Nigeria’s health tech startup, DrugStoc, has announced it has raised USD 4.4 Million in Series A funding. The round was led by Africa HealthCare Master Fund with participation from other investors including Chicago-based venture firm Vested World and the German Development Bank (DEG). CardinalStone Partners Limited acted as Financial Advisers to DrugStoc.
Founded in 2017 by Chibuzo Opara and Adham Yehia, DrugStoc describes itself as a cloud-based platform that provides healthcare providers with the interface for easy access to pharmaceuticals and healthcare products. The company says it ensures patients get quality medicine at affordable prices and boasts of superior control systems with ISO certification on good distribution practice.
In the last three years, the company says it has experienced a 1500% growth in monthly sales since January 2018. The company says that 14 million people currently have access to genuine healthcare products through hospitals and pharmacies covered by DrugStoc.
With the latest funding round, the company plans to grow coverage to 100 Million people. The company says it plans to achieve this by expanding supply chain infrastructure both digitally and physically. Digital expansion will see DrugStoc build its tech solution to boost access and accommodate more partners as it extends coverage beyond Lagos. The company says it will also build on its partnerships with financial institutions such as Sterling Bank in order to increase access to sustainable supply chain financing.
DrugStoc was incubated under Stanford’s Institute for Innovation in Developing Economies in 2016. In 2019, it made the shortlist as one of the ten finalists for the Africa Netprenuer Prize Initiative. That same year, it won the award for the Technology Enabled Distributor of the year at the Nigeria Health Excellence Award. It has also won the same award this year.
It is predicted that Africa’s pharmaceutical industry will be worth $56 billion to $70 billion by 2030, from just $5.5 billion in 2007. However, the current supply chain and distribution channels on the continent still pose a significant challenge. It affects quality, affordability, and efficiency in healthcare. Innovation to solve supply chain challenges is a key opportunity in this growing market.
Based on estimates from the United Nations Economic Commission for Africa (UNECA), Africa imports about 94% of its pharmaceutical and medicinal needs from outside the continent. Drugstoc says it is ensuring that more vital drugs, vaccines and health technologies are supplied safely, effectively and affordably to more people.
Comments from Founders and Investors of DrugStoc:
Nobuhiko Ichimiya, Director at AAIC stated that, “We are very excited to be part of the Drugstoc journey. The pharmaceutical market in Africa has enormous growth potential and we are glad to back a company well-positioned to be a key player in the sector’s growth in sub-Saharan Africa.”
“We are committed to making an impact in the healthcare industry. This funding will enable us to expand and launch our tech-enabled products in more African countries where pharmaceuticals are critically needed” Chibuzor Opara, DrugStoc’s co-founder and CEO said. “Fragile and resource-challenged healthcare systems require a radically transformative set of market-based strategies to expand access to healthcare. The DrugStoc way re-engineers the value chain digitally, improving and expanding access to healthcare at the same time.”
According to Liam O’Connor, who is also among a group of individual Silicon Valley investors, “DrugStoc has demonstrated impressive growth and the ability to improve healthcare providers’ access to pharmaceuticals in Nigeria. I am excited to support DrugStoc’s innovative work building a reliable, resilient, and high-quality pharmaceutical supply chain across Africa. I am confident that DrugStoc will succeed in making a critical healthcare difference that will help save lives.”