From Over-the-Counter to Prescription: Scaling Digital Health Products the Right Way

For digital health founders, the promise of transforming how patients access treatments is huge. Whether through telemedicine, digital therapeutics, or e-pharmacies, there is a compelling opportunity to deliver convenient, data-driven care at scale.

However, many early-stage health tech entrepreneurs make the mistake of diving directly into prescription-based business models, only to find themselves tangled in a web of complex regulations, licensing hurdles, and compliance challenges.

An alternative — and smarter — approach is to start with over-the-counter (OTC) products. Here’s why an OTC-first strategy can help you build traction, generate early revenue, and prepare for eventual prescription integration in a sustainable way.

Why OTC Is a Smart Starting Point

1. Lower Regulatory Barriers

OTC products are subject to far fewer restrictions than prescription-only medications. You don’t need to manage remote prescribing protocols, licensed practitioner networks, or controlled substance monitoring.

This means you can:

✅ Launch faster
✅ Simplify compliance
✅ Focus on customer experience rather than legal red tape

2. Build Relationships and Brand Trust

By delivering a high-quality OTC product experience, you build credibility with both customers and the broader healthcare ecosystem. Pharmacies, insurers, and health systems are more likely to trust a digital health startup that has demonstrated operational excellence and strong outcomes in the lower-risk OTC category.

This trust becomes a valuable asset later when negotiating partnerships for prescription-based offerings.

3. Generate Revenue Sooner

Prescription-based models often involve lengthy pilots, clinical trials, and complex negotiations with health authorities. OTC products, on the other hand, can hit the market faster and start generating revenue earlier.

This revenue can help sustain your team while you work through the more complex, long-term prescription strategy.

4. Test and Optimize the User Experience

Before adding the regulatory and operational complexity of prescriptions, you can use OTC models to test:

✅ Product-market fit
✅ Customer acquisition channels
✅ Pricing strategies
✅ Digital onboarding and support tools

This gives you critical data and confidence to design a prescription product offering that works seamlessly for users.

How to Transition to Prescriptions Later

Once you’ve proven success in OTC, you can start layering in prescription-based services. Here’s how to do it thoughtfully:

Build a trusted doctor network: Identify telemedicine partners with strong licensing and compliance processes.

Plan your data infrastructure: Ensure your systems are secure and compliant for storing prescription data and patient health information.

Understand market-by-market rules: Prescription regulations vary widely across states and countries; plan your compliance strategy early.

Design for clinical evidence: If you move into digital therapeutics, be ready to conduct trials and measure health outcomes.

Educate stakeholders: Patients, doctors, and pharmacies will need clear communication about how your prescription product works and why they should trust it.

A Phased Approach Wins

By starting with OTC and scaling up, you reduce risk while laying a solid foundation for growth. Your brand, your operations, and your compliance practices will mature in a lower-stakes environment before tackling the higher-stakes world of prescriptions.

Final Thoughts

The digital health revolution is here, but navigating its complexities takes patience and strategy. If you’re a founder, think of OTC as your launchpad — a way to prove value, build trust, and gain traction.

Once you’ve mastered that foundation, expanding into prescription products will feel far more achievable, giving you the best shot at sustainable success.