DrugStoc raised $4.4 million in funding to help it grow its business
DrugStoc raised $4.4 million in funding to help it grow its business
Pharmaceutical technology startup DrugStoc has raised $4.4 million in a Series A funding round to expand its operations in Nigeria. The funds will be used to expand its operations in the country. The Jack Ma Foundation awarded the company $65,000 as part of the inaugural $1 million Africa Netpreneur Prize Initiative, which was launched in 2019 and funded by the Jack Ma Foundation.
Aside from that, it has received an undisclosed grant from Bill and Melinda Gates, as well as seed funding from VestedWorld Capital.
In addition to Africa HealthCare Master Fund (AAIC), which was a repeat investor, and the German Development Bank, the Series A financing round was led by Vested World, a new investor (DEG). Private individuals also contributed to the total amount raised in the round.
DrugStoc was established in 2017 by Chibuzor Opara and Adham Yehia. It is a procurement platform that allows medical practices to procure all medications, consumables, and small medical devices on a single platform, according to the healthtech startup.
It was with great excitement that Nobuhiko Ichimiya, director of the Africa HealthCare Master Fund (AAIC), announced the investment.
Co-founder and CEO of DrugStoc Chibuzor Opara stated that the funding will allow the startup to expand and launch its tech-enabled products in additional African countries where pharmaceuticals are in desperate need of being introduced.
Connecting manufacturers with distributors
IntegraHealth, the hospital management company founded by Opara and Yehia, was the genesis of DrugStoc. Based on their own statements, the founders claim they identified gaps in the pharmaceutical industry's supply chain in Nigeria and set out to fill them.
They then created a technology-based platform for pharmaceutical manufacturers to connect with distributors, which they called PharmaConnect. The DrugStoc platform was officially launched in 2017 after a year of incubation at Stanford University's Institute for Innovation in Developing Economies.
Rather than acting as a middleman between manufacturers and distributors, the startup now purchases directly from manufacturers and distributes to healthcare facilities and pharmacies nationwide. Aside from that, they have a channel that helps pharmacies grow their businesses by providing them with collateral-free loans.
As of right now, DrugStoc connects 400 manufacturers with 3,200 physicians and pharmacists through its online marketplace. With each sale, the startup earns a commission, and they have dispensed over 9 million prescriptions for their products to date.
It has been three years and more than 1500 percent since the platform's monthly revenue has increased by more than 1500 percent, according to the CEO. It is because of the anti-counterfeit guarantee that is included with their products, according to him.
Meeting the pharmaceutical needs of 100m Nigerians
In Nigeria, DrugStoc plans to use the new investment to expand its reach to 100 million people by the end of the year, a tenfold increase from the current 14 million people they serve.
As part of the plan, the company intends to expand into 16 Nigerian states outside Lagos, as well as to establish additional fulfillment centers as well as to increase the number of transit points and routes. Also on the agenda is the expansion of logistical options to better serve last-mile deliveries.
Additionally, DrugStoc reports that it is establishing relationships with financial institutions in order to broaden access to long-term supply chain financing for pharmaceutical companies. To ensure the safe distribution of perishable products, additional investments in cold chain infrastructure are being planned as well.
Additionally, DrugStoc intends to expand its operations outside of Nigeria in the coming years.
With the pharmaceutical industry in Africa expected to reach a value of $70 billion by 2030, the healthtech startup will now step up its efforts to transform the way healthcare providers interact with the pharmaceutical market and revolutionize access to high-quality pharmaceuticals in Sub-Saharan Africa.
