Optum Rx, the pharmacy services arm of UnitedHealth Group (NYSE:UNH), has launched a drug price comparison tool to allow its members to get the lowest prices for generic drugs.
Branded as Price Edge and available for all Optum Rx members, the tool compares the direct-to-consumer pricing for traditional generic drugs with insurance pricing.
“Price Edge ensures a competitive consumer price on generic drugs with every transaction,” the company said, adding it offers lower prescription drug prices for consumers nearly 90% of the time.
The Price Edge option has been activated for more than 1.5M of Optum Rx members, and the company plans to add another 400K members by Mar. 01.
GoodRx Holdings (GDRX), which offers tools and information to compare drug prices, traded lower after the announcement, which coincided with Amazon’s (AMZN) launch of the generic prescription service RxPass.
According to Citi analyst Daniel Grosslight, RxPass represents a “credible threat” to GoodRx (GDRX) for its polychronic consumers and will pressure the drugs savings platform’s gold membership.
“We think GoodRx will need to accelerate the pace of product innovation to fend off the AMZN threat,” the analyst wrote, maintaining the Buy rating and $7 per share target on the stock.
Seeking Alpha contributor Vader Capital considers GoodRx’s (GDRX) branding and wide network are its competitive advantages.