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At-home abortion pill startups gain interest and funding as laws increasingly target access

By Jennifer Korn

As the future of safe, legal abortion access in the United States has been thrust into doubt, a number of at-home abortion pill startups are positioning themselves to fill some of the void.

Sites such as Choix, Hey Jane and Just the Pill have launched in recent years to offer women in a limited number of states abortion prescriptions via telemedicine and delivered by mail. Thanks to the easing of regulations at the federal level, these startups say their services can cut travel time, in-office wait periods and costs. However, they still face significant regulations and — increasingly — a shifting legislative environment as they seek to grow.

Approved by the Food and Drug Administration in 2000, the so-called abortion pill — which involves taking two medications, mifepristone and misoprostol — now accounts for over half of all abortions in the United States, according to the Guttmacher Institute, a research organization that supports abortion rights. Though initially restricted from mail delivery, mifepristone was approved by the FDA for online pharmacy prescription and delivery at the onset of the pandemic, a decision that has since been made permanent. (Misoprostol, also used to prevent ulcers, has long been available with a prescription.)

This regulatory change opened the door to companies that hope to cater to abortion-seekers who either reside in states that allow telehealth abortion care or who travel from their access-restricted home states. While there is no residency or state ID requirements for abortion care, Choix requires patients to have a shipping address within one of the states it serves. Hey Jane requires patients to be within the accessible state for both consult and treatment.

Abortion rights have been called into question after a leaked Supreme Court draft of a majority opinion that would strike down Roe v. Wade was published by Politico in May. The final opinion on the case, which concerns a challenge to Mississippi’s 15-week ban on abortion, is expected to be finalized and published this month. However, several states have already passed restrictive laws using state courts as enforcement or have laws in place that would be triggered as soon as Roe v. Wade is overturned. For example, Texas currently has a six-week abortion ban, SB8, and Oklahoma has banned all abortions unless the mother’s life is endangered or if the pregnancy is a product of rape and/or incest.

The legislative landscape appears to be leading to a surge in customer demand and more fundraising activity for some of the startups. “People are having a moment of reckoning and understand that abortion access will be a really big problem for the foreseeable future,” said Kiki Freedman, CEO of Hey Jane.

A surge in demand

Freedman told CNN Business that Hey Jane has seen a nine-fold increase in new telehealth patients per day compared to the same time last year and has nearly doubled the clinical team size since September when SB8 went into effect in Texas. Choix has had a 300% spike in interest in terms of web traffic and online inquiries into care since the draft of the Supreme Court decision leaked, according to its CEO.

Hey Jane launched in 2021 with goal of leveraging telemed technology to address the ever-shrinking access to abortion in several states. The startup offers abortion pills and peer-to-peer counseling for women up to 10 weeks pregnant.

“We were seeing digital health companies primarily focusing on stigmatized issues in men’s health, such as hair loss or erectile dysfunction,” Freedman said. “I started thinking: Is that a model for safe, discreet, affordable abortion access?”

Now working in six states, Hey Jane’s growth reminds Freedman of the early expansion of Uber, where she worked for four years.

At “Uber — a place that faced a lot of regulatory complexity as it grew — I learned how to scale a business while navigating regulatory complexities,” she said.

Since launching, Hey Jane has raised $3.6 million from investors and strategically placed its care outposts in states that will likely account for the majority of US abortions post-Wade, such as California and New York, according to Freedman. The startup is planning on another round of fundraising soon, she said.

Last week, Choix announced a $1 million fundraising round from Portland-based venture capital firm Elevate Capital to keep up with demand since the leaked Supreme Court report. Choix, launched in late 2020, has a virtual-first model that provides abortion and sexual health services to people in California, Colorado and Illinois.

“As an understanding of abortion care via telehealth grows and access becomes more restricted we anticipate even greater influxes of patient care requests,” Cindy Adam, CEO of Choix, told CNN Business. The start-up hopes to raise another $500,000 to $1 million to expand in more states.

Remote care from services like Choix and Hey Jane cost about half the national average, according to the companies. They also partner with abortion funds to offer patients financial assistance if needed. Even so, these pills still cost between $249 and $289, including consultation fees, medication, shipping and provider check-ins.

States also have different laws surrounding insurance coverage, with only six states requiring abortion coverage in private health plans. Meanwhile, 11 states restrict insurance coverage of abortion in all private plans written in the state, 25 states restrict abortion coverage in plans through exchanges, and 21 states restrict abortion coverage for public employees, according to the Guttmacher Institute.

As a result, a woman faces an average out-of-pocket cost for an early medication abortion of about $504.

The reason for the high cost “is likely because there aren’t a lot of manufacturers for the US market, so even with one generic the costs are high,” Isabel Garnierei of the Guttmacher Institute told CNN Business.

If Roe v. Wade is indeed overturned, many states will act swiftly to restrict, if not eliminate, access to abortions, leaving untold numbers searching for safe care.

“It’s estimated that there will be a 3000% increase in people whose nearest abortion clinic would be in California, and nearly an 8700% increase in people whose nearest abortion clinic would be in Illinois when Roe is overturned,” said Freedman, citing research by the Guttmacher Insitute. “In a post-Roe world, abortion care via mail will likely become the most viable form of access for most of the country.”

™ & © 2022 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

Correction: An earlier version of this story misstated the total amount of funding Hey Jane has received. The company has raised $3.6 million to date.

Article Topic Follows: CNN - Social Media/Technology

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