Yahoo Finance

Some of these dire problems are of Pelletier’s own making. But the worst body blows—to Evofem, to the handful of other companies in its critical market, and to the 47 million U.S. women who use contraception—have come from a broken health care system. Investors and large pharma companies have largely abandoned women’s health, leaving the development of new contraceptives to small, scrappy specialists like Evofem, Agile Therapeutics, and TherapeuticsMD. All three of those companies won FDA approval for new contraceptives in the past five years—only to discover that most big insurance companies would not fully cover their products, despite a federal law requiring them to do so.

Since 2012, the Affordable Care Act has mandated that insurers cover the full costs of women’s contraception. But in practice, they simply don’t—especially for newer, more expensive forms of birth control. Most private health care plans are not fully covering about 50% of contraceptive products approved by the FDA after 2011, a damning October report from the U.S. House of Representatives found.

The result is a climate that stifles innovation and further restricts the health care available to the 73 million U.S. women of reproductive age. In the post–Roe v. Wade era, access to birth control is more important than ever. But insurers’ decisions are making it financially impossible for small contraceptive manufacturers to survive, according to dozens of Fortune interviews with pharma executives, patients, doctors, current and former government officials, and nonprofit experts.

“It’s pretty bad—and it’s just rampant,” says Mara Gandal-Powers, director of birth control access and senior counsel for the National Women’s Law Center. “Health insurance companies are not covering newer products the way they’re supposed to.”

In December, TherapeuticsMD licensed out its women’s health products and laid off its remaining staff. Evofem and Agile are both scrambling to stave off a similar fate. So when Pelletier rose at 4 a.m. on that rainy mid-February day, she put on a Valentine’s-appropriate scarlet pantsuit. She prepared to drive down the Pacific coast to Evofem’s barren, post-layoff offices. And while it was still dark out, Evofem’s CEO got on the phone with her remaining investors, begging them to keep her company alive for a few more weeks.

“We are on life support,” she says. “There’s nothing I would not do for this company to succeed.”

Birth control addresses a very old problem—one that, at first glance, appears abundantly solved. Since the FDA approved the first oral contraceptive in 1960, pharmaceutical companies have launched dozens of pills, patches, rings, intrauterine devices (IUDs), implants, and more. These popular and familiar products have benefited men and women alike, as well as society and business at large; for example, the pill has been widely credited with substantially increasing women’s wages, college attendance rates, workforce participation, and entrance into skilled careers.

But just because we have a lot of options doesn’t mean we have enough of them. Several million U.S. women, at least, are unhappy with their available contraception options, several research studies suggest. One in six U.S. women of reproductive age don’t want to become pregnant but still don’t use contraception, for reasons including worries about side effects and dissatisfaction with the available methods, according to a survey by Kaiser Family Foundation.

“There is no perfect method,” says Dr. Tina Raine-Bennett, an ob/gyn who runs the nonprofit contraceptive developer Medicines360. “Women can use birth control for 20 to 30 years—but we still are in a situation where they have to make significant tradeoffs.”

47 million

Daily hormonal pills can have side effects ranging from mood swings and nausea to increased risks of blood clots and cancer. IUDs have to be implanted by doctors, in sometimes painful (and usually unanesthetized) procedures. Condoms are cheap and easy to get, but they require trusting one’s partner to use them correctly. These imperfect choices help explain why 45% of all pregnancies are still unplanned—upending women’s lives, costing the government an estimated $21 billion in public spending every year, and contributing to a horrific U.S. maternal mortality rate that falls especially heavily on Black women.

Now that the Supreme Court has overturned Roe v. Wade, effectively banning abortion in at least 13 states and opening the door to national restrictions on medication abortion, increased access to all kinds of birth control is more important than ever. Yet the field is “constantly under-invested in,” says Gandal-Powers. It’s a familiar story in women’s health: Even though women make approximately 80% of health care purchasing decisions, and account for more than half the population, the (mostly male) investment community shies away from products seen as “niche.”

Today, Big Pharma has largely abandoned women’s health, spending only 1% of all R&D investment on female-specific conditions other than cancer. In birth control specifically, large companies have mostly stopped developing new products after seeing their profits sapped by cheaper generics.

It all adds up to a huge market of unsatisfied customers—ones that entrepreneurs like Pelletier are eager to serve. Since 2018, the FDA has approved new contraceptives including Evofem’s nonhormonal gel; Agile Therapeutics’ Twirla, a weekly patch with a relatively low dose of estrogen; TherapeuticsMD’s Annovera, a vaginal ring that can be used for up to a year; Mayne Pharma’s Nextstellis, a pill with a plant-based form of estrogen; and Slynd, an estrogen-free pill manufactured by privately owned Insud Pharma.

But this is where the roadblocks of health care economics loom large. It can take more than a decade and sometimes billions of dollars to get FDA approval for a new drug. The startups that have successfully broken into birth control don’t have the same financial cushions as their Fortune 500 brethren, to survive the years of navigating the regulatory labyrinth. “Large companies aren’t interested in women’s health—and small companies have a hard time commercializing,” says Annabel Samimy, a managing director and senior biopharmaceutical analyst at Stifel. And those that win approval find that they can’t actually sell their products at a profit, because insurers refuse to cover them, and women can’t or won’t pay out of pocket when flawed but cheaper options exist.

1%

Agile Therapeutics had to resubmit its Twirla application twice over a decade—and conduct a new set of trials—before it finally won FDA approval in 2020. All told, Agile spent about $250 million to get Twirla approved. “We won—but we came out of that broke,” recalls Agile CEO Al Altomari, a veteran of Johnson & Johnson’s women’s health business. “And we’ve never clawed our way back in the public market, because now we’ve got to face the insurance companies.”

It’s an all-too-familiar confrontation in the U.S. health care system: In the tug-of-war for profits between drugmakers and insurers, patients’ welfare is often lost in the middle. The ACA mandate should have sheltered contraception, and the women who use it, from this showdown—but insurers and their powerful pharmacy benefit managers (PBMs) are finding ways to avoid fully paying for what patients need. UnitedHealth Group, the nation’s largest insurer, is the worst offender, but most companies are dodging full compliance, according to industry executives, the House report, and dozens of Fortune interviews. “It’s incredibly frustrating—and it’s a detriment to the patient’s health,” says Dr. Daniel McDyer, an ob/gyn in Jacksonville, who says his office has to “jump through all kinds of hoops” to help patients get reimbursed for newer forms of contraception.

President Biden’s administration has issued guidance “clarifying” the law and has repeatedly called on insurers to fully comply. Now the administration “is actively investigating” reports of insurer noncompliance, Chiquita Brooks-LaSure, the U.S. Administrator for the Centers for Medicare and Medicaid Services (CMS), told Fortune in an emailed statement in late March. A source familiar with the investigations said that they include “audits into multiple insurers” and may eventually lead to enforcement or other “corrective actions,” such as fining insurance companies.

Any such crackdown would significantly help the 73 million U.S. women of reproductive age. But it may not come soon enough for the few companies that are actually investing in birth control. Those that have made it to market are struggling financially today: Mayne Pharma, the Australian company that took over TherapeuticsMD’s products and won FDA approval for its own Nextstellis pill in 2021, lost about $17 million on Nextstellis in its most recently reported six-month period; executives tell Fortune that they blame insurance coverage restrictions for its “slower than planned” sales. Agile, which has no products other than Twirla, lost more than $25 million last year; its stock is also trading for pennies and is on the brink of being delisted from the Nasdaq.

“When an entrepreneur comes to me and says they want to start a new women’s health care company,” Altomari adds, “I tell them, ‘Don’t do it.’”

Phexxi is a clear, thick, gel that comes in a white applicator that looks like a tampon and is used almost the same way. It’s made out of lactic acid, citric acid, and potassium bitartrate—food-grade ingredients that, the company and ob/gyns say, are less irritating than the chemicals in spermicides. An hour or less before she plans to have intercourse, a woman inserts the applicator into her vagina to deposit the gel, which keeps the vagina’s pH at its usual level and thus essentially immobilizes sperm. (Pelletier demonstrates her product by dispensing one applicator’s contents on the side of a plastic cup, where a thick inch of Phexxi sticks, impervious to her attempts to shake it off. It looks like a long squeeze of clear toothpaste.)

Evofem’s clinical trial found that Phexxi is 93% effective with “perfect” use, and 86% effective with “typical” use. That means that in practice, it’s less effective at preventing pregnancies than IUDs, which are more than 99% effective, or pills, at 93%; it’s closer to condoms, which are about 87% effective, and traditional spermicides, which are about 79%.

But Phexxi, like most new contraceptives, is much more expensive than those older products. A box of 12 one-time-use applicators can cost about $300 out of pocket, while monthly supplies of Twirla and Nextstellis can be more than $200.

That’s certainly not cheap for people without insurance, especially compared with a generic pill that costs $20 or less per month. But it’s pennies compared with the five-figure monthly sums commanded by some drugs in cancer or neurology—drugs that, in turn, generate far bigger profits. Small wonder, then, that few companies or investors bother to take up the drug-approval gauntlet for the relatively low returns on contraceptives.

Those few who emerge victorious must recoup their costs—and that’s where they hit the Big Insurance wall. Insurers (or “payers”) have a tremendous amount of power over which drugs patients get affordable access to, which they wield to keep their own costs down and profits up. They do so through the intermediaries called PBMs, which publish “formulary” lists of drugs they are willing to pay for and which have the purchasing power to demand discounts and rebates from manufacturers. (The three largest PBMs, which together control about 80% of the market, also own or are owned by large insurance companies.)

Small drugmakers have limited negotiating power—especially if they’re selling products like contraception, where there are already plenty of cheaper generics. What’s more, birth control is perceived to address a health condition “that is not life-threatening,” notes Sabrina Martucci Johnson, CEO of Daré Bioscience, a women’s health company developing a nonhormonal contraceptive for Bayer. “That makes it very easy for payers to put up hurdles and boundaries.”

40% to 60%

When the ACA was enacted, entrepreneurs and women’s health experts hoped it might break the logjam on contraceptive development. Starting in 2012, the ACA required insurers to cover women’s contraception at no cost to the patient, without a co-pay or cost-sharing. This mandate was theoretically “a huge, huge game changer,” according to Dr. Raegan McDonald-Mosley, an ob/gyn and the CEO of Power to Decide, a nonprofit focused on access to contraception. The ACA mandate meant, on paper, that doctors didn’t have to worry about the costs of whichever birth control proved right for their patients. This is especially important for lower-income women and women of color, who in general have less access to adequate health care and less ability to pay out of pocket for expensive brand-name contraception (and who are less likely to use hormonal pills). 

But in practice, insurers have avoided meeting their obligations. Which they admit: A majority of the nine largest U.S. insurance companies and pharmacy benefit managers (PBMs)—who together provide benefits to more than 260 million Americans—last year told the House of Representatives that they do not fully cover 50% of contraceptive products the FDA approved after 2011.

When an insurer refuses to cover a specific type of birth control, doctors can put in an “exception request”—a time-consuming process that multiple health care providers call “maddening”—but as the insurers told the House, those often get rejected, too. “The majority of companies surveyed reported denying an average of at least 40% of exception requests from individuals seeking coverage for contraceptive products from 2015 to 2021,” according to the report, conducted by the staff of then-Rep. Carolyn Maloney, who until January chaired the House Committee on Oversight and Reform. Prime Therapeutics, the PBM owned by Blue Cross Blue Shield, denied almost 80% of exception requests every year from 2015 to 2021, the report found. Optum Rx, the PBM owned by UnitedHealth, denied more than 60% of such requests from 2015 through 2020.

Insurers and PBMs last year rejected or refused to fully cover between 40% to 60% of patient claims for contraceptive products sold by Evofem, Agile Therapeutics, and Mayne Pharma, executives at those companies say. Pelletier adds that insurers have rejected 50,000 claims for Phexxi (or about half of all the prescriptions it’s sold).

In some instances, insurers ask that patients try and “fail” as many as nine other types of birth control before they will approve prescriptions for Phexxi or Twirla, according to several letters sent by insurers to customers and provided to Fortune. It’s not entirely clear what “failure” means in this context—but certainly, nine unintended pregnancies would be much more expensive for an insurer to cover than a course of brand-name birth control.

“I’ve had a lot of fun,” says Shannon Johnson, a 32-year-old medical devices salesperson who lives in the Los Angeles area. In October, a few months after giving birth to her first child, Johnson got her first prescription for Phexxi. After 16 years of using birth control pills, Johnson wanted to stop taking hormones, and was thrilled to learn that she and her husband could now use something other than condoms.

UnitedHealth, Johnson’s insurer, paid for her first month’s prescription. But when she tried to refill it, the claim was denied. Her doctor’s office contacted four different pharmacies, to no avail. UnitedHealth eventually told Johnson that it considered Phexxi to be the same as a generic, over-the-counter spermicide; if she really wanted the new product, she could pay $600 out of pocket per month.

Johnson’s ob/gyn is giving her Phexxi samples—but that’s a temporary fix. “The fact that I can’t get it through my insurance now is just incredibly frustrating,” she says.

Fortune reached out to all the insurers and PBMs mentioned in the House report and cited by our sources. All declined to make executives available for interviews, and most declined to comment on specific types of contraception or on findings from the House report or Fortune’s reporting. The exceptions were CVS Caremark, the largest PBM and the corporate sibling of insurer Aetna (both are owned by CVS Health); and Humana. A spokesperson said by email that CVS includes Twirla and Phexxi on its “no-cost preventative services list” and that those two products “are covered by Aetna with no cost sharing.” A Humana spokesperson said the insurer “takes issue” with some of the House report’s findings, and said that “99% of Humana members that requested contraceptive products in 2021 received their preferred birth control prescription.”

Most payers also provided wordy statements that reminded this reporter, at least, of trying to interpret a legalese-laden “explanation of benefits.” Each said, in essence, that they’re striving to comply with the ACA and that most of their patients’ contraceptive claims get covered. “Optum Rx has worked with our payer clients to help them comply with the ACA requirements and to meet the needs of members,” a spokesperson for UnitedHealthcare Group and Optum Rx said by email, adding that “approximately 90% of contraceptive claims for both Optum Rx and UHC are processed at $0 cost-share.” Similar statements came from Prime Therapeutics; Blue Cross Blue Shield and Elevance Health; and Express Scripts, the PBM owned by Cigna. (An Express Scripts spokesperson added: “If a doctor feels that Phexxi or Twirla is the best medical option for their patient, the coverage request is approved with $0 cost-share for the patient.”)

Part of the wiggle room in how insurers and PBMs interpret the Affordable Care Act has to do with an outdated FDA chart, known as the Birth Control Guide, which lists different birth-control methods, such as pills, IUDs, and spermicides. In 2015, the federal agencies responsible for enforcing the ACA told insurers that they “must cover without cost sharing at least one form of contraception in each of the methods.”

The FDA guide dates back more than a decade, and says it is “not meant to be a complete list of all available birth-control options.” The rules also tell insurers and PBMs that they’re supposed to fully cover any FDA-approved contraceptive that a patient’s doctor deems medically necessary. But so far, that guidance has apparently left payers with room to litigate what’s “necessary”—and to require doctors and patients to jump through paperwork hoops.

Over the past two years, the Biden administration has been paying increasing attention. In June, the federal departments responsible for enforcing the ACA—the “Tri-agencies” of Health and Human Services, Labor, and Treasury—warned insurers that they “may take enforcement or other corrective actions as appropriate.” Then, in January, the administration asked for public comments on coverage denials of contraception, as part of a broader set of proposed new rules on ACA access to birth control.

“We expect plans and issuers to meet these obligations and are actively investigating reports suggesting that plans may be failing to comply with this requirement,” Brooks-LaSure, the head of Medicare and Medicaid, said in an emailed statement in response to a detailed Fortune list of questions.

Brooks-LaSure did not say how soon federal agencies might take enforcement action. But contraceptive advocates and pharma executives say they don’t expect anything to change until insurers actually are punished for noncompliance. “The plan violations are so egregious, that it should be pretty obvious to the [government] that that they should take action as fast as they can,” says Gandal-Powers.

Given its financial difficulties, enforcement—if and when it comes—may be too late for Evofem.

Saundra Pelletier has spent most of her life thinking about birth control. After growing up in small-town Maine, she started moving across the country for sales jobs for G.D. Searle, manufacturer of the original birth control pill, now owned by Pfizer. By 2000, she was leading the company’s $250 million women’s health care division; then she jumped to Women First Healthcare, a specialty pharma company selling estrogen treatments for menopause. After a national health study linked such treatments to increased risks of developing cancer, the market for menopause drugs dried up, and Women First declared bankruptcy in 2004. Pelletier did stints in management consulting and executive coaching, but by 2009 she had found a way back to birth control: She was recruited to run Women Care Global, a nonprofit focused on expanding contraception access in the developing world.

She had also, unexpectedly, become a mother. Doctors had always told Pelletier she couldn’t get pregnant, and she had married with that understanding—but now she’s a happily divorced co-parent of a 15-year-old son. He’s one of her two great loves; meanwhile, boyfriends and fiancés have passed in and out of her life, never fully accepting that she will always put her child and her company first. “Every person I’ve ever dated has been like, ‘You’re too obsessed with Evofem,’” she says.

Like Pygmalion, Pelletier carved her second great love into being. In 2013, she was approached to consult for Evomed, a small women’s health company, that had spent years funding clinical trials for a nonhormonal contraceptive gel. The gel, then called Amphora, was in its Phase III clinical trial—usually the last step before a company formally applies to the FDA—and Evomed wanted Pelletier’s expertise figuring out how to sell it. Instead, she wound up taking over the product entirely, spinning it out from Evomed and in 2015 launching a new, for-profit entity called Evofem.

Even before Pelletier formally took over, the problems inherent in running a small pharma company surged out of the woodwork—sometimes tragically. Like most drugmakers, Evomed had contracted out its Phase III trial for Amphora to a third-party clinical research organization. But the CRO had conducted some tests outside the United States, a practice that usually draws FDA criticism—and as Pelletier was trying to salvage the data in 2014, the head of the CRO accidentally crashed his private plane into a house in Maryland, killing himself and five others.

Two years later, the FDA rejected Evofem’s test results. Pelletier spent the next three years raising money to conduct another trial and resubmit the application. “I am a hustler—not in a bad way,” she says. “I will look at every avenue possible, I will turn over every stone, I will run it down to the ground.”

In 2018, while she was scrambling to keep her business alive, Pelletier was diagnosed with breast cancer. She continued running Evofem, despite grueling chemo and four surgeries to prevent its reappearance by removing her breasts, ovaries, and uterus. But while Pelletier survived her brush with cancer, her company’s chairman was less fortunate. Thomas Lynch, a pharma veteran who ran Ireland’s largest hospital group, died of stomach cancer in April 2020. Because of COVID lockdowns, neither Pelletier nor any of her executives could travel to the funeral. So it was bittersweet when, seven weeks later, Evofem’s FDA approval finally came through.

Since there already existed an MS drug called Ampyra, the FDA wanted Evofem to rename Amphora. One of Pelletier’s finance employees suggested Phexxi—the “Ph” to indicate how the drug works; the “xx” to indicate that it was for women; and, of course, the overall rhyme with “sexy.”

Then Evofem had to figure out how to launch a brand-new product during a pandemic, when neither patients nor pharma sales reps were seeing doctors for routine visits. Even without lockdowns, getting doctors to try a new type of birth control “is really, really difficult,” says Dr. Elizabeth Garner, former chief medical officer of Agile. New contraceptives also have to make the case that they're a good alternative to IUDs, Garner says, adding: “It’s an excellent form of birth control—safe, highly effective, all that stuff—but many, many women don’t want an IUD.”

Many women do want more nonhormonal and low-hormone options, owing in part to concerns about potential long-term cancer risks and other health dangers associated with estrogen. And Phexxi isn’t the only new product trying to tap this demand.

Agile CEO Altomari, for example, volunteers that he sees Twirla partially as an effort to make up for his Big Pharma past. In 2002, while at Johnson & Johnson’s then-sizable women’s health division, he helped launch the Ortho Evra patch—the first hormonal birth control that women could wear on their skin, instead of swallowing daily pills. Then “we found that it was hurting women with estrogen,” Altomari says. “So I feel like on a personal level, I have some unfinished business here.”

More than 40 women died from causes linked to Ortho Evra; thousands more sued J&J over blood clots, heart attacks, and other health problems they suffered while using it. By 2008, the company had paid more than $68.7 million to settle hundreds of lawsuits, and the FDA had added label warnings that the patch contained up to 60% more estrogen than daily pills.

However hard he fights to commercialize Agile’s lower-estrogen patch, Altomari has a long way to go to replace his old product. J&J discontinued Ortho Evra in 2014, after the FDA approved a generic version called Xulane, from Viatris’s Mylan Pharmaceuticals. Xulane contains the same high estrogen dose (and the same warning label) as Ortho Evra. Still, in 2022, Mylan sold an estimated $277 million of Xulane—compared with $10.9 million in Twirla sales for Agile.

Twirla and Phexxi both launched in late 2020. Within a few months, sales reps for Agile and Evofem started hearing the same story, over and over, from doctors: They couldn’t actually prescribe either contraceptive. Their patients would get rejected at the pharmacy and be asked to pay out of pocket. At best, the insurer or PBM would kick the prescription back to the overworked doctor’s office, asking their staff to fill out “prior authorization” paperwork to verify that this specific product, and only this product, was medically necessary for the patient. In many cases, the drugmakers gave in and cut deals—offering rebates to the payers or coupons to the patients, so that patients could at least give them a chance. Those concessions helped more women try the new contraceptives, but they also cost Evofem and Agile cash they were quickly running out of. “If the plans had followed the rules, we would not be worrying about money,” Pelletier says.

By mid-2021, shares in both companies were slipping, as investors questioned their mounting losses. To boost Evofem’s sales, Pelletier chose to go big and consumer-facing—with a cheeky, aggressive marketing campaign.

“Welcome to my vagina.” In September 2021, Evofem launched a commercial showing Annie Murphy, Emmy-winning star of Schitt’s Creek, wearing gold lamé pajamas and reclining in a softly pink room. Within this inner sanctum, “I make the rules,” Murphy continued, throwing a packet of birth-control pills into a trash can. “And that means no hormones, because hormones just weren’t right for me.” The ad aired widely across Hulu and got Phexxi’s name in front of millions of millennial and Gen Z women. “I legitimately don’t know if we would have gotten that same uptick without an endorsement of a celebrity,” Pelletier says.

But the campaign also caused problems for Phexxi. Its language raised eyebrows about fearmongering over hormonal contraceptives in an anti-vaxxer era. It also gave the impression of glossing over Phexxi’s downsides—specifically, its lower effectiveness rate in preventing pregnancy—and implied that Evofem's product was better than hormonal methods on all counts.

Pelletier to this day defends the commercial. “We didn’t do it to confuse women,” she says. “We did it to say we’re different—and guess what, sometimes different is better.”

45%

Still, the marketing blitz couldn’t win over insurers—and it ultimately couldn’t boost sales enough to offset Evofem’s expenses. Pelletier had raised $50 million in debt in 2020 with the expectation that Phexxi sales would take off quickly. When they didn’t, and Evofem’s expenses and debts mounted, retail investors sent its stock plunging. By mid-2022, its shares had slipped below $1, and by August, they were officially delisted from the Nasdaq.

Pelletier had one more big bet up her sleeve: She had invested $45 million in another Phase III clinical trial, to prove that Phexxi could prevent chlamydia and gonorrhea as well as pregnancy. Earlier trials had produced promising results, and an expanded use case might have helped increase prescriptions and sales.

But the trial failed. In October, Pelletier laid off half of her remaining staff; by late March, Evofem had lost its chief financial officer, laid off its chief commercial officer, cut its remaining staff to 35, reduced salaries by 20% for everyone remaining, and chopped Pelletier’s salary by 40%, to $520,000. Pelletier even put out an official for-sale sign, announcing in February that Evofem is evaluating “strategic alternatives.” But finding a buyer may prove complicated; less than a week after that announcement, Rolling Stone published a story about several women who got pregnant while using Phexxi, and questioned whether it “should be on the market at all.”

These doubts could ultimately be the final blow to Evofem. They have, at least, given insurers another excuse to drag their feet on covering it. And if Phexxi turns out to be an also-ran contraceptive, insurance companies who blocked women from using it may have done an unintentional public service. But: emphasis on unintentional. “I think if the product was perfect, [insurers] would treat it exactly the same way,” says a senior executive at an Evofem competitor, which is also fighting health plans for better coverage.

Whatever happens to Evofem, it took two decades, hundreds of millions of dollars, and Pelletier’s fanatical commitment to get its product to market. There are very few companies willing to follow her lead—and if this generation of innovators fails, what happens to the next one?

“This product is great, and more women and providers need to know about it—even if they use it along with condoms or other methods,” says Dr. Lisa Rarick, an ob/gyn and former FDA official who joined Evofem’s board in 2020. “It’s a tragedy.”

During Evofem’s heyday, its offices reflected its CEO’s swaggering, somewhat Girlboss 1.0 persona: There was a “feminism” plaque in the cafeteria; conference rooms named after Ruth Bader Ginsburg and Rosa Parks; a shower in Pelletier’s office with an ode “to strong women” printed on its curtain.

But in February, I arrived at a white-walled ghost town. Pelletier’s remaining team had packed away the last of her decor in January, as Evofem had been lining up a deal to sublet the rest of its space; then the tenant dropped out. Even the famed bathroom had flooded: As Pelletier and I talked in the “Marilyn” conference room, plumbers traipsed in and out of the office, carrying a snake and buckets. Soon our conversation was punctuated by grinding noises and the whir of a fan in the hallway outside.

“We will do anything to survive outside of bankruptcy,” Pelletier says. On March 15, Evofem won shareholder approval to consolidate its shares in a reverse split. The company’s latest, bone-deep bloodletting will slash about $4.3 million of expenses, buying Evofem a few more months of operating budget—as long as it can keep boosting Phexxi sales. Maybe a bigger suitor or a deep-pocketed investor will come along. Ideally, Pelletier hopes to repeat how Evofem went public in 2017: find a publicly listed biotech company with some cash and a failed product, which can reverse-merge with Evofem and put it back onto the NYSE or Nasdaq.

But that’s a long shot, to say the least. Over the past two months, most of the investors, analysts, competitors, board members, and current and former employees I’ve spoken with have praised Pelletier’s passion, while effectively eulogizing her company. “I would love to see a bigger company acquire the assets,” says Dr. Kelly Culwell, Evofem’s former chief medical officer and now the head of women’s health R&D for Sebela Pharmaceuticals. “But I don’t know who that would be.”

Pelletier remains mostly undaunted. But occasionally she allows doubt to creep in. At the end of Valentine’s Day, I joined her and her longtime chief of staff for dinner at her local, an Italian restaurant where multiple workers came over to chat, and eventually gave us each a single red rose. Over martinis, New York strip steaks, and Caesar salads—the performance, at least, of a celebratory meal—Pelletier slowly reckoned with the possibility of losing one of her two great loves.

Her voice, as it often does when discussing her company’s prospects, cracks. This could be “the demise of Evofem,” she admits. “The wolves are at my door.”

A grant from the NIHCM Foundation helped fund reporting for this story.

A version of this article appears in the April/May 2023 issue of Fortune with the headline “The birth control market is broken.”

This story was originally featured on Fortune.com

More from Fortune: 

• 5 side hustles where you may earn over $20,000 per year—all while working from home

• Expert advice to keep your money safe during bank failures

• The young creators of a "TED meets Burning Man" conference bought a $40-million mountain. Years later, it's an unbuilt mess

• This is how much money you need to earn annually to comfortably buy a $600,000 home