as climate change, human capital, and other ESG or
sustainability matters. Such 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. However, such initiatives can be costly, face unforeseen complications, and may not ultimately have the desired
results. For example, identification, assessment, management, and disclosure of such matters is complex and can require
substantial discretion. As with other companies, our approach to ESG practices and disclosures is likely to evolve, and we
cannot guarantee that our approach will align with the preferences or interpretations of any particular stakeholder. Moreover,
various stakeholders have different, and at times conflicting, expectations regarding such matters . This includes efforts by
policymakers both to mandate and prohibit consideration of certain ESG matters .
Both advocates and opponents to certain ESG matters are increasingly resorting to a range of activism forms, including
media campaigns and litigation, to advance their perspectives. To the extent we are subject to such activism, it may require
us to incur costs or otherwise adversely impact our business. Moreover, such competing expectations increase the
complexity of us navigating various ESG risks, and we may not do so successfully, either now or as such expectations
continue to evolve, which may result in various adverse impacts to our brand, operations, stakeholder relations, or other
aspects of our business. For example, failure to satisfy such evolving expectations (including any new legal requirements or
evolving expectations of existing laws) may result in reputational harm, loss of customers or content providers, regulatory or
investor engagement, or other adverse impacts to our business. As ESG best practices, reporting standards and regulatory
requirements continue to develop, we may incur increasing costs to comply and/or respond. Such ESG matters may also
impact our suppliers, business partners customers, or other stakeholders, which may compound or cause new impacts on
our business, financial condition, or results of operations.
Risks Related to Intellectual Property
We may be unable to establish, maintain, protect, and enforce our intellectual property and proprietary rights or
prevent third parties from making unauthorized use of our technology.
Our business depends on proprietary technology and content, including software, processes, databases, confidential
information, and know-how, the protection of which is crucial to the success of our business. We rely on a combination of
trademark, patent, copyright, domain name, and trade secret-protection laws, in addition to confidentiality agreements and
other practices to protect our brands, proprietary information, technologies, and processes.
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Our most material trademark asset is the registered trademark “GoodRx.” Our trademarks are valuable assets that
support our brand and consumers’ perception of our offerings. We also hold the rights to the “goodrx.com” internet domain
name, which are subject to internet regulatory bodies and trademark and other related laws of each applicable jurisdiction. If
we are unable to protect our trademarks or domain names in the United States or in other jurisdictions in which we may
ultimately operate, our brand recognition and reputation would suffer, we would incur significant re-branding expenses and
our operating results could be adversely impacted. From time to time, we also file patent applications in the U.S. covering
certain of our technology, including technology that we believe is critical to our business, and acquire patent assets to
supplement our portfolio. For example, one of our issued patents relates to our ability to combine prices from multiple PBMs
together in a single consumer interface. 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. 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. It is also possible that third parties, including our competitors,
may obtain patents relating to technologies that overlap or compete with our technology. If third parties obtain patent
protection with respect to such technologies, they may assert that our technology infringes their patents and seek to charge
us a licensing fee or otherwise preclude the use of our technology.
In order to protect our intellectual property rights, we may be required to spend significant resources to monitor and
protect these rights. Litigation may be necessary in the future to enforce our intellectual property rights and to protect our
trade secrets. Litigation brought to protect and enforce our intellectual property rights could be costly, time-consuming, and
distracting to management and could result in the impairment or loss of portions of our intellectual property. Furthermore, our
efforts to enforce our intellectual property rights may be met with defenses, counterclaims, and countersuits attacking the
validity and enforceability of our intellectual property rights. Our inability to protect our proprietary technology against
unauthorized copying or use, as well as any costly litigation or diversion of our management’s attention and resources, could
delay the introduction and implementation of new technologies, result in our substituting inferior or more costly technologies
into our software or injure our reputation. We will not be able to protect our intellectual property if we are unable to enforce
our rights or if we do not detect unauthorized use of our intellectual property. Moreover, policing unauthorized use of our
technologies, trade secrets, and intellectual property may be difficult, expensive, and time-consuming, particularly in foreign
countries where the laws may not be as protective of intellectual property rights as those in the United States and where
mechanisms for enforcement of intellectual property rights may be weak. If we fail to meaningfully establish, maintain,
protect, and enforce our intellectual property and proprietary rights, our business, financial condition, and results of
operations could be adversely affected.
We may be sued by third parties for infringement, misappropriation, dilution, or other violations of their intellectual
property or proprietary rights.
Internet, advertising, and e-commerce companies frequently are subject to litigation based on allegations of
infringement, misappropriation, dilution, or other violations of intellectual property rights. Some internet, advertising, and e-
commerce companies, including some of our competitors, as well as non-practicing entities, own large numbers of patents,
copyrights, trademarks, and trade secrets, which they may use to assert claims against us.
Third parties have asserted, and may in the future assert, that we have infringed, misappropriated, or otherwise violated
their intellectual property rights.
For instance, the use of our technology to provide our offerings could be challenged by claims that such use infringes,
dilutes, misappropriates or otherwise violates the intellectual property rights of a third party. In addition, we may in the future
be exposed to claims that content published or made available through our apps or websites violates third-party intellectual
property rights.
As we face increasing competition and as a public company, the possibility of intellectual property rights claims against
us grows. Such claims and litigation may involve patent holding companies or other adverse intellectual property rights
holders who have no relevant product revenue, and therefore our own pending patents and other intellectual property rights
may provide little or no deterrence to these rights holders in bringing intellectual property rights claims against us. There
may be intellectual property rights held by others, including issued or pending patents and trademarks, that cover significant
aspects of our technologies, content, branding, or business methods, and we cannot assure that we are not infringing or
violating, and have not violated or infringed, any third-party intellectual property rights or that we will not be held to have
done so or be accused of doing so in the future. We expect that we may receive in the future notices that claim we or our
partners, or clients using our solutions and services, have misappropriated or misused other parties’ intellectual property
rights, particularly as the number of competitors in our market grows and the functionality of applications amongst
competitors overlaps.
Any claim that we have violated intellectual property or other proprietary rights of third parties, with or without merit, and
whether or not it results in litigation, is settled out of court or is determined in our favor, could be time-consuming and costly
to address and resolve, and could divert the time and attention of management and technical personnel from our business.
Furthermore, an adverse outcome of a dispute may result in an injunction and could require us to pay substantial monetary
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damages, including treble damages and attorneys’ fees, if we are found to have willfully infringed a party’s intellectual
property rights. Any settlement or adverse judgment resulting from such a claim could require us to enter into a licensing
agreement to continue using the technology, content, or other intellectual property that is the subject of the claim; restrict or
prohibit our use of such technology, content or other intellectual property; require us to expend significant resources to
redesign our technology or solutions; and require us to indemnify third parties. Royalty or licensing agreements, if required
or desirable, may be unavailable on terms acceptable to us, or at all, and may require significant royalty payments and other
expenditures. We may also be required to develop alternative non-infringing technology, which could require significant time
and expense. 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. 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.
Failure to maintain, protect, or enforce our intellectual property rights could harm our business and results of
operations.
We pursue the registration of our patentable technology, domain names, trademarks, and service marks in the United
States. We also strive to protect our intellectual property rights by relying on federal, state, and common law rights, as well
as contractual restrictions. We typically enter into confidentiality and invention assignment agreements with our employees
and contractors, and confidentiality agreements with parties with whom we conduct business in order to limit access to, and
disclosure and use of, our proprietary information. However, we may not be successful in executing these agreements with
every party who has access to our confidential information or contributes to the development of our technology or intellectual
property rights. Those agreements that we do execute may be breached, and we may not have adequate remedies for any
such breach. These contractual arrangements and the other steps we have taken to protect our intellectual property rights
may not prevent the misappropriation or disclosure of our proprietary information nor deter independent development of
similar technology or intellectual property by others.
Effective trade secret, patent, copyright, trademark, and domain name protection is expensive to obtain, develop, and
maintain, both in terms of initial and ongoing registration or prosecution requirements and expenses and the costs of
defending our rights. We may, over time, increase our investment in protecting our intellectual property through additional
patent filings that could be expensive and time-consuming. We do not know whether any of our pending patent applications
will result in the issuance of additional patents or whether the examination process will require us to narrow our claims or we
may otherwise be unable to obtain patent protection for the technology covered in our pending patent applications. Our
patents, trademarks, and other intellectual property rights may be challenged by others or invalidated through administrative
process or litigation. Moreover, any issued patents may not provide us with a competitive advantage and, as with any
technology, competitors may be able to develop similar or superior technologies to our own, now or in the future. In addition,
due to a recent U.S. Supreme Court case, it has become increasingly difficult to obtain and assert patents relating to
software or business methods, as many such patents have been invalidated for being too abstract to constitute patent-
eligible subject matter. We do not know whether this will affect our ability to obtain new patents on our innovations, or
successfully assert our patents in litigation or pre-litigation campaigns.
Monitoring unauthorized use of the content on our apps and websites, and our other intellectual property and
technology, is difficult and costly. Our efforts to protect our proprietary rights and intellectual property may not have been and
may not be adequate to prevent their misappropriation or misuse. Third parties, including our competitors, could be
infringing, misappropriating, or otherwise violating our intellectual property rights. Third parties from time to time copy
content or other intellectual property or technology from our solutions without authorization and seek to use it for their own
benefit. We generally seek to address such unauthorized copying or use, but we have not always been successful in
stopping all unauthorized use of our content or other intellectual property or technology, and may not be successful in doing
so in the future. Further, we may not have been and may not be able to detect unauthorized use of our technology or
intellectual property, or to take appropriate steps to enforce our intellectual property rights. Any inability to meaningfully
enforce our intellectual property rights could harm our ability to compete and reduce demand for our solutions and services.
Our competitors may also independently develop similar technology. Effective patent, trademark, copyright, and trade secret
protection may not be available to us in every jurisdiction in which our solutions or technology are hosted or available.
Further, legal standards relating to the validity, enforceability and scope of protection of intellectual property rights are
uncertain. The laws in the United States and elsewhere change rapidly, and any future changes could adversely affect us
and our intellectual property. Our failure to meaningfully protect our intellectual property rights could result in competitors
offering solutions that incorporate our most technologically advanced features, which could reduce demand for our solutions.
We may find it necessary or appropriate to initiate claims or litigation to enforce our intellectual property rights, protect
our trade secrets or determine the validity and scope of intellectual property rights claimed by others. In any lawsuit we bring
to enforce our intellectual property rights, a court may refuse to stop the other party from using the technology at issue on
grounds that our intellectual property rights do not cover the use or technology in question. Further, in such proceedings, the
defendant could counterclaim that our intellectual property is invalid or unenforceable and the court may agree, in which
case we could lose valuable intellectual property rights. Litigation is inherently uncertain and any litigation of this nature,
regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any
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of which could adversely affect our business and results of operations. If we fail to maintain, protect and enforce our
intellectual property, our business and results of operations may be harmed.
We may be unable to continue the use of our trademarks, trade names, or domain names, or prevent third parties
from acquiring and using trademarks, trade names, and domain names that infringe on, are similar to, or otherwise
decrease the value of our brands, trademarks, or service marks.
The registered or unregistered trademarks or trade names that we own may be challenged, infringed, circumvented,
declared generic, lapsed or determined to be infringing on or dilutive of other marks. We may not be able to protect our
rights in these trademarks and trade names, which we need in order to build name recognition with potential consumers and
partners. In addition, third parties have filed, and may in the future file, for registration of trademarks similar or identical to
our trademarks, which, if obtained, may impede our ability to build brand identity and possibly lead to market confusion. 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. In addition, there could be potential trade name or trademark infringement claims brought by owners of
other registered trademarks or trademarks that incorporate variations of our registered or unregistered trademarks or trade
names. If we are unable to establish or protect our trademarks and trade names, or if we are unable to build name
recognition based on our trademarks and trade names, we may not be able to compete effectively, which could harm our
competitive position, business, financial condition, results of operations, and prospects.
We have registered domain names for our websites that we use in our business. If we lose the ability to use a domain
name, whether due to trademark claims, failure to renew the applicable registration, or any other cause, we may be forced to
market our solutions under a new domain name, which could cause us substantial harm, or to incur significant expense in
order to purchase rights to the domain name in question. In addition, our competitors and others could attempt to capitalize
on our brand recognition by using domain names similar to ours. Domain names similar to ours have been registered in the
United States and elsewhere. We may be unable to prevent third parties from acquiring and using domain names that
infringe on, are similar to, or otherwise decrease the value of our brands, trademarks, or service marks. Protecting and
enforcing our rights in our domain names may require litigation, which could result in substantial costs and diversion of
management’s attention.
ICANN (the Internet Corporation for Assigned Names and Numbers), the international authority over top-level domain
names, has been increasing the number of generic top-level domains (“TLDs”). This may allow companies or individuals to
create new web addresses that appear to the right of the “dot” in a web address, beyond such long-standing TLDs as
“.com,” “.org” and “.gov.” ICANN may also add additional TLDs in the future. As a result, we may be unable to maintain
exclusive rights to all potentially relevant or desirable domain names in the United States, which may harm our business.
Furthermore, attempts may be made by third parties to register our trademarks as new TLDs or as domain names within
new TLDs, and we may be required to enforce our rights against such registration attempts, which could result in significant
expense and the diversion of management’s attention.
If we are unable to protect the confidentiality of our trade secrets, our business and competitive position would be
harmed.
We rely heavily on trade secrets and confidentiality agreements to protect our unpatented know-how, technology, and
other proprietary information, including our technology platform, and to maintain our competitive position. With respect to our
technology platform, we consider trade secrets and know-how to be one of our primary sources of intellectual property.
However, trade secrets and know-how can be difficult to protect. We seek to protect these trade secrets and other
proprietary technology, in part, by entering into non-disclosure and confidentiality agreements with parties who have access
to them, such as our employees, corporate collaborators, outside contractors, consultants, advisors, and other third parties.
We also enter into confidentiality and invention or patent assignment agreements with our employees and consultants. The
confidentiality agreements are designed to protect our proprietary information and, in the case of agreements or clauses
containing invention assignment, to grant us ownership of technologies that are developed through a relationship with
employees or third parties. We cannot guarantee that we have entered into such agreements with each party that may have
or have had access to our trade secrets or proprietary information, including our technology and processes. Despite these
efforts, no assurance can be given that the confidentiality agreements we enter into will be effective in controlling access to
such proprietary information and trade secrets. The confidentiality agreements on which we rely to protect certain
technologies may be breached, may not be adequate to protect our confidential information, trade secrets and proprietary
technologies and may not provide an adequate remedy in the event of unauthorized use or disclosure of our confidential
information, trade secrets, or proprietary technology. Further, these agreements do not prevent our competitors or others
from independently developing the same or similar technologies and processes, which may allow them to provide a service
similar or superior to ours, which could harm our competitive position.
Enforcing a claim that a party illegally disclosed or misappropriated a trade secret is difficult, expensive, and time-
consuming, and the outcome is unpredictable. In addition, some courts inside and outside the United States are less willing
or unwilling to protect trade secrets. If any of our trade secrets were to be lawfully obtained or independently developed by a
competitor or other third party, we would have no right to prevent them from using that technology or information to compete
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with us. If any of our trade secrets were to be disclosed to or independently developed by a competitor or other third party, it
could harm our competitive position, business, financial condition, results of operations, and prospects.
Issued patents covering our offerings could be found invalid or unenforceable if challenged.
The issuance of a patent is not conclusive as to its inventorship, scope, validity, or enforceability. Some of our patents or
patent applications (including licensed patents) have been, are being or may be challenged at a future point in time in
opposition, derivation, reexamination, inter partes review (“IPR”), post-grant review, or interference. Any successful third-
party challenge to our patents in this or any other proceeding could result in the unenforceability or invalidity of such patents,
which may lead to increased competition to our business, which could harm our business. 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.
We utilize open source software, which may pose particular risks to our proprietary software and solutions.
We use open source software in our solutions and will use open source software in the future. Companies that
incorporate open source software into their solutions have, from time to time, faced claims challenging the use of open
source software and compliance with open source license terms. Some licenses governing the use of open source software
contain requirements that we make available source code for modifications or derivative works we create based upon the
open source software, and that we license such modifications or derivative works under the terms of a particular open
source license or other license granting third parties certain rights of further use. By the terms of certain open source
licenses, we could be required to release the source code of our proprietary software, and to make our proprietary software
available under open source licenses to third parties at no cost, if we combine our proprietary software with open source
software in certain manners. Although we monitor our use of open source software, we cannot assure you that all open
source software is reviewed prior to use in our solutions, that our developers have not incorporated open source software
into our solutions, or that they will not do so in the future. Additionally, the terms of many open source licenses to which we
are subject have not been interpreted by U.S. or foreign courts. There is a risk that open source software licenses could be
construed in a manner that imposes unanticipated conditions or restrictions on our ability to market or provide our solutions.
Companies that incorporate open source software into their products have, in the past, faced claims seeking enforcement of
open source license provisions and claims asserting ownership of open source software incorporated into their product. If an
author or other third party that distributes such open source software were to allege that we had not complied with the
conditions of an open source license, we could incur significant legal costs defending ourselves against such allegations. In
the event such claims were successful, we could be subject to significant damages or be enjoined from the distribution of
our software. In addition, the terms of open source software licenses may require us to provide software that we develop
using such open source software to others on unfavorable license terms. As a result of our current or future use of open
source software, we may face claims or litigation, be required to release our proprietary source code, pay damages for
breach of contract, re-engineer our solutions, discontinue making our solutions available in the event re-engineering cannot
be accomplished on a timely basis or take other remedial action. Any such re-engineering or other remedial efforts could
require significant additional research and development resources, and we may not be able to successfully complete any
such re-engineering or other remedial efforts. Further, in addition to risks related to license requirements, use of certain open
source software can lead to greater risks than use of third-party commercial software, as open source licensors generally do
not provide warranties or controls on the origin of software. Any of these risks could be difficult to eliminate or manage, and,
if not addressed, could have a negative effect on our business, financial condition, and results of operations.
If we fail to comply with our obligations under license or technology agreements with third parties, we may be
required to pay damages and we could lose license rights that are critical to our business.
We license certain intellectual property, including technologies and software from third parties, that is important to our
business, and in the future we may enter into additional agreements that provide us with licenses to valuable intellectual
property or technology. If we fail to comply with any of the obligations under our license agreements, we may be required to
pay damages and the licensor may have the right to terminate the license. Termination by the licensor would cause us to
lose valuable rights, and could prevent us from selling our solutions and services, or adversely impact our ability to
commercialize future solutions and services. Our business would suffer if any current or future licenses terminate, if the
licensors fail to abide by the terms of the license, if the licensors fail to enforce licensed patents against infringing third
parties, if the licensed intellectual property are found to be invalid or unenforceable, or if we are unable to enter into
necessary licenses on acceptable terms. In addition, our rights to certain technologies are licensed to us on a non-exclusive
basis. The owners of these non-exclusively licensed technologies are therefore free to license them to third parties, including
our competitors, on terms that may be superior to those offered to us, which could place us at a competitive disadvantage.
Moreover, our licensors may own or control intellectual property that has not been licensed to us and, as a result, we may be
subject to claims, regardless of their merit, that we are infringing or otherwise violating the licensor’s rights. In addition, the
agreements under which we license intellectual property or technology from third parties are generally complex, and certain
provisions in such agreements may be susceptible to multiple interpretations. The resolution of any contract interpretation
disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property
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or technology, or increase what we believe to be our financial or other obligations under the relevant agreement. Any of the
foregoing could harm our competitive position, business, financial condition, results of operations, and prospects.
Risks Related to the Healthcare Industry
We may be subject to state and federal fraud and abuse and other healthcare regulatory laws and regulations. If we
or our commercial partners act in a manner that violates such laws or otherwise engage in misconduct, we may be
subject to civil or criminal penalties as well as exclusion from government healthcare programs .
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. 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 providers, 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. A person or
entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have
committed a violation;
• the U.S. federal physician self-referral law, or the Stark Law, which, subject to limited exceptions, prohibits
physicians from referring Medicare or Medicaid patients to an entity for the provision of certain designated
health services, or DHS, which includes outpatient prescription drugs, if the physician or a member of such
physician’s immediate family has a direct or indirect financial relationship (including an ownership interest or a
compensation arrangement) with the entity, and prohibits the entity from billing Medicare or Medicaid for such
DHS. Unlike the federal Anti-Kickback Statute, the Stark Law is violated if the financial arrangement does not
meet an applicable exception, regardless of any intent by the parties to induce or reward referrals or the
reasons for the financial relationship and the referral;
• the U.S. federal false claims laws, including the civil False Claims Act (which can be enforced through “qui
tam,” or whistleblower actions, by private citizens on behalf of the federal government), which prohibits any
person from, among other things, knowingly presenting, or causing to be presented false or fraudulent claims
for payment of government funds or knowingly making, using or causing to be made or used, a false record or
statement material to an obligation to pay money to the government or knowingly and improperly avoiding,
decreasing or concealing an obligation to pay money to the U.S. federal government. In addition, the
government may assert that a claim including items and services resulting from a violation of the U.S. federal
Anti-Kickback Statute or Stark Law constitutes a false or fraudulent claim for purposes of the civil False Claims
Act;
• HIPAA, which imposes criminal and civil liability for, among other things, knowingly and willfully executing, or
attempting to execute, a scheme to defraud any healthcare benefit program, or knowingly and willfully
falsifying, concealing or covering up a material fact or making any materially false statement, in connection
with the delivery of, or payment for healthcare benefits, items or services by a healthcare benefit program,
which includes both government and privately funded benefits programs. Similar to the U.S. federal Anti-
Kickback Statute, a person or entity does not need to have actual knowledge of the statute or specific intent to
violate it in order to have committed a violation;
• the federal Civil Monetary Penalties Law, which, subject to certain exceptions, prohibits, among other things,
the offer or transfer of remuneration, including waivers of copayments and deductible amounts (or any part
thereof), to a Medicare or state healthcare program beneficiary if the person knows or should know it is likely to
influence the beneficiary’s selection of a particular provider, practitioner or supplier of services reimbursable by
a state or federal healthcare program;
• federal consumer protection and unfair competition laws, which broadly regulate platform activities and
activities that potentially harm consumers; and
• state laws and regulations, including state anti-kickback, self-referral and false claims laws, that may apply to
our business practices, including but not limited to, research, distribution, sales and marketing arrangements
and claims involving healthcare items or services reimbursed by any third-party payor, including private
insurers and self-pay patients.
To enforce compliance with healthcare regulatory laws, certain enforcement bodies have recently increased their
scrutiny of interactions between healthcare companies and referral sources, which has led to a number of investigations,
prosecutions, convictions and settlements in the healthcare industry. Responding to investigations can be time- and
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resource-consuming and can divert management’s attention from the business. Additionally, as a result of these
investigations, entities may also have to agree to additional compliance and reporting requirements as part of a consent
decree, non-prosecution or corporate integrity agreement. Any such investigation or settlements could increase our costs or
otherwise have an adverse effect on our business. Even an unsuccessful challenge or investigation into our practices could
cause adverse publicity and be costly to respond.
The shifting commercial compliance environment and the need to build and maintain robust and expandable systems to
comply with different compliance or reporting requirements in multiple jurisdictions increase the possibility that a healthcare
company may fail to comply fully with one or more of these requirements. Efforts to ensure that our business arrangements
with third parties will comply with applicable healthcare laws and regulations may involve substantial costs. It is possible that
governmental authorities may conclude that our business practices, including, without limitation, our revenue sharing
arrangements with our partners, arrangements with entities that provide us with rebate administrative services, and other
sales and marketing practices, do not comply with applicable fraud and abuse or other healthcare laws and regulations or
guidance.
If our operations are found to be in violation of any of these laws or any other governmental regulations that may apply
to us, we may be subject to significant civil, criminal and administrative penalties, damages, fines, imprisonment, exclusion
from government-funded healthcare programs, such as Medicare and Medicaid, and additional oversight and reporting
requirements if we become subject to a corporate integrity agreement to resolve allegations of non-compliance with these
laws and the curtailment or restructuring of our operations. If any of the pharmacies, PBMs, pharma manufacturers,
marketing partners, or other entities with whom we do business is found not to be in compliance with applicable laws, they
may be subject to the same criminal, civil, or administrative sanctions, including exclusion from government-funded
healthcare programs.
We provide pricing information and discounted prices for all medications approved by the Food and Drug Administration
("FDA"), including products that are regulated under federal and state law as controlled substances. Controlled substances
are subject to more onerous regulatory requirements than other pharmaceutical products and have received increasing legal
scrutiny in recent years, which will likely continue into the future. Regulatory or legal developments that have the effect of
lowering the sales of controlled substances may have a negative impact on our business.
Our telehealth related products and services are subject to various state laws and regulations governing the
provision of telehealth services .
Our ability to provide our telehealth related products and services is primarily regulated at the state level. State laws and
regulations address, among other things, provider licensure requirements, the minimum modality required to provide
telehealth services (i.e., the minimum interaction required between a telehealth provider and patient), the types of healthcare
services that may be provided via telehealth, the types of practitioners that may provide such services, patient consent
requirements, and specific rules applicable to prescribing medications. These state laws and regulations are subject to
changing political, regulatory, and other influences. Some state licensing boards have established rules or interpreted
existing rules in a manner that limits or restricts our ability to conduct or optimize our business.
Our telehealth related products and services grant patients the ability to access our affiliated physician-owned
professional entities' network of clinicians to see a licensed healthcare provider for advice, diagnosis, and treatment of
routine health conditions on a remote basis. Due to the nature of these products and services and the provision of medical
care and treatment by a licensed healthcare professional, we, our affiliated professional entities and any affiliated healthcare
providers are and may in the future be subject to complaints, inquiries, and compliance orders by national and state
licensing boards. Such complaints, inquiries, or compliance orders may result in disciplinary actions taken by these licensing
boards against the licensed healthcare provider who provides services through our telehealth related products and services,
which could include suspension, restriction, or revocation of the healthcare provider’s license, probation, required continuing
education courses, monetary fines, administrative actions. and other conditions. Regardless of outcome, these complaints,
inquiries, or compliance orders could have an adverse impact on our telehealth related products and services and our
platform generally due to defense and settlement costs, diversion of management resources, negative publicity, reputational
harm, and other factors.
Due to the uncertain regulatory environment, certain states may determine that we or our affiliated professional entities
are in violation of their laws and regulations or such laws and regulations may change requiring that we modify the way we
currently conduct business. In the event that we must remedy such violations, we may be required to modify our products
and services in such states in a manner that undermines our products and services or business, we may become subject to
fines or other penalties or, if we determine that the requirements to operate in compliance in such states are overly
burdensome, we may elect to terminate our operations in such states. In each case, our business, financial condition, and
results of operations could be materially adversely affected.
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Our telehealth related products and services and relationships with our affiliated physician-owned professional
entities may implicate laws governing the practice of medicine and fee-splitting .
Our telehealth related products and services (where telehealth services are rendered by healthcare providers employed
by or contracted with our affiliated professional entities, including through staffing providers, such as Wheel) may implicate
certain state laws in the United States that generally prohibit non-physician entities from practicing medicine, exercising
control over physicians or engaging in certain practices such as fee-splitting with physicians. Although we believe that we
have structured our arrangements to ensure that the healthcare professionals maintain exclusive authority regarding the
delivery of medical care and prescription of medications when clinically appropriate, there can be no assurance that these
laws will be interpreted in a manner consistent with our practices or that other laws or regulations will not be enacted in the
future that could have a material and adverse effect on our business, financial condition, and results of operations.
Regulatory authorities, state licensing boards, state attorneys general, and other parties, including our affiliated professional
entities, may assert that, despite the management service agreement and other arrangements through which we operate,
we are engaged in the prohibited corporate practice of medicine, and/or that our arrangements with our affiliated
professional entities constitute unlawful fee-splitting. If a state’s prohibition on the corporate practice of medicine or fee-
splitting law is interpreted in a manner that is inconsistent with our practices, we would be required to restructure or
terminate our relationship with our affiliated professional entities to bring its activities into compliance with such laws. 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. 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.
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. The healthcare industry is subject to changing political, regulatory and other influences. The ACA, enacted in 2010,
made major changes in how healthcare is delivered and reimbursed, and increased access to health insurance benefits to
the uninsured and underinsured population of the United States. The ACA, among other things, increased the number of
individuals with Medicaid and private insurance coverage, implemented reimbursement policies that tie payment to quality,
facilitated the creation of accountable care organizations that may use capitation and other alternative payment
methodologies, strengthened enforcement of fraud and abuse laws and encouraged the use of information technology.
New and changing laws, regulations, executive orders, and other governmental actions, particularly from the Trump
administration, may also create uncertainty about how laws and regulations will be interpreted and applied. Such changes
can adversely affect our business by increasing our costs, reducing spending by our customers, limiting the Company’s
ability to pursue or offer new offerings, and requiring changes to our business. Regulatory changes and other actions that
materially adversely affect our business may be announced with little or no advance notice and we may not be able to
effectively mitigate all adverse impacts from such measures. Differing interpretations of such legal obligations can expose us
to significant fines, government investigations, litigation, and reputational harm. If we are found to have violated laws,
regulations, or executive orders, it could materially adversely affect our business, reputation, results of operations, and
financial condition.
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. For example, the Inflation Reduction Act (the “IRA”) was enacted in 2022. This statute
marks the most significant action by Congress with respect to the pharmaceutical industry since adoption of the ACA in
2010. 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 became due in 2023), redesigns the Medicare Part D benefit (beginning in 2024),
and replaces the Part D coverage gap discount program with a new discounting program (which began on January 1, 2025).
The IRA permits the HHS to implement many of these provisions through guidance, as opposed to regulation, for the initial
years. CMS published the negotiated prices for the initial ten drugs, which went into effect in 2026, and for the subsequent
15 drugs, which will first be effective in 2027, as well as the next set of 15 drugs that will be subject to price negotiations .
Each year thereafter, more Part B and Part D products will become subject to the HHS price negotiation program. HHS has
issued and is expected to continue to issue guidance implementing the IRA, although the negotiation program is currently
subject to legal challenges. In addition, the IRA delayed the final rule removing safe harbor protection for price reductions
given by pharmaceutical manufacturers to plan sponsors under Part D, either directly or through PBMs, unless the price
reduction is required by law, until 2032. While the impact of the IRA on us and the pharmaceutical industry cannot yet be
fully determined, it is likely to be significant.
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In July 2025, the OBBBA was enacted, which imposes significant reductions in the funding of the Medicaid program and
restrictions for certain groups to access the ACA Marketplace. These changes are expected to decrease the number of
persons enrolled in Medicaid and reduce the services covered by Medicaid, and may result in an increase in the number of
individuals who are unable to access health insurance benefits and medical care, which could adversely affect their ability to
receive prescriptions and certain prescribed medications. The impact of the OBBBA on our business and the pharmaceutical
industry cannot yet be fully determined, but is likely to be significant.
M ore recently, the current presidential administration has proposed significant tariffs on pharmaceutical manufacturers
that do not adopt pricing policies such as most favored nation pricing, which would tie the price for drugs in the U.S. to the
lowest price in a group of other countries. In response, multiple manufacturers have entered into confidential pricing
agreements with the federal government, and as part of these agreements, have announced their participation in a new
government sponsored direct-to-consumer platform, TrumpRx, which was launched in February 2026 and designed to offer
consumers discounts on their products and some specialty brands. A ny potential positive or negative impact on our
business, offerings or results of operations, are unclear at this time but may be significan t . On the other hand, the Trump
administration is pursuing traditional regulatory pathways to impose drug pricing policies and published two proposed
regulations in December 2025, referred to as Globe and Guard. If finalized, these regulations would implement mandatory
payment models under which manufacturers of eligible drugs would be required to pay rebates to the federal government on
a portion of the units of their drugs that are reimbursed by Medicare, with the rebate amount based on Most-Favored-Nation
pricing. While the impact of the Globe and Guard proposed regulations, if finalized, cannot yet be determined, it is likely to
be significant. Even regulatory proposals or executive actions that are ultimately deemed unlawful could negatively impact
the U.S. pharmaceutical sector and our business.
Our ability to realize the benefits of opportunities that we elect to pursue, such as initiatives related to TrumpRx, may be
limited, and we may be unable to fully achieve related business goals. At the same time, ongoing changes and shifts in
healthcare policy, or changes in applicable legal standards, may reduce or even eliminate these opportunitie s. As a result,
any returns on our investment in developing these opportunities are uncertain and the failure to achieve related business
goals may adversely affect our financial condition and results of operations.
Congress has and is likely to continue to scrutinize key participants in the healthcare industry, including PBMs. A
number of bills have been introduced in Congress that would further regulate PBMs and impose additional requirements.
The FTC has issued statements about PBMs and conducted a study of PBMs that resulted in two published reports, which
could motivate further actions by Congress with respect to PBM regulation. Any findings in the report may motivate further
actions by Congress with respect to PBM regulation. In September 2024, the FTC filed an administrative complaint against
the three largest PBMs and their affiliated group purchasing organizations alleging that the PBMs engaged in anti-
competitive and unfair practices that increased costs for insulin medication. As part of a proposed settlement in one of these
actions, the PBM has agreed to fundamental changes in its business practices. It is unclear what the results of the remaining
matters will be, and what impact the announced settlement and the outcome of the remaining matters will have on the PBM
industry and our business, financial condition, and results of operations. See 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
offerings, for prescription medications dispensed by pharmacies, and, in some cases, designed to encourage importation
from other countries and bulk purchasing. Some states have enacted legislation creating so-called prescription drug
affordability boards, and at least one state is using its board to impose price limits on certain drugs in the state. In addition,
the Supreme Court held in December 2020 in Rutledge v. Pharmaceutical Care Management that ERISA, a federal statute,
did not preempt an Arkansas state law that regulates PBM reimbursements to network pharmacies and other standards for
PBMs’ reimbursements to network pharmacies. As a result of this holding, some states have passed, and other states may
pass similar legislation or may otherwise attempt to regulate PBMs, which could have impacts on the healthcare industry.
Further, we may see heightened regulatory scrutiny from state regulators related to our integrated savings programs,
particularly with respect to insurance laws. These regulatory requirements and related scrutiny may impose timing and
expense constraints on us or our industry partners that could adversely affect our partnerships or our operations.
Our offerings also provide consumers access to compounded injectable semaglutide, a glucagon-like peptide-1 receptor
agonist ("GLP-1"). GLP-1s are subject to elevated consumer demand, foreign, federal and state-specific regulatory
limitations, limited manufacturing capacity and potential supply chain disruptions, all of which could affect our ability to
provide continuing access to such GLP-1s. Increasing consumer demand could further increase prices and/or constrain
supply. The evolving regulatory landscape has also impacted our ability to continue offering access to such products. For
example, in the United States, all doses of semaglutide branded under Ozempic and Wegovy became listed as available on
the FDA’s shortage list as of October 30, 2024. On February 21, 2025, the FDA resolved the semaglutide shortage, and on
May 22, 2025, the FDA’s period of enforcement discretion following resolution of the shortage concluded with respect to
503B outsourcing facilities. Resolution of the shortage has constrained and is expected to continue to constrain our ability to
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continue providing access to compounded semaglutide on our platform. The regulatory landscape applicable to GLP-1s
continues to rapidly evolve. If regulatory or market conditions change, or we are unable to meet our customers’ demand for
our offerings, or if they do not otherwise meet customer expectations, our brand, reputation and results of operations could
be adversely affected.
We expect that additional state and federal healthcare reform measures will be adopted in the future, any of which could
impact the amounts that federal and state governments and other third-party payors will pay for healthcare products and
services or require us to restructure our existing arrangements with PBMs and pharma manufacturers, any of which could
adversely affect our business, financial condition, and results of operations.
Risks Related to Our Organizational Structure, including Agreements and Relationships with Significant Stockholders
Our capital structure may adversely affect the trading market for our Class A common stock.
We cannot predict whether our dual class or controlled company structure will result in a lower or more volatile market
price of our Class A common stock or in adverse publicity or other adverse consequences. For example, FTSE Russell
requires new constituents of its indices to have greater than 5% of the company's voting rights in the hands of public
stockholders. In addition, certain index providers previously imposed restrictions on including companies with dual class or
multi-class share structures in certain of their indexes and such restrictions could be reimposed in the future. As a result, our
dual class capital structure makes us ineligible for inclusion in certain indices, and mutual funds, exchange-traded funds and
other investment vehicles that attempt to passively track these indices may not invest in our stock. It is possible that such
policies may depress our valuation compared to those of other similar companies that are included. These policies could
make our Class A common stock less attractive to investors and, as a result, the market price of our Class A common stock
could be adversely affected.
The parties to our stockholders agreement, who hold a significant portion of our Class B common stock, control
the direction of our business and such parties’ ownership of our common stock prevents you and other
stockholders from influencing significant decisions.
As of December 31, 2025 , 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 95.6% 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. Moreover, the parties to our stockholders agreement, who also hold Class A and Class B common
stock, own approximately 93.8% of the combined voting power of our Class A and Class B common stock as of
December 31, 2025 . In addition, we have agreed to nominate to our Board individuals designated by Silver Lake, Francisco
Partners, and Idea Men, LLC in accordance with our stockholders agreement. Silver Lake, Francisco Partners, and Idea
Men, LLC each retain the right to designate directors for so long as they beneficially own at least 5% of the aggregate
number of shares of common stock outstanding. Even when the parties to our stockholders agreement cease to own shares
of our stock representing a majority of the total voting power, for so long as the parties to our stockholders agreement
continue to own a significant percentage of our stock, particularly our Class B common stock, they will still be able to
significantly influence or effectively control the composition of our Board and the approval of actions requiring stockholder
approval through their voting power. Accordingly, for such period of time, the parties to our stockholders agreement will have
significant influence with respect to our management, business plans, and policies. In particular, for so long as the parties to
our stockholders agreement continue to own a significant percentage of our stock, particularly our Class B common stock,
the parties to our stockholders agreement may be able to cause or prevent a change of control of our company or a change
in the composition of our Board, and could preclude any unsolicited acquisition of our company. The concentration of
ownership could deprive investors of an opportunity to receive a premium for their shares of Class A common stock as part
of a sale of our company and ultimately might affect the market price of our Class A common stock.
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.
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.
As of December 31, 2025 , the parties to our stockholders agreement collectively own approximately 68.3% of our
outstanding shares of common stock. Subject to the restrictions described in the paragraph below, future sales of these
shares are subject to the volume and other restrictions of Rule 144 under the Securities Act for so long as such parties are
deemed to be our affiliates, unless the shares to be sold are registered with the SEC. These stockholders are entitled to
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rights with respect to the registration of their shares. We are unable to predict with certainty whether or when such parties
will sell a substantial number of shares of our Class A common stock. The sale by the parties to our stockholders agreement
of a substantial number of shares, or a perception that such sales could occur, could significantly reduce the market 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 .
We are, and may in the future become, subject to various legal proceedings and claims that arise in or outside the
ordinary course of business. The results of these legal proceedings cannot be predicted with certainty. 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. In addition, lawsuits and other legal proceedings may be time
consuming to defend or prosecute and may require a commitment of management and personnel resources that will be
diverted from our normal business operations. Our litigation and regulatory risk profiles could change as we continue to offer
new services and expand in business areas, and we may face increased legal and regulatory risks related to our integrated
savings program and evolving relationships with PBMs. For example, our integrated savings program may be subject to
additional regulations under various state insurance laws. Also, our insurance coverage may be insufficient, our assets may
be insufficient to cover any amounts that exceed our insurance coverage, and we may have to pay damage awards or
otherwise may enter into settlement arrangements in connection with such claims. Moreover, we may be unable to continue
to maintain our existing insurance at a reasonable cost, if at all, or to secure additional coverage, which may result in costs
associated with lawsuits and other legal proceedings being uninsured. Any such payments or settlement arrangements in
current or future litigation could have a material adverse effect on our business, operating results, or financial condition.
Even if the plaintiffs’ claims are not successful, current or future litigation could result in substantial costs and significantly
and adversely impact our reputation and divert management’s attention and resources, which could have a material adverse
effect on our business, operating results and financial condition, and negatively affect the price of our Class A common
stock. In addition, such lawsuits may make it more difficult to finance our operations. See Note 13 to our audited
consolidated financial statements included elsewhere in this Annual Report on Form 10-K for additional information.
We are a “controlled company” under the corporate governance rules of The Nasdaq Stock Market and, as a result,
qualify for, and rely on, exemptions from certain corporate governance requirements. You do not have the same
protections afforded to stockholders of companies that are subject to such requirements.
As of December 31, 2025 , certain affiliates of Silver Lake, Francisco Partners, and Idea Men, LLC own approximately
93.8% of the combined voting power of our Class A and Class B common stock and are parties, among others , to a
stockholders agreement. As a result, we are a “controlled company” within the meaning of the corporate governance
standards of The Nasdaq Stock Market rules. Under these rules, a listed company of which more than 50% of the voting
power is held by an individual, group, or another company is a “controlled company” and may elect not to comply with
certain corporate governance requirements, including:
• the requirement that a majority of its board of directors consist of independent directors;
• the requirement that its director nominations be made, or recommended to the full board of directors, by its
independent directors or by a nominations committee that is comprised entirely of independent directors and
that it adopt a written charter or board resolution addressing the nominations process; and
• the requirement that it have a compensation committee that is composed entirely of independent directors with
a written charter addressing the committee’s purpose and responsibilities.
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 a result of any
such election, our Board would not have a majority of independent directors, our compensation committee would not consist
entirely of independent directors and our directors would not be nominated or selected by independent directors, as
applicable. Accordingly, investors do not have the same protections afforded to stockholders of companies that are subject
to all of the corporate governance requirements of The Nasdaq Stock Market rules.
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Delaware law and provisions in our amended and restated certificate of incorporation and amended and restated
bylaws could make a merger, tender offer or proxy contest more difficult, limit attempts by our stockholders to
replace or remove our current management and limit the market price of our Class A common stock.
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,
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.
In addition, we have opted out of Section 203 of the Delaware General Corporation Law, but our amended and restated
certificate of incorporation provides that engaging in any of a broad range of business combinations with any “interested
stockholder” (any entity or person who, together with that entity’s or person’s affiliates and associates, owns or within the
previous three years owned, 15% or more of our outstanding voting stock) for a period of three years following the date on
which the stockholder became an “interested stockholder” is prohibited, provided, however, that, under our amended and
restated certificate of incorporation, the parties to our stockholders agreement and any of their respective affiliates are not
deemed to be interested stockholders regardless of the percentage of our outstanding voting stock owned by them, and
accordingly are not subject to such restrictions.
These provisions, alone or together, could discourage, delay, or prevent a transaction involving a change in control of
our company. These provisions could also discourage proxy contests and make it more difficult for stockholders to elect
directors of their choosing and to cause us to take other corporate actions they desire, any of which, under certain
circumstances, could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common
stock, and could also affect the price that some investors are willing to pay for our Class A common stock.
Our amended and restated certificate of incorporation provides that the doctrine of “corporate opportunity” does
not apply with respect to certain parties to our stockholders agreement and any director or stockholder who is not
employed by us or our subsidiaries.
The doctrine of corporate opportunity generally provides that a corporate fiduciary may not develop an opportunity using
corporate resources, acquire an interest adverse to that of the corporation or acquire property that is reasonably incident to
the present or prospective business of the corporation or in which the corporation has a present or expectancy interest,
unless that opportunity is first presented to the corporation and the corporation chooses not to pursue that opportunity. The
doctrine of corporate opportunity is intended to preclude officers or directors or other fiduciaries from personally benefiting
from opportunities that belong to the corporation. Our amended and restated certificate of incorporation, provides that the
doctrine of “corporate opportunity” does 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. SLP Geology Aggregator, L.P.,
Francisco Partners IV, L.P., Francisco Partners IV-A, 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
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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. As a result, certain of our stockholders, directors, and
their respective affiliates are not prohibited from operating or investing in competing businesses. We, therefore, may find
ourselves in competition with certain of our stockholders, directors, or their respective affiliates, and we may not have
knowledge of, or be able to pursue, transactions that could potentially be beneficial to us. Accordingly, we may lose a
corporate opportunity or suffer competitive harm, which could negatively impact our business, operating results, and
financial condition.
Our amended and restated certificate of incorporation provides that the Court of Chancery of the State of Delaware
is the sole and exclusive forum for certain stockholder litigation matters and the federal district courts of the United
States is the exclusive forum for the resolution of any complaint asserting a cause of action arising under the
Securities Act, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us
or our directors, officers, employees, or stockholders.
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. Notwithstanding the foregoing, the exclusive forum
provision shall not apply to claims seeking to enforce any liability or duty created by the Exchange Act. The choice of forum
provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our
directors, officers or other employees, which may discourage such lawsuits against us and our directors, officers, and other
employees, although our stockholders will not be deemed to have waived our compliance with federal securities laws and
the rules and regulations thereunder. Alternatively, if a court were to find the choice of forum provision contained in our
amended and restated certificate of incorporation to be inapplicable or unenforceable in an action, we may incur additional
costs associated with resolving such action in other jurisdictions, which could harm our business, results of operations, and
financial condition. Any person or entity purchasing or otherwise acquiring or holding any interest in shares of our capital
stock shall be deemed to have notice of and consented to the forum provisions in our amended and restated certificate of
incorporation.
We do not intend to pay dividends for the foreseeable future.
We currently intend to retain any future earnings to finance the operation and expansion of our business and we do not
expect to declare or pay any dividends in the foreseeable future. Moreover, the terms of our existing debt agreements
restrict our ability to pay dividends, and any additional debt we may incur in the future may include similar restrictions. In
addition, Delaware law may impose requirements that may restrict our ability to pay dividends to holders of our common
stock. As a result, stockholders must rely on sales of their Class A common stock after price appreciation as the only way to
realize any future gains on their investment.
We are a holding company and depend on our subsidiaries for cash to fund operations and expenses, including
future dividend payments, if any.
We are a holding company that does not conduct any business operations of our own. As a result, we are largely
dependent upon cash distributions and other transfers from our subsidiaries to meet our obligations and to make future
dividend payments, if any. We do not currently expect to declare or pay dividends on our common stock for the foreseeable
future; however, the agreements governing the indebtedness of our subsidiaries impose restrictions on our subsidiaries’
ability to pay dividends or other distributions to us. The deterioration of the earnings from, or other available assets of, our
subsidiaries for any reason could impair their ability to make distributions to us.
General Risk Factors
We may be unable to accurately forecast revenue and appropriately plan our expenses in the future.
We base our current and future expense levels on our operating forecasts and estimates of future income. Income and
results of operations are difficult to forecast because they generally depend on the number and timing of our consumers
using our platform, signing up for a subscription or using the services provided by our telehealth platform, as well as pharma
manufacturers' spending patterns, which are uncertain. Additionally, our business is affected by general economic and
business conditions around the world. A softening in income, whether caused by changes in consumer preferences, the
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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. This inability could result in lower net income or greater net loss in a given quarter than expected.
We may experience fluctuations in our tax obligations and effective income tax rate, which could materially and
adversely affect our results of operations.
We are subject to U.S. federal and state income taxes. Tax laws, regulations, and administrative practices in various
jurisdictions may be subject to significant change, with or without advance notice, due to economic, political, and other
conditions, and significant judgment is required in evaluating and estimating our provision and accruals for these taxes.
There are many transactions that occur during the ordinary course of business for which the ultimate tax determination is
uncertain. Our effective income tax rates could be affected by numerous factors, such as changes in tax, accounting, and
other laws, regulations, administrative practices, principles and interpretations, the mix and level of earnings in a given
taxing jurisdiction or our ownership or capital structures. For example, the IRA, enacted in August 2022, imposes a minimum
tax on certain corporations with book income of at least $1 billion (subject to certain adjustments) and an excise tax on
certain stock buybacks and similar corporate actions.
We may need additional capital in the future, which may not be available to us on favorable terms, or at all, and may
dilute your ownership of our Class A common stock.
We intend to continue to make investments to support our business growth and may require additional capital to fund
and support our business, to respond to competitive challenges or take advantage of strategic opportunities. Accordingly, we
may require additional capital from equity or debt financing in the future and may not be able to secure timely additional
financing on favorable terms, or at all. The terms of any additional financing may place limits on our financial and operating
flexibility, including our ability to issue or repurchase equity, develop new or enhanced existing offerings, complete
acquisitions or otherwise take advantage of business opportunities. If we raise additional funds or finance acquisitions
through further issuances of equity, convertible debt securities or other securities convertible into equity, you and our other
stockholders could suffer significant dilution in your percentage ownership of our company, and any new securities we issue
could have rights, preferences and privileges senior to those of holders of our Class A common stock. If we raise additional
funds through debt financing, such financing could impose restrictive covenants relating to our capital-raising activities and
other financial and operational matters, which may make it more difficult for us to obtain additional capital or to pursue
business opportunities, including potential acquisitions. If we are unable to obtain adequate financing or financing on terms
satisfactory to us, if and when we require it, including as a result of the disruption to the capital and debt markets caused by
COVID-19 or a pandemic of a similar infectious disease, our ability to grow or support our business and to respond to
business challenges could be significantly limited.
Changes in U.S. patent law could diminish the value of patents in general, thereby impairing our ability to protect
our platform or features of our platform and offerings.
There are a number of changes to the patent laws that may have a significant impact on our ability to protect our
technology and enforce our intellectual property rights. For example, the Leahy-Smith America Invents Act (the “AIA”),
enacted in September 2011, resulted in significant changes in patent legislation. An important change introduced by the AIA
is that, as of March 16, 2013, the United States transitioned from a “first-to-invent” to a “first-to-file” system for deciding
which party should be granted a patent when two or more patent applications are filed by different parties claiming the same
invention. Under a “first-to-file” system, assuming the other requirements for patentability are met, the first inventor to file a
patent application generally will be entitled to a patent on the invention regardless of whether another inventor had made the
invention earlier. A third party that files a patent application in the U.S. Patent and Trademark Office (“USPTO”) after that
date but before us could therefore be awarded a patent covering an invention of ours even if we made the invention before it
was made by the third party. Circumstances could prevent us from promptly filing patent applications on our inventions. The
AIA also includes a number of significant changes that affect the way patent applications will be prosecuted and also may
affect patent litigation. These include allowing third party submission of prior art to the USPTO during patent prosecution and
additional procedures to attack the validity of a patent by USPTO administered post-grant proceedings, including post-grant
review, IPR, and derivation proceedings.
There are also a number of changes to the patent laws being considered that, if enacted, may have a significant impact
on our ability to protect our technology and enforce our intellectual property rights. For example, the Senate Judiciary
Committee’s Subcommittee on Intellectual Property in 2025 held hearings on modifying the test for patent eligibility under
Section 101 of the Patent Act to limit the ability to challenge claims for being abstract. Such changes could initially result in
an increased value for issued patents, but depending on how the legislation is enacted, may adversely impact other issued
patents which properly satisfied the patent eligibility test as of the time of examination, but might fail the new test depending
on what is enacted. Alternatively, the USPTO could decide to strengthen its examination under Section 101, leading to fewer
issuing patents or patents issuing with more limited scope. Similarly, several years ago, Congress considered expanding the
test for patent definiteness under Section 112(f) of the Patent Act in a way that could result in a diminished value for issued
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patents. While proposed changes to that law were not enacted, Congress could consider reintroducing these proposed
changes in connection with its current exploration into amending the Section 101 law.
There also have been legislative discussions regarding the changing of rules relating to post-grant review of patents
through IPR or covered business method (“CBM”) review. For example, current case law holds that the Patent Trial and
Appeal Board (“PTAB”) has the sole authority to determine whether to institute an IPR or CBM, and such decision is
unreviewable on appeal. Efforts to amend the law to allow appellate review of PTAB institution decisions could result in an
increase of institution as a result of such appellate review, and a corresponding increase in invalidation through these
processes. Because of a lower evidentiary standard in PTAB proceedings compared to the evidentiary standard in U.S.
federal courts necessary to invalidate a patent claim, a third party could potentially provide evidence in a PTAB proceeding
sufficient for the PTAB to hold a claim invalid even though the same evidence would be insufficient to invalidate the claim if
first presented in a district court action. Accordingly, a third party may attempt to use the PTAB procedures to invalidate our
patent claims that would not have been invalidated if first challenged by the third party as a defendant in a district court
action, and legislative attempts to make it easier to appeal successful patent-holder results could diminish the value of
patents. Further, the Trump Administration has been issuing rules to try to make it more difficult to challenge patents through
the IPR process at the PTAB. While this would improve our rights as a patent holder, it would make it more difficult to
challenge patents of others if we were to decide to do so.
In addition, the patent position of companies engaged in the development and commercialization of software and
internet e-commerce is particularly uncertain. Various courts, including the Supreme Court have rendered decisions that
affect the scope of patentability of certain inventions or discoveries relating to certain software and business method patents.
These decisions state, among other things, that a patent claim that recites an abstract idea, natural phenomenon or law of
nature is not itself patentable. Precisely what constitutes a law of nature or abstract idea is uncertain, and it is possible that
certain aspects of our software or business methods would be considered abstract ideas. Accordingly, the evolving case law
in the United States may adversely affect our ability to obtain patents and may facilitate third-party challenges to any owned
or licensed patents. The laws of some foreign countries do not protect intellectual property rights to the same extent as the
laws of the United States, and we may encounter difficulties in protecting and defending such rights in foreign jurisdictions.
The legal systems of many other countries do not favor the enforcement of patents and other intellectual property protection,
particularly those relating to software, which could make it difficult for us to stop the infringement of our patents in such
countries. Proceedings to enforce our patent rights in foreign jurisdictions could result in substantial cost and divert our
efforts and attention from other aspects of our business.
We may not be able to enforce our intellectual property rights throughout the world.
We may also be required to protect our proprietary technology and content in an increasing number of jurisdictions, a
process that is expensive and may not be successful, or which we may not pursue in every location. Filing, prosecuting,
maintaining, defending, and enforcing intellectual property rights on our solutions, services, and technologies in all countries
throughout the world would be prohibitively expensive, and our intellectual property rights in some countries outside the
United States can be less extensive than those in the United States. We do not own and have not registered or applied for
intellectual property outside the United States. Competitors may use our technologies in jurisdictions where we have not
obtained protection to develop their own solutions and services and, further, may export otherwise violating solutions and
services to territories where we have protection but enforcement is not as strong as that in the United States. These
solutions and services may compete with our solutions and services, and our intellectual property rights may not be effective
or sufficient to prevent them from competing. In addition, the laws of some foreign countries do not protect proprietary rights
to the same extent as the laws of the United States, and many companies have encountered significant challenges in
establishing and enforcing their proprietary rights outside of the United States. These challenges can be caused by the
absence or inconsistency of the application of rules and methods for the establishment and enforcement of intellectual
property rights outside of the United States. For instance, there is no uniform worldwide policy regarding patentable subject
matter or the scope of claims allowable for business methods. As such, we do not know the degree of future protection that
we will have on our technologies, products and services.
In addition, the legal systems of some countries, particularly developing countries, do not favor the enforcement of
intellectual property protection, especially those relating to healthcare. This could make it difficult for us to stop the
misappropriation or other violation of our other intellectual property rights. Accordingly, we may choose not to seek
protection in certain countries, and we will not have the benefit of protection in such countries. Proceedings to enforce our
intellectual property rights in foreign jurisdictions could result in substantial costs and divert our efforts and attention from
other aspects of our business. Accordingly, our efforts to protect our intellectual property rights in such countries may be
inadequate. In addition, changes in the law and legal decisions by courts in the United States and foreign countries may
affect our ability to obtain adequate protection for our solutions, services, and other technologies and the enforcement of
intellectual property. Any of the foregoing could harm our competitive position, business, financial condition, results of
operations, and prospects.
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We may be subject to claims that our employees, consultants, or advisors have wrongfully used or disclosed
alleged trade secrets of their current or former employers or claims asserting ownership of what we regard as our
own intellectual property.
Many of our employees, consultants, and advisors are currently or were previously employed at other companies in our
field, including our competitors or potential competitors. 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. Litigation may be necessary to defend against these claims. If we fail in
defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights or
personnel. Even if we are successful in defending against such claims, litigation could result in substantial costs and be a
distraction to management.
In addition, while it is our policy to require our employees and contractors who may be involved in the conception or
development of intellectual property to execute agreements assigning such intellectual property to us, we may be
unsuccessful in executing such an agreement with each party who, in fact, conceives or develops intellectual property that
we regard as our own. The assignment of intellectual property rights may not be self-executing, or the assignment
agreements may be breached, and we may be forced to bring claims against third parties, or defend claims that they may
bring against us, to determine the ownership of what we regard as our intellectual property. Any of the foregoing could harm
our competitive position, business, financial condition, results of operations, and prospects.
If we cannot license rights to use technologies on reasonable terms, we may not be able to commercialize new
solutions or services in the future.
In the future, we may identify additional third-party intellectual property we may need to license in order to engage in our
business, including to develop or commercialize new solutions or services. However, such licenses may not be available on
acceptable terms or at all. The licensing or acquisition of third-party intellectual property rights is a competitive area, and
several more established companies may pursue strategies to license or acquire third-party intellectual property rights that
we may consider attractive or necessary. These established companies may have a competitive advantage over us due to
their size, capital resources and greater development or commercialization capabilities. 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. Such royalties are a
component of the cost of our solutions or services and may affect the margins on our solutions and services. In addition,
such licenses may be non-exclusive, which could give our competitors access to the same intellectual property licensed to
us. If we are unable to enter into the necessary licenses on acceptable terms or at all, if any necessary licenses are
subsequently terminated, if our licensors fail to abide by the terms of the licenses, if our licensors fail to prevent infringement
by third parties, or if the licensed intellectual property rights are found to be invalid or unenforceable, our business, financial
condition, results of operations and prospects could be affected. If licenses to third-party intellectual property rights are or
become required for us to engage in our business, the rights may be non-exclusive, which could give our competitors
access to the same technology or intellectual property rights licensed to us. Moreover, we could encounter delays and other
obstacles in our attempt to develop alternatives. Defense of any lawsuit or failure to obtain any of these licenses on
favorable terms could prevent us from commercializing solutions and services, which could harm our competitive position,
business, financial condition, results of operations, and prospects.
Our stock price may be volatile or may decline regardless of our operating performance, resulting in substantial
losses for investors.
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;
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• 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, 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 prices of securities of
companies have experienced fluctuations that often have been unrelated or disproportionate to their results of operations.
Market fluctuations could result in extreme volatility in the price of shares of our Class A common stock, which could cause a
decline in the value of your investment. Price volatility may be greater if the public float and trading volume of shares of our
Class A common stock is low. Furthermore, in the past, stockholders have sometimes instituted securities class action
litigation against companies following periods of volatility in the market price of their securities. 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.
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