Nigerian healthtech startup, DrugStoc has raised USD 4.4 million in Series A funding to expand access to quality medicines while providing sustainable supply chain financing for healthcare providers in Sub-Saharan Africa.
The funding round is led by Africa HealthCare Master Fund (AAIC), and other investors include Chicago-based venture firm Vested World and the German Development Bank (DEG).
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.”
Launched in 2017, DrugStoc is a cloud-based platform that provides healthcare providers with the interface for easy access to pharmaceuticals and healthcare products. It ensures that patients get quality medicines at affordable prices.
Having grown over the last three years with an almost 1500% increase in monthly sales since January 2018, 14 million people currently have access to genuine healthcare products through hospitals and pharmacies covered by DrugStoc. With this funding round, the company will grow coverage to about 100 million people. It plans to achieve this by expanding its supply chain infrastructure both digitally and physically. Digital expansion will see DrugStoc build out its tech solutions to boost access and accommodate more partners as it extends coverage beyond Lagos. DrugStoc will also build on its partnerships with financial institutions such as Sterling Bank, to increase access to sustainable supply chain financing.
Chibuzor Opara, DrugStoc’s co-founder and CEO; asserted that “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.
“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,” added Chibuzo Opara.
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 broken supply chain and chaotic distribution channels on the continent still pose a significant challenge. It affects the delivery of quality medicines, affordability of pharmaceuticals and efficient healthcare delivery for health workers. 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 is ensuring that more vital drugs, vaccines and health technologies are supplied safely, effectively and affordably to more people.
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.”
The healthtech startup will now double down on its vision to change the way healthcare providers interface with the pharmaceutical market and revolutionize sub-Saharan Africa’s access to quality pharmaceuticals.
In 2016, DrugStoc was incubated under Stanford’s Institute for Innovation in Developing Economies; and in 2019 made the shortlist as one of ten finalists for the Africa Netpreneur Prize Initiative, Jack Ma’s flagship entrepreneur program in Africa. It also won the award for the Technology Enabled Distributor of the year, at the Nigeria Health Excellence Award in 2019 and 2021.