CoverMyMeds names new top leaders from within
CoverMyMeds, one of the region’s fastest growing and most admired technology companies, has promoted two senior executives to run the business as co-founder and CEO Matt Scantland prepares to leave and Chief Operating Officer Michelle Brown takes a new role.
Senior Vice President David Holladay is now president at CoverMyMeds and Scott Gaines is COO. The two executives were senior vice presidents of the company’s payer and provider solutions groups, respectively.
Seen as a beacon for the rise of central Ohio’s startup scene, CoverMyMeds made waves becoming the first startup in Ohio history to be sold for $1 billion or more when it was acquired in 2017 by pharmaceutical distributor McKesson Corp. for $1.3 billion. The Columbus health care technology company founded in 2008 has doubled in size every year. It now has about 1,000 employees across offices at Miranova, at 41 S. High St. and in the Cleveland area.
When he shared his plan to step down and appoint Holladay as CoverMyMeds’ president with McKesson CEO Brian Tyler, “they already knew David and were incredibly supportive,” Scantland says. “We have a great relationship that we could have continued. But once I explained that I thought now was the right time to make this transition, they were incredibly supportive. They’re committed to David and all of the leaders here.”
Tyler took the helm at McKesson, a giant ranked No. 7 on the Fortune 500 with $208 billion in 2018 revenue, in April and moved its headquarters from San Francisco to Las Colinas, Texas, outside Dallas. He spoke to CoverMyMeds’ mission of helping patients get the prescriptions they need to live healthy lives and the company's importance to McKesson.
“CoverMyMeds' impact goes right to the heart of the McKesson growth strategies in specialty, manufacturer value proposition, and future retail models. We have an opportunity to contribute to the future as part of one of the few companies in the world that can reinvent health care for the good of millions of patients who are counting on us," Tyler said in a statement. "I have a great deal of respect for Matt’s unique leadership and view of the world and will miss working with him. We are grateful for the contributions he has made, and it is an honor to both Matt and me that we are making this transition after so much success between us, and with an incredible growth path and leadership team in place. I wish Matt all the best and hope our paths will cross again.”
The leadership transition in Columbus was no surprise, Scantland said during an interview at the company’s Miranova headquarters. The idea always has been that CoverMyMeds would outlast its founding CEO. Indeed, that eventuality was the inspiration for his leadership style focused around empowering all employees and “creating 1,000 leaders,” he says. Those leaders were ready now, and rather than prolong the change into the future, which holds no guarantees, Scantland wanted to act now.
Brown, who has been with CoverMyMeds since its 2008 founding and worked with Scantland prior to that in his consulting business, takes a role focused on growing leadership at the company. That left the COO role open for Gaines, who has been training for the job since he joined the company five years ago, Scantland says. “This was an incredibly collaborative process,” he says.
Scantland will continue to report to work through the end of the year, ensuring a smooth transition. By all accounts, CoverMyMeds’ business is going well: It’s tripled or nearly tripled in virtually every measure since it was acquired by McKesson in 2017, Scantland said. The company doesn’t release revenue.
Plans for a $240 million headquarters complex in Franklinton on land that was partially owned by Scantland’s identical twin brother, Pete Scantland, and his neighboring Orange Barrel Media will go forward as planned. (The acreage for the project has since been sold to the project's developer.) “We are as committed to Franklinton as ever,” Scantland says. The campus is expected to be ready for its first employees in 2021 and will grow to accommodate at least 1,000 hires over five years.
With office kayaks that can be rented by employees and chef-prepared free lunches every day, CoverMyMeds routinely has won honors for its workplace culture from various organizations, including being named Columbus CEO’s No. 2 large organization in its Top Workplaces awards for 2019. This marked the sixth year the company has been on the magazine’s Top Workplaces list, where the results of anonymous employee surveys ranked CoverMyMeds No. 1 in its size band three times.
The company's network includes more 700,000 health care providers, 96 percent of pharmacies and payers representing 80 percent of U.S. prescription volume. Its model to help people get the prescriptions they need was founded on automating the cumbersome, analog prior authorization process. It has since diversified, adding four business channels focused on the patient journey from diagnosis to regular prescription refills.
Holladay is the right person for the company's top job because he “has a deep respect for the people of CoverMyMeds and the culture here—and he will, I believe, have the wisdom to know what to protect and sustain but also the courage to know what needs to change,” Scantland says. “I think broadly what needs to change is we need to keep growing, we need to keep innovating, we need to be what the world needs us to be tomorrow.
“The things that don't need to change are the approach and the culture and the belief that we win through our employees,” he says. “We chose David because he will do both, and has a real respect for what we've done. So this isn't going to be one of those things where the new person comes in and wipes the slate.”
Holladay says preserving the culture of employees hungry to take on challenges, move quickly, be creative and “do big things” that seem just out of reach— the ingredients that have spurred CoverMyMeds’ rapid growth—is paramount to the company’s success. “In our discussions with McKesson leadership about this transition, we heard a strong commitment to CoverMyMeds as a growth engine, and an acknowledgement that what makes this possible is our culture and our approach to solving big problems,” he says in a statement.
“CoverMyMeds is really special because of our people,” he says. “We have a mission that matters and attracts the right people, and we serve an important purpose in the world. That is why being here felt like such a natural fit to me. There is so much value in being a part of a purpose-driven organization. Our staff improves the lives of health care professionals and patients every day. I am inspired to come to work every day."
Holladay previously held senior executive roles at Cigna, Humana and technology company RxEDO. COO Gaines was senior vice president and general manager of provider solutions at CoverMyMeds, and prior to that was an executive at health care technology firm Hyland Software.
Scantland, who is a member of the Columbus Partnership and has been seen among its next generation of leaders, is parting with the company “on incredible terms, with an incredible opportunity for the people here,” he says. “And that was what motivated me more than anything else to make this transition—to do it at the right time, so that the company continues to thrive, and I think now is the right time.
“But I will miss it. When we let our employees know about this transition last week, it was a lot of emotions. … There have been some tears for me. But they're happy tears. It was emotional, but it was that bittersweet kind of emotion. I feel so fortunate … there have been challenges because doing something big is hard. What I'm so proud of is that after all of those (challenges), we all love each other. And that to me is the note I wanted it to end on.
“I'm looking forward to taking a bit of a breather, having more presence with my friends and family,” he says. The 40-year-old Upper Arlington native still lives there with his wife, Meara, and sons who are 7 and 3 years old. He won't be leaving Columbus, he says, and like many company founders who sell their enterprises for substantial sums, he will continue as a player in the region's business community.
“When the time is, right, I want to continue with my personal purpose, which is to help build companies that create opportunity for the people that I work with. I hope to be helpful to organizations that want to do something great for the world.”
Katy Smith is the editor of Columbus CEO.
