NIGERIA – DrugStoc, a e-health drug procurement platform that eliminates pharmaceutical supply challenges by linking drug companies with institutions such as hospitals and pharmacies in Nigeria, has closed a US$4.4 million series A funding.
DrugStoc is currently on an aggressive expansion plan to deliver quality pharmaceutical products to 100 million people within Nigeria. The startup plans to expand into 16 states within Nigeria as it moves to grow beyond Lagos, the economic hub of the West African country. This is besides its more grandiose plan of venturing outside Nigeria into other markets within Africa.
The pharmaceutical supply chain across Africa has for decades remained fragmented leading to sourcing and distribution challenges as well as quality concerns; as fake and substandard products flood the market. Yet, these issues facing the supply chain are fixable.
Availability of high-quality pharmaceutical products, even within Nigeria alone, means averting thousands of preventable deaths — like the loss of life linked to blood-loss during childbirth, or of children succumbing to diarrheal diseases.
DrugStoc’s funding round was led by Africa HealthCare Master Fund (AAIC). Other investors include Chicago-based venture firm Vested World, the German Development Bank (DEG) and high-net worth individuals with a keen interest in tech-health.
“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 that is well positioned to be a key player in the sector’s growth in sub-saharan Africa,” said AAIC director, Nobuhiko Ichimiya.
Drugstoc was founded in 2015 by Opara and Yehia, but its history dates back to 2010 when the duo founded Integra Health, a hospital management company based on Yehia’s master’s degree project. The two entrepreneurs first met as students at the Maastricht University in Holland.
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.
In response, the co-founders 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 tact in 2017, when DrugStoc was officially launched, to include distribution, after a year-long incubation at Stanford’s Institute for Innovation in Developing Economies.
DrugStoc currently links 400 manufacturers to 3,200 doctors, hospitals and pharmacies. Opara says that the platform’s monthly revenues have grown over 1,500% in the last three years; a demand brought by the quality assurance that comes with DrugStoc’s platform. The startup earns a commission for every sale made.
In 2019, DrugStoc won a share (US$65,000) of the of the inaugural US$1million 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 market.