Meet & Greet with ArloRx and UC Berkeley Students
Editor Disclaimer: The following interview and tour of ArloRx provides insights into their business model, products, and practices. The opinions expressed by the interviewees are their own and not necessarily represent the views of this publication. This conversation and the ArloRx facility tour, is intended for informational purposes only and should not be construed as medical advice. Readers are encouraged to consult healthcare professionals for any medical-related inquiries. We aim to provide a balanced perspective, and while we strive for accuracy, we do not guarantee the completeness or reliability of the information shared.
Are you someone who pays a co-pay for your prescription medications? Do you currently use monthly prescriptions, like birth control or asthma medications? Have you ever wondered why your pet's medication costs less than your medication?
I recently visited with ArloRx Founder and President, Dr. Jay Lalli, DVM, and his brother Jim Lalli, co-founder COO in Hayward, CA. Dr. Jay Lalli is a veterinarian turned entrepreneur, he along with his brother are changing the game in pharmaceuticals, not just for your pets but for everyone.
“When we noticed that families were ordering the same medication for their pets and themselves, we knew there was a way to bridge the (price) gap….” Dr. Jay Lalli, DVM
What is ArloRx?
ArloRx is a technology company helping Americans lower the cost of medications, specifically by cutting out the middlemen in all 50 states. They do this by not working with PBMs (pharmacy benefit managers) and other third-party companies that drive the cost of prescription medications. This means no insurance, no pre-authorizations, and no limits on quantity. It also happens to be the only insurance free pharmacy in Northern California.
If this model sounds novel, that’s because it is. On a recent tour of the ArloRx Hayward facility with Dr. Jay Lalli, DVM, I learned how ArloRx and his team plan on upending the current way we buy our prescription medications.
Inside ArloRx in Hayward, CA.
On our tour, we were joined by Professor David Haddad, of the Fung Fellowship Health + Innovation at UC Berkeley, and a group of his students. Over pizza Dr. Jay Lalli described the ins and outs of the pharmaceutical industry. Students asked questions about marketing, customer service, and direct competitors not just in the Bay Area but throughout the country.
“We started ArloRx to serve the more than 84 million Americans with no or inadequate pharmacy drug coverage…We also see folks who have insurance but want drugs that cost less.” Dr. Jay Lalli, DVM.
Below are questions and answers that were covered during our time. The main takeaways? ArloRx is building trust with patients where it matters most, affordability and reliability. Through their website and call center, you can speak to an actual person (!), and you can have your prescription delivered to your door.
For more information about ArloRx visit their website and speak to a customer service representative 6 days a week.
Questions and Answers with ArloRx Founder and President, Dr. Jay Lalli, DVM, and UC Berkeley students in Hayward, CA.
Student: Do you have your own delivery service?
Dr. Lalli: Patients can order their prescriptions online and pick them up at our facility via curbside. Medications like insulin can be expensive to ship due to its refrigeration requirement. This lowers the cost significantly . We ship to all 50 states via USPS and Fedex.
Student: I wouldn’t trust a medication that I usually pay $200 for, and that was offered for a fraction of that. How do you build trust with customers?
Dr. Lalli: We connect with patients directly.Our call center is a great way to have one-on-one conversations with our customer support team who can immediately answer your questions and that goes a long way in building trust.
Student: How are you getting the word out about your services and prescriptions?
"We are marketing ArloRx strategically to preserve the low price on medications. For example, you won’t see our name and logo on the sides of buses and billboards. This allows us to offer the lowest price possible to our patients." Dr. Jay Lalli, DVM
We don’t look at the market rate of a medication. What we do is see what the drugs will cost us to process, and then we consider our overhead to run a company, and price our drugs accordingly. That keeps our prices low.
Student: Are you reaching out to organizations who serve lower income individuals, like group homes and shelters, who might really need your service? Do you think your business would serve communities like that?
Dr. Lalli: There’s a potential for that. When we started ArloRx we wanted to serve the more than 84 million Americans with no or inadequate pharmacy drug coverage. That is our goal. There are some challenges to serving the unhoused populations. We need addresses, for instance. We would have to work with a facility of sorts and have drugs delivered there and then distributed to people in need by administrators.
In general, we’re doing a lot of community outreach and engagement. Specifically with Hayward Rotary and Chamber of Commerce organizations. It’s very important to reach out to organizations so they know who we are and how we can help lower income individuals.
Student: Are you going directly to the manufacturer?
Dr. Lalli: We are doing both. For instance for high volume medications, we can go directly to the manufacturer and pass those savings on to our patients. But the main crux is that if a pill costs 5 cents, there is only so much lower that pill can go.
In 1983, of all the prescriptions dispensed in the U.S., 19% were generic, but the PBMs got involved putting pressure on all facets of the industry. Now in 2024, 92% of all prescriptions dispensed are generics– but they cost more. Why? Because PBMs are artificially increasing the price of generic medications.
Let me give you an example. Medicare will pay for a medication that costs only $10 to make, but it will pay the PBM $2,000, and then the patient has a $100 co-pay. You can come to our website and get the same drug for $20. So that’s the impact we’re trying to make for the everyday patient.
Professor David Haddad: When I worked in pharma, I found out that in order to change physician behavior the industry would spend 38 million dollars on steak dinners. Or what they called steak dinners. This was to educate doctors on research that they paid for in order for doctors to suggest those medications to their patients. Which is to say that your model is turning the industry on its head.
Olga: Just today, the House of Representatives passed a law, greatly impacting Medicare and Medicaid. Does that affect your business tomorrow?
Dr. Lalli: The nice thing about our model is that we don't have allegiance to the federal government. What they do doesn’t affect us; however, it does affect the everyday consumer. Either way, we’ll be a provider to anyone who is affected, if and when new legislation goes into effect.
A final note from me…
ArloRx is licensed in all 50 states, they bypass PBMs, and house over 1000+ generic medications. Their pharmacy, call center, and warehouse are all in one location. Whether or not new or upcoming legislation changes how you buy your prescriptions, ArloRx is worth looking into.
Notes from the editor:
Role of Pharmacy Benefit Managers (PBMs): PBMs do play a significant role in the pharmaceutical industry, acting as intermediaries between insurers, pharmacies, and drug manufacturers. They negotiate prices and manage formularies, which can indeed impact drug pricing.
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