Good morning, Broadsheet readers! Fortune's Best Companies to Work For list features two women-led companies in the top 10, the Biden administration is investing in repurposing coal mines, and Fortune's Maria Aspan reports on the big business problems for birth control companies. Have a great day!
- Birth control fail. Ten years ago, Saundra Pelletier joined what became Evofem Biosciences, a small pharma company focusing on women’s health. A passionate, tireless CEO—and a savvy, feminist marketer—Pelletier spent the next seven years in expensive regulatory limbo, fighting for FDA approval for Evofem’s first and only product. Finally, in 2020, Evofem was able to launch that drug, a nonhormonal contraceptive gel called Phexxi.
Today, more than 100,000 women have gotten prescriptions for Phexxi–but Evofem is still on the brink of failure. “We are on life support,” Pelletier acknowledges. “We will do anything to survive outside of bankruptcy.”
Some of Evofem’s problems are of Pelletier’s own making, as I report in a feature investigation that Fortune published today. But the worst body blows to its business came from the broken health care system—and the damage extends far beyond one small drugmaker.
More than 47 million U.S. women use contraceptives, and doctors and patients alike say there’s a real need for innovation in birth control (especially in the post-Roe v. Wade era). But most investors and big companies have largely abandoned women’s health, leaving contraception to small, scrappy specialists including Evofem and Agile Therapeutics. Now there’s a particularly infuriating—and damaging—financial problem facing these companies: They can’t get big insurance companies to pay for their products, despite a federal law requiring insurers to do so.
“It’s pretty bad—and it’s just rampant,” says Mara Gandal-Powers, director of birth control access and senior counsel for the National Women’s Law Center. “Health insurance companies are not covering newer products the way they’re supposed to.”
The Biden Administration says it is “actively investigating” reports of insurer noncompliance (while the insurers and their pharmacy benefit managers generally say they are working to comply with the law). Any government action would help the 73 million U.S. women of reproductive age, for whom access to reproductive health care is more important than ever. And in a best-case scenario, stricter enforcement might even lead to more and better contraceptive options for women. But it may not come quickly enough to save Evofem–or to encourage other companies to innovate in this crucial, if widely overlooked, market.
Pelletier isn’t giving up, even as her company has laid off most of its staff and effectively put itself up for sale. But it’s hard to be optimistic about the systemic hurdles facing her industry, and how they restrict the health care available to more than half of the population. As one of Evofem’s competitors, Agile CEO Al Altomari, warns: “When an entrepreneur comes to me and says they want to start a new women’s health care company, I tell them, ‘Don’t do it.’”
Read the full story here.
Maria Aspan
maria.aspan@fortune.com
@mariaaspan
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