While employee benefits have not yet proved to be a winning bet for employers, that isn’t preventing companies from creating new fangled benefits and cashing out.
Last week, Progyny, which provides fertility benefits to employees filed its intention to go public with the Securities & Exchange Commission. The New York company, founded in 2016, has created a fertility benefits program that includes access to pharmacy for treatments that may be required as well as a fertility expert it bills as a Patient Care Advocate.
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In its S-1 filing, the company said that Progyny began with five companies as clients using its fertility program. That number has now jumped to 80.
The company also claims that it has better outcomes — with more women and their partners fulfilling their desire to become pregnant and parents through their provider clinics — than the national average. It also claims to have lower-than-average miscarriage rates.
Per the regulatory filing, the company’s revenue was $48.6 million in 2017 and $105.4 million in 2018, respectively, representing a year-over-year growth of 117 percent. Progyny’s revenue was $48.4 million for the six-month period that ended on June 30, 2018, and $103.4 million for the same six-month period this year. That accounts for a growth of 113 percent.
However, the company is still in the red in terms of reporting profits in a 12-month period. In 2018, it reported net loss of $5.5 million although so far this year, if net income from continuing operations is the number to be reviewed, Progyny had a profit of $4 million. J.P. Morgan, Goldman Sachs and BofA Merrill Lynch are acting as joint lead book-running managers for the proposed IPO.
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A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
While Progyny is offering a specific benefit to employees, there are other platform solutions that help companies explain the different benefits available and provide an easy-to-use interface by which they can engage with the benefits available while also providing wellness solutions for employees.
But companies like Castlight Health have faltered in their bid to offer an intuitive, cloud-based, mobile solution for employees. A new survey also shows that corporate leaders while continuing to invest in benefit programs acknowledge that employees often are unaware of their companies’ offerings, resulting in low engagement and under-used benefit packages.
For Progyny specifically, it will find itself not only competing with the big insurance companies but smaller startups that are also targeting people who want to experience having children. In its S-1 filing, it names companies like WIN Fertility and Optum Fertility Solutions. And then there are companies like Carrot Fertility and Maven Clinic, which has received investment from Serena Williams’ venture firm.
Photo: bayhayalet, Getty Images
Correction: An earlier version had incorrectly reported how much the company earned in profits from continuing operations in the first 6 months of 2019. That figure is $4 million.
