Kalderos, a company developing tools that help pharmaceutical providers and manufacturers manage drug discounts, today announced it raised $28 million. The startup plans to use the funding to bolster its point-of-sale solution, expand to support other discount types, and explore other financial exchanges that might benefit from its infrastructure.
Achieving compliance with drug discount programs like the Medicaid Drug Rebate Program is often a fraught, lengthy, and complicated endeavor. For instance, it’s been alleged that health systems illicitly use the 340B Drug Discount Program of the U.S. Public Health Service Act, which enables organizations serving vulnerable populations to purchase prescription drugs at a discount, to profit by growing their businesses.
Kalderos aims to tackle this with models and machine learning processes that detect discount program inconsistencies overlooked by current methods. For instance, its Review tool allows manufacturers to work with 340B-covered entities in “good faith” to validate suspected duplicate discounts. By collecting information from pharmaceutical manufacturers, Medicaid agencies, and payers and comparing it with a data set of past instances of noncompliance, Review is able to continuously search for anomalies with algorithms to identify claims for review.
As for Kalderos’ Request tool, it enables providers to request drug discounts at point of sale — that is, where drugs are dispensed. Customers get direct payments for discounts from multiple manufacturers instead of credit toward future purchases, as well as up-to-date reporting that supports compliance record-keeping. Request lets drug providers work with manufacturers to correct and resolve incorrect discount requests, moreover, ensuring people get the right discounts for claims.
There’s also Kalderos Pay, a tool designed to enable manufacturers to work with providers to facilitate the exchange of drug discounts on a single platform. Together with Request, it controls active discount programs in accordance with law and contract, helping to ensure the programs work as intended on behalf of patients. Built-in automation and validation rules help prevent noncompliant discount payments, and Kalderos says it works with manufacturers to load contracts, rules, and other inputs to expedite discount payment decision-making.
“We’ve built our bespoke infrastructure to recover noncompliant discounts that have occurred in the past and ensure drug discount compliance at the point of sale,” a spokesperson told VentureBeat via email. “With our proprietary datasets, algorithms, validations, and machine learning, our platform is constantly learning and improving in order to provide actionable insights for our customers.”
Currently, Chicago-based Kalderos works with 10 drug manufacturers and over 2,500 providers in all 50 U.S. states. In the near future, it intends to launch a 501(c)(3) nonprofit arm that will support patients by ensuring those who need lifesaving medications can afford them.
This latest funding round brings four-year-old Kalderos’ total raised to over $35 million following $7 million in series A financing in May 2019. Bain Capital Ventures led the round with participation from Mercato Partners.