A Primer on LifeMD

Shareholdersunite

Mar 30, 2025

A background Primer, serving as an introduction and context for our Quick Take, which discusses the investment prospects and finances.

Overview

LifeMD (LFMD) is a direct-to-patient telehealth company focused on providing high-quality, cost-effective, and convenient virtual and in-home healthcare. The company aims to improve the traditional healthcare model by offering solutions through its proprietary technology platform, affiliated provider network, and broad treatment capabilities.
LifeMD's platform integrates a 50-state medical group, a nationwide pharmacy network, a wholly-owned affiliated commercial pharmacy, nationwide laboratory and diagnostic testing capabilities, a fully integrated electronic medical records (EMR) system, and a patient care and service call center.
These integrated capabilities support a wide range of healthcare needs, including primary care, chronic disease management, and lifestyle healthcare. Currently, LifeMD treats approximately 275K active patient subscribers across various medical needs such as men’s sexual health, weight management, sleep, hair loss, and hormonal therapy. Their virtual primary care services are primarily offered on a subscription basis. Since its inception, LifeMD has served approximately 1.12M customers and patients.

LifeMD operates as a patient-centric telehealth company delivering end-to-end virtual healthcare directly to consumers and through select enterprise (B2B) partnerships.
Its robust technology platform seamlessly connects various touchpoints of care delivery, including scheduling, EMR, communication, prescriptions, and pharmacy and laboratory integrations. Offerings are primarily sold on a subscription basis, fostering patient relationships and recurring revenue.
LifeMD serves patients across urgent, chronic, and lifestyle healthcare needs, with prescription medications and OTC products fulfilled by their in-house pharmacy or third-party partners. The company also utilizes a robust customer relationship management (CRM) and performance marketing platform to acquire and retain patients.

Direct-to-Patient Telehealth Brands

LifeMD leverages its platform across its direct-to-patient telehealth brands:

LifeMD: Offers access to virtual primary care and telehealth services, covering over 200 conditions. It provides comprehensive virtual medical care, including consultations, prescriptions, diagnostics, wellness coaching, and integration with in-home tools. As of December 31, 2024, LifeMD has served approximately 225K customers and patients.
The GLP-1 Weight Management Program, launched in April 2023, had over 75K patient subscribers as of December 31, 2024. This program offers primary care, metabolic coaching, lab work, and prescriptions for GLP-1 medications. In September 2024, a personalized, non-GLP-1 treatment plan was added. LifeMD has developed an electronic benefits verification program and partnered with an AI platform to improve insurance coverage for branded GLP-1 medications. LifeMD began accepting commercial insurance in June 2024, with a goal of nationwide coverage by the end of 2025, and Medicare enrollment expected in the first half of 2025.
Rex MD: A men’s telehealth platform providing virtual treatment for various men’s health needs, including erectile dysfunction, premature ejaculation, and hair loss. It has expanded to include weight management and testosterone replacement therapy (HRT). Rex MD has served approximately 607K customers and patients to date.
ShapiroMD: A legacy brand offering virtual treatment, prescription medications, patented OTC products, compounded medications, and FDA-approved devices for male and female hair loss. It has served approximately 265K customers and patients to date.
LifeMD launched its wholly-owned affiliated commercial pharmacy in November 2024, licensed in 49 states as of Q1 2025 and shipping up to 20K orders per month. This is expected to yield $5M in annualized expense savings. Non-sterile compounding capabilities are being built during the first half of 2025.

Partnerships

LifeMD partners with healthcare product companies to provide digital patient awareness, access to care, adherence, and compliance solutions. Notable partnerships include:

Withings provides LifeMD’s GLP-1 weight-loss patients with in-home health monitoring devices.
Ash Wellness for at-home, self-collection laboratory health testing.
Medifast provides Medifast’s clients access to a clinically supported weight management program, including GLP-1 medications.
ASCEND Therapeutics provides integrated telehealth services to improve access to EstroGel®.

WorkSimpli

LifeMD owns 73.32% of WorkSimpli, a provider of workplace and document services for consumers, gig workers, and small businesses. Brands include PDFSimpli, ResumeBuild, SignSimpli, and LegalSimpli. WorkSimpli had approximately 164K active subscriptions as of December 31, 2024.

Growth Strategy

LifeMD’s growth strategy focuses on wise investments in differentiated telehealth service offerings and initiatives that enhance the patient experience. Key areas of focus include:

Behavioral Health: Expanding services to include teletherapy, psychiatry, and medication management for mental health conditions.
Women’s Health: Developing a holistic, personalized, and accessible care approach for women, focusing on areas like menopause and osteoporosis.
Re-launching virtual primary care as LifeMD+: Providing 24/7 access to general wellness, prescription management, and urgent care on a cash pay and insurance basis.

LifeMD aims to strengthen customer repurchase rates and overall customer retention through these investments.

Competition

The markets LifeMD serves are large and highly competitive, with numerous online brands competing in virtual primary care, weight loss, men’s and women’s health, and hair loss.
LifeMD also competes with traditional mass merchandisers, drug store chains, and independent pharmacies. The company emphasizes a patient-centric approach and quality of care as key to maintaining its market position.

Competitive advantage

An affiliated 50-state medical group with mostly full-time providers.
An industry-leading telehealth technology platform supporting complex primary care.
A wholly-owned affiliated commercial pharmacy and fulfillment center.
Flexible patient payment options, including increasing insurance capabilities.
An in-house patient service and call center.
Robust CRM, patient acquisition, and retention capabilities leveraging data analytics and AI.
A compliance-first mindset with a full-scale EMR system.

Technology Platform

LifeMD's telehealth technology platform is continually optimized and can be repurposed for various telehealth offerings. Key capabilities include proprietary staffing algorithms, full CRM functionality, integration with the physician network and pharmacies, a fully integrated EMR system, synchronous and asynchronous communications, and AI-enabled support.

Intellectual Property

LifeMD relies on trademarks, copyrights, trade secrets, proprietary technologies, and license agreements to protect its intellectual property. Material trademarks include ShapiroMD Hair Growth Experts® and Cleared®. Trademark applications are filed for RexMD, LifeMD, and NavaMD. The company holds two U.S. patents related to Shapiro MD hair loss treatments.

Finances

Telehealth revenue increased by 61% for the year ended December 31, 2024, compared to the previous year. Total revenue from recurring subscriptions is approximately 92%.
The company produces excellent gross margins (which will return to 90% in FY25):