A decade in the making, Fullscript has suddenly burst into prominence. The Ottawa-based pioneer in the distribution and analysis of nutritional supplements revealed Thursday it had acquired a major competitor, Emerson Ecologics of New Hampshire.
“This is a transformative deal for us,” Fullscript CEO and co-founder Kyle Braatz said in an interview with this newspaper. “We both have the same mission, which is to make sure health care is a long-term journey, not a series of short-term fixes.”
The deal will double to 70,000 the number of physicians, nurses and other “wellness practitioners” who use Fullscript’s technology platform to personalize nutritional regimens on behalf of millions of patients. It also promises to make Fullscript a significant player in North America’s burgeoning wellness industry. The price of the acquisition was not disclosed.
Emerson had been developing a competing platform, but Fullscript evidently won the race. Fullscript’s technology acts like an extension of a medical practice, ordering and dispensing brand-name supplements and providing insight into which nutritional plans work best.
Braatz, 37, estimated that revenues for the combined company will top US$600 million this year, compared to slightly less than US$300 million in 2021. This puts it nearly on par with the early trajectory of e-commerce star Shopify. In its 11th year after launch, 2017, Shopify generated US$673 million in revenues.
There are, of course, two importance differences. Although Fullscript has been growing quickly of its own accord, much of its revenue base reflects the additions of Emerson as well as Natural Partners, an Arizona-based wholesaler of nutritional supplements acquired in 2018. On the other hand, Shopify lost a significant amount of money by design until the pandemic, while Fullscript’s profit margins appear to be significant.
Fullscript will pay for its acquisition of Emerson with a combination of cash and shares. The company will dip into the US$240 million in equity it raised last November — one of the largest venture capital financings in the region’s history. Fullscript is also taking on debt to apply against the purchase price. And, not least, Emerson’s owners have purchased equity in Fullscript.
In the wake of the deal, Fullscript’s workforce will top 950. The headquarters will remain in Ottawa, where some 250 employees concentrate largely on R&D tasks ranging from software engineering and product development to analyzing data. The company has a major distribution centre in Mississauga and is planning another for British Columbia in the coming months. These are in addition to warehouses maintained throughout the United States.
Fullscript serves Canadian and U.S. customers from separate facilities, reflecting variations in local health regulations.
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