A Nigerian e-health pharmaceutical distribution startDrugStoc Secures $4.4 Million Funding Round.
Chibuzo Opara and Adham Yehia, the co-founders of DrugStoc, a tech-based pharmaceutical procurement platform. Image Credits: DrugStoc
Mtemdoo Gbagyo –
Information available from Nigerian Investment Promotion Commission revealed that a Nigerian e-health pharmaceutical distribution startup, DrugStoc has secured $4.4 million in a Series A funding round led by Africa HealthCare Master Fund, Chicago-based venture firm Vested World, German Development Bank (DEG) amongst others.
The e-health drugs procurement platform was born out of a hospital management company IntegraHealth, founded by Chibuzo Opara and Adham Yehia in 2015.
According to Opara, the platform’s monthly revenues has grown over 1,500% in the last three years, a demand brought by the quality assurance that comes with DrugStoc’s platform and they earn a commission for every sale made.
DrugStoc currently links 400 manufacturers to 3,200 doctors, hospitals and pharmacies, a report sighted by NIPC Intelligence states.
“When we started, I don’t think we ever had a doubt about the demand because we understood the scope of the problem. We understood that people were fed up with the status quo,” said Opara.
“It’s the fact that we are transforming not just convenience and access but also paying great attention to quality which every healthcare professional at the end of the day is bothered by, that is the underlying drive in a lot of healthcare facilities or pharmacies.”
Further information made available by techcrunch.com further reveals that the duo founded their first company, Integra Health, which was initially contracted to manage 20 hospitals, and during which time the gaps in Nigeria’s pharmaceutical supply chains became apparent
The co-founders had earlier on created and piloted a tech-based platform in 2015 linking manufacturers with distributors. This plan failed to take-off as it immediately became clear that a platform alone would not suffice. The twosome changed tack in 2017, when DrugStoc was officially launched, to include distribution, after a year-long incubation at Stanford’s Institute for Innovation in Developing Economies.
“I think we came out of Stanford with a better understanding of business modeling and value chains than we understood it as a pilot phase,” said Yehia about the incubation program.
“We decided we need to get a distribution license, and to do this the pharmaceutical way. And to do this the proper way, we needed to buy directly from the manufacturers and create the value chains internally,” he said.
In hindsight, Yehia noted that the tech infrastructure alone would not have solved the fragmentation problems in the pharmaceutical distribution, as they now know the important need for strategic infrastructure like fulfillment centers — warehouses from where orders are processed, packed and shipped — and customer support units.
In 2019, DrugStoc won a share ($65,000) of the of the inaugural $1 million Africa Netpreneur Prize Initiative by the Jack Ma Foundation, a pitching competition that rewarded 10 enterprises providing solutions for the continent’s critical issues. They are also recipients of a grant from Bill and Melinda Gates, and also received seed funding from VestedWorld, an early-stage investment fund with a focus on sub-Saharan markets.
And now, with new funding, DrugStoc is expanding its coverage to more regions through more fulfillment centers and expanded transit points and routes, providing better logistic options for last-mile deliveries. It is also building partnerships with financial institutions to increase access to sustainable supply chain financing. This is in addition to plans of more investments in cold chain infrastructure to enhance the safe distribution of perishable products.
