Safe Rx has locked down $2.65 million in its latest funding round.
The Greenwood Village-based startup, which makes prescription drug bottles with combination locks designed to curb opioid abuse, plans to use its newly raised capital to increase production and staff.
“The No. 1 source for teen prescription drug abuse, nationally and here in Colorado, is pilfering from our parents’ medicine cabinets,” said Safe Rx CEO Milton Cohen. “And it’s not going to stop anytime soon unless somebody does something about it. So, that’s what we’re trying to do here.”
Safe Rx’s patented pill bottle is sold to health systems, such as Vail Health Hospital, pharmacy retailers and treatment centers that fill prescriptions directly into their bottles. Patients can also buy the bottles themselves in Target, Walmart, or on Amazon, as well as the company’s website.
Cohen said the state of Ohio is also looking at funding a statewide dispensing pilot of the company’s locking bottle next year.
“This is important because opioid abuse that starts in the medicine cabinet imposes huge costs on the U.S. healthcare system, with the excess care cost of pilfering estimated at $3 billion annually,” he added. “Locking pill bottles have been proven effective in early dispensing studies and are a low-cost early intervention that can generate significant treatment cost savings for large employers, payers, and providers with high rates of uncompensated care.”
A single locking pill bottle retails for $10, and customers can purchase up to a 10-pack for $80.
The startup, which launched its product in 2018, has 14 full-time employees and contractors in its headquarters at 6295 Greenwood Plaza Blvd. Cohen said they have already used the funds to hire three new employees to help increase business with health systems and pharmacies.
“It’s unlucky and lucky at the same time, but just about every one of our employees has a personal story in relation to opioid addiction,” Cohen said. “No neighborhood has been left untouched by this pandemic.”
This round brings Safe Rx’s total raised to around $8.65 million, according to Cohen. Investors included several investment groups of ultra-high-net-worth families, as well as pharmacy and healthcare industry executives.
“Given our mission, we have folks that invest for one reason or another because of a personal story attached, and we want to respect their privacy,” Cohen said.
Sean Serell, a practicing physician and father of two, founded the company in 2017 after growing frustrated with the increasing opioid crisis. He spent “countless amounts of time and money in research, design engineering, testing, education and outreach” to develop a simple, cost-effective solution to unauthorized access to prescription pills, according to the company’s website.
While there aren’t many other locking pill bottles on the market, similar products include Safer Lock’s four-digit combination locking cap, which retails for $18, as well as a prescription lock box ranging from $20 to $50, depending on the dimensions. Apothecary Products also sells an Ezy Dose container locked by a key to put your pill bottle in for $13.
Safe Rx sales slowed down in 2020 due to store closures, the cancellation of promotional events and without the usual back-to-school momentum, Cohen said. But the startup is gearing up for the “second-order effects of the pandemic,” he added.
“By second-order effects what we mean is people are losing their jobs, their houses, their food security, and one of the highest priorities in public health after those is substance abuse,” Cohen said. “Substance abuse is up 30 to 50 percent what it was pre-pandemic, so most health systems and other providers are really starting to focus on that effect. We are a key solution, particularly for our young people that have been experiencing a big dislocation because of the lack of school over the past year.”
In the next 90 days, Safe Rx also plans to start selling its products to military bases around the U.S.
“There’s a higher rate of prescribing in the military, which leads to a higher incidence of substance abuse and addiction as a result,” Cohen said.
Outside of its product line, Safe Rx is also working on licensing its cap enclosure technology and intellectual property to other consumer product brands in broader categories, he said.
“For instance, every nine minutes, a kid goes to the E.R. in the U.S. for over-the-counter poisoning,” Cohen said. “And separately, every 36 minutes a child goes to the E.R. in the U.S. from detergent pod poisoning. So, we’re looking to license our IP into additional product categories beyond prescription bottles.”