mPharma, a Ghanaian healthcare startup, acquired a controlling stake in Uganda’s Vine Pharmacy for an undisclosed amount, marking the company’s entry into its latest market in Africa.
mPharma revealed to TechCrunch that it had acquired a 55% stake previously held by the Abraaj Group, a private equity firm that collapsed after investors, including the Bill and Melinda Gates Foundation, sounded an alarm over its administration. $ 1 billion health fund. Abraaj bought Vine Pharmacy in 2013 when it was the largest pharmacy chain in Uganda.
The Vine Pharmacy acquisition comes two years after the healthcare startup bought Kenya’s Haltons Pharmacy for $ 5 million, marking mPharma’s foray into the East African region.
“Vine was the largest pharmacy chain in Uganda. At its peak, it had around 36 stores spread across the country. But with Abraaj as the main shareholder, the company had to downsize once there was no more capital available for growth. We are buying Abraaj’s stake, ”mPharma co-founder and CEO Gregory Rockson told TechCrunch.
Rockson said he hopes to bring Vine Pharmacy to its former glory, when it held the position of the largest retail pharmacy chain in Uganda. Vine Pharmacy had 20 branches across Uganda when Abraaj hired and embarked on an aggressive growth plan that involved doubling its branches by 2018, a feat it accomplished until the PE collapsed which led to the closure of several outlets. Abraaj also expanded the pharmacy’s wholesale business, provided government agencies and health care institutions, and expanded to include personalized patient care through home visits.
mPharma was originally founded in 2013 by Rockson, Daniel Shoukimas and James Finucane to manage the inventory of prescription drugs for pharmacies and their suppliers. It currently operates retail pharmacy businesses and provides market information to hospitals, pharmacies and patients.
It remains one of the well-funded startups in all of Africa, raising over $ 50 million since its inception, including a $ 17 million Series C round, led by CDC Group, the UK’s development finance institution, last year. Other existing investors include Silicon Valley backer Jim Breyer of Breyer Capital, Shravin Bharti Mittal of Bharti Global Limited, Social Capital and Golden Palm Investments. It also enjoys the support of Helena Foulkes, former president of CVS, the largest retail pharmacy chain in the United States, and Daniel Vasella, former CEO and president of Novartis; both are members of the board.
“I can tell you that Vine is a very profitable pharmacy chain. It’s been a family business for nearly 30 years, so we’re really looking to use this moment to scale the business, ”said Rockson.
“It’s a really exciting time for us and luckily Uganda is an exciting market. They may be about five years behind Kenya, but we think it’s ripe for innovation and disruption, ”he added.
mPharma recently announced that it was implementing telemedicine services across its pharmacy network across the continent in its efforts to bridge the gap between doctor and patient by providing all-inclusive services. It plans to use its pharmacy network to build what it describes as a digital primary care service that will offer all-in-one diagnostic services.
Earlier this year, mPharma entered Ethiopia after entering into a franchise agreement with Belayab Pharmaceuticals through its subsidiary, Haltons Limited. The Ethiopian pharmaceutical company is part of the Belayab Group, a franchisee of companies such as Pizza Hut and Kia Motors, in the country.
mPharma plans to continue its franchise model as it expands into new markets. This, Rockson said, will help the startup focus more on building and refining its infrastructure for a seamless supply and distribution system that would address the challenges the pharmaceutical market faces across Africa, including supply chains. unpredictable supply, exorbitant prices and low orders.
Last month, mPharma launched operations in Gabon after the West African country commissioned it to build a drug supply chain infrastructure, increasing the startup’s footprint in supplying pharmaceutical systems and distribution networks. across the continent. Ghana, Nigeria, Kenya, Zambia, Malawi and Rwanda are the other markets in which the tech startup operates.
The company also partnered with Mt. Meru Group, a service station operator in Rwanda, last November to open pharmacy branches within its stores.
“In less than a year, we were able to quickly build the largest retail platform in the country. Today, Rwanda is a very promising market for us, “she said.
The African pharmaceutical market is expected to grow exponentially as the population grows, thus providing a space for innovation and a market for startups offering mobile healthcare solutions.
Across Africa, Deloitte says in a report, East Africa is the most promising region in terms of health investment due to its integration and growing economy, supported by various sectors, including agriculture and tourism. . Rising demand for services and products as consumers gain greater spending power will also lead to increased healthcare and telecommunications spending, the report said, opportunities that mPharma hopes to exploit.