Is Your FullScript Revenue in Jeopardy?
February 18, 2025Brett Sparks, MBA-HCM
President, e3Business, LLC
Fullscript’s New Partnership
Fullscript been a valued vendor for supplement-focused practices that want to avoid the cost and headache of carrying supplement inventory. By requiring patients to have an invitation to place supplement orders, Fullscript ensures that providers earn referral revenue for the supplements they recommend and support. A 2023 Nutrition Business Journal survey of practitioners with a relationship with supplement companies found that “More than half of surveyed practitioners claim supplements sales to be ‘essential’ or ‘very essential’ to their business, and a quarter rank ‘practitioner exclusivity’ as a top driver for brand selection,” and identified the loss of exclusivity to online sites like Amazon as the biggest threat to provider supplement sales.[1]
Knowing the importance of supplement revenue to independent practices, I was surprised to see a November 2024 email announcing that Fullscript partnered with Pendulum Therapeutics to “set new standards, providing healthcare providers with research-driven insights to support whole person care and improve patient outcomes.”[2] On January 10, 2025, Pendulum sent a “Welcome to the Pendulum healthcare provider community” email that featured the Pendulum PRO and Fullscript logos with opportunities to learn more about Pendulum products. The reply email was FullscriptHCP@pendulumlife.com. On February 14, 2025, even though I had not signed up to receive Pendulum emails—or ordered Pendulum products—I received an email from Pendulum promoting a 20% off sale on the supplements, with the discount on retail prices. The email was “intended for new customers only.” It did not seem aimed exclusively at providers.
The order link from the email link didn’t take customers to Fullscript—where providers would receive credit for the sale—but to Pendulum, where no provider code is necessary. In essence, it appears that Fullscript’s partnership with Pendulum has allowed Pendulum to use at least some of Fullscript’s emails to promote its products. Even if the email I received didn’t go to Fullscript’s patients, it seems that Fullscript’s partnership with Pendulum could easily result in providers losing referral revenue.
While supplement companies on Fullscript’s site also sell directly to patients, I’ve never seen Fullscript directly market for those supplement companies. I went through the last two years of emails I received from Fullscript. I don’t see that they have ever marketed for services other than services offered by Fullscript—which calls into question the relationship between Fullscript and Pendulum as well as possible competing interests.
The impact could be significant to providers who rely on Fullscript. Pendulum is aggressive in promoting their supplements. After clicking the “Shop Now” link in the February 14th email and adding a product to my cart to see if a provider code was required, I received several emails from Pendulum over the next three days reminding me to order and promoting the 20% off. Pendulum’s professional website features the endorsement of notable physicians such as Mark Hyman and well-known actor Halle Berry. Pendulum offers referral programs to earn revenue from supplement recommendations, but these programs are not limited to licensed healthcare professionals.
Why Would Fullscript Partner with Pendulum?
Since Fullscript’s core business is providing a “safe space” or what has been called “gated access” for providers to connect patients to supplements, why would Fullscript partner with a supplement company that could undercut its core business? For my thoughts on that, let me digress.
One of the indicators I look at every couple of years is the providers listed on the Institute for Functional Medicine’s (IFM) provider search tool. I’ve analyzed the providers listed there in 2016, 2019 and 2023.[3] From the total physicians listed, I remove those physicians who are not in practice and look at which specialists and primary care physicians are independent, (which also shows the number of specialists and primary care physicians who practice for corporate medicine). From 2016 to 2019, independent primary care physicians, which I consider the core market of functional medicine, increased from just over 300 physicians to almost 500 physicians, while the number of active physicians remained steady at just under 700 physicians.
By 2023, (the period encompassing the COVID pandemic), the total active physicians on the IFM provider search dropped slightly from 2019 to 2023, (a decrease of about 30 physicians), but the number of independent primary care physicians dropped from almost 500 physicians below 300 physicians—a reduction from 2016 levels. If the IFM Provider Search directory is any indication, the pandemic set the independent functional medicine primary care physician market back to pre-2016 numbers—which would mean that the market retained no growth over the seven-year period between 2016 and 2023.
While functional medicine has always been touted as both a better care model for patients and a financial boon for providers, I think these numbers show the reality many functional medicine providers face: Functional medicine may help patients, but it is difficult to monetize the practice of functional medicine.
As the pandemic was busy erasing the gains functional medicine seems to have made with independent primary care physicians, Fullscript expanded beyond its initial angel investor funding of $2 million to $3 million. In May 2019 Fullscript received a $25 million investment[4] and followed with $240 million in funding in 2021, at which point it had annual revenue of $300 million according to Fullscript’s website.[5] Fullscript joined with Natural Partners in November 2021.[6] In March 2022, Fullscript reportedly nearly doubled their revenue, patients and providers in acquiring Emerson Ecologics.[7] Fullscript further expanded by acquiring Rupa Health in October 2024.[8] None of the financials for these transactions have been disclosed.
So from 2019 to 2023—while Fullscript’s total funding may have increased from $3 million to $265 million plus potential liabilities from the acquisition of Natural Partners, Emerson Ecologics and Rupa Health—the number of independent functional medicine primary care physicians who would be the main driver of Fullscript’s growth could have declined by 46%, as shown here:
Could you blame Fullscript if they were looking to find new revenue streams?
What to do?
To be clear, in my experience, Fullscript has always been a good company for medical providers. I have had disputes with several supplement companies regarding tracking referral revenue and contract language—so I may be difficult—but I’ve never had a problem with Fullscript. None of the providers I’ve talked to over the years have had a problem with Fullscript, either. If Fullscript does financially benefit from patients ordering directly from Pendulum, however, I don’t think you can blame them. It is just the reality of business.
I still think providers need to face the reality of their business and implement contingency plans to protect and expand revenue streams. Even if Fullscript isn’t complicit in steering patient orders away from provider referrals, there is no doubt that the direct-to-consumer market is a large, untapped market for Fullscript. The entire dietary supplement market was estimated to be over $53 billion in 2023,[9] with sales by medical practitioners estimated at less than 2% of total sales.[10] Expanding into direct-to-consumer sales could exponentially increase Fullscript’s revenue.
Fullscript’s expansion in the face of the pandemic and the potentially significant decrease of independent functional medicine primary care physicians cause for concern in and of itself. There is no telling how the increased funding and acquisitions during the pandemic has impacted Fullscript and what will happen if it doesn’t expand revenue. Fullscript wouldn’t be the first company to close due to an ill-timed expansion. Finally, there is always the possibility that supplement revenue may end due to regulations, as both the American Medical Association and the Federation of State Medical Boards have taken a stand against provider supplement sales.[11]
So regardless of whatever impact Fullscript’s partnership with Pendulum has on medical practices that rely on Fullscript revenue, it would be good to safeguard current revenue streams, prepare for changing conditions that eliminate revenue streams, and explore new revenue streams. So much time is understandably focused on the day-to-day practice operations, but hiring a consultant for a practice review and exploring options to improve revenue, including direct primary care, concierge medicine, and hybrid models, could be an investment in securing future viability.
I have had success with the FMEC patient engagement platform, but no model is right for every practice, which is why I try to provide a variety of vendors—including practice consultants—on TheSupportPlatform.com. I really don’t know if my cause for concern for future Fullscript revenue is justified, but I would encourage practices to consider how a decrease in any revenue stream would impact their bottom line so that they can make plans to address such an event. One thing is certain: Providers need to give their practice the same attention they devote to patients.
[1] The Editor’s Take: Medical doctors uplift dietary supplement industry, Bill Giebler. Nutrition Business Journal, Jan 23, 2024. https://www.newhope.com/market-data-and-analysis/the-editors-take-medical-doctors-uplift-dietary-supplement-industry
[2] Pioneering Health Innovation: A First-of-its-kind Research Partnership Between Fullscript and Pendulum Therapeutics, Nov 19, 2024. https://fullscript.com/blog/fullscript-pendulum-research-partnership
[3] My analysis of IFM’s provider search is far from perfect. It doesn’t include nurse practitioners or physician assistants. It relies upon assumptions made from simple web searches regarding the activity, employment status and practice focus of providers. The reports for the 2016, 2019 and 2023 analysis are available to subscribers of thesupportpractice.com.
[4] Natural Partners Fullscript plans to double in size with US$25M series-B round, Craig Lord. Ottawa Business Journal, May 21, 2019. https://obj.ca/natural-partners-fullscript-plans-to-double-in-size-with-us25m-series-b-round/
[5] HGGC and Snapdragon to Make $240 Million Growth Investment in Fullscript, Nov 10, 2021. https://fullscript.com/blog/240-million-growth-investment-in-fullscript
[6] HGGC’s Fullscript acquires Emerson Ecologics as addition to health-technology platform, Aaron Weitzman. PE Hub, Mar 17, 2022. https://www.pehub.com/hggcs-fullscript-acquires-emerson-ecologics-as-addition-to-health-technology-platform/
[7] Fullscript Acquires Emerson Ecologics on Mission to Transform Health Delivery, Sean Moloughney. Nutraceuticals World, Mar 30, 2022. https://www.nutraceuticalsworld.com/exclusives/fullscript-acquires-emerson-ecologics-on-mission-to-transform-health-delivery/
[8] Fullscript Acquires Rupa Health, Nov 10, 2024. https://fullscript.com/blog/fullscript-acquires-rupa-health
[9] Dietary Supplements Market Size & Trends, Grand View Research. https://www.grandviewresearch.com/industry-analysis/dietary-supplements-market-report
[10] The Editor’s Take: Medical doctors uplift dietary supplement industry, Bill Giebler. Nutrition Business Journal, Jan 23, 2024. https://www.newhope.com/market-data-and-analysis/the-editors-take-medical-doctors-uplift-dietary-supplement-industry
[11] Are physician online dietary supplement sales, kickbacks or fee-splitting? Apr 2016. https://cohenhealthcarelaw.com/2016/04/are-physician-online-dietary-supplement-sales-kickbacks-or-fee-splitting/