Nigeria: QED Investors and Ventures Platform lead $12m healthtech funding round
Remedial Health, a healthtech startup that develops solutions to make Africa’s pharmaceutical value chain more efficient, has secured $12 million in an equity and debt funding round to deepen the penetration of its offering in Nigeria and support the delivery of targeted financial services to drive business growth across the country’s pharmaceutical sector.
The $8 million Series A equity funding round was led by US-based venture capital firm, QED Investors and co-led by Ventures Platform, which have now invested in Remedial Health at every funding round since the pre-seed stage. Y Combinator, Tencent and Gaingels also invested after participating in previous rounds. The $4 million debt funding was led by a consortium of local and international financial institutions.
Across Africa, 85% of retail medicine purchases happen at micro-enterprises, typically neighbourhood pharmacies and and proprietary patent medicine vendors (PPMVs). For store owners, 90% of their wholesale purchases happen in open markets that are largely unfit for consumables and medicines. Store owners also have to endure expensive and time-consuming weekly order cycles that typically amount to two working days to access the inventory they need to stock their shelves. These realities, combined with a predominantly paper-based approach to managing operations, present various challenges that make it difficult to maximise profitability.
Remedial Health operates at the intersection of healthcare, supply chain management, technology and financial services, delivering the digital procurement infrastructure to power effective healthcare distribution for Africa’s 1.2 million pharmacies. Starting in Nigeria, Remedial Health has built an operating system for pharmaceutical buyers and suppliers, working with more than 300 manufacturers and serving more than 5,000 hospitals, pharmacies and PPMVs across 34 of Nigeria’s 36 states.
Store owners can access more than 8,000 vetted products via the mobile app, with same-day delivery and inventory financing to minimise cash-flow friction for routine orders and maximise sales opportunities. The startup also provides facility financing, payment solutions and inventory management solutions that makes it easier for store owners to run their business more efficiently and profitably. For pharmaceutical manufacturers, Remedial Health provides a route-to-market for their products, as well as data-driven insights into local markets that can be leveraged for more effective planning and decision making.
Gbenga Ajayi, head of Africa at QED Investors said, “The success that Remedial Health has enjoyed to date is an indication of the market gap that exists, and the value they provide in providing effective holistic services to thousands of pharmacies across Nigeria. QED is particularly excited about the embedded financial services opportunities within the vertical – the ability to provide payments, embedded lending and other fintech solutions to this underserved but very crucial sector. The Remedial Health team is perfectly positioned to solve this problem because of its unique positioning as a partner across the entire pharmaceutical value chain and the unique backgrounds of the founders as both seasoned phama operators and technology professionals. We are very excited to be on this journey and to support this next phase of the company and to bring our fintech DNA to bear in what is an already positive growth journey.”
Kola Aina, founding partner of Ventures Platform said, “We are incredibly proud to have been part of Remedial Health’s journey since the earliest phase of the company’s development. This partnership exemplifies our mission to support category leaders before they become obvious. Remedial Health’s dedication to improving Nigeria’s pharmaceutical value chain is critical and their success in securing this $12 million funding demonstrates their remarkable growth and the management’s tenacity over the years. Our investment in this round represents our continued belief in their mission to deliver financial services to neighbourhood pharmacies and drive deeper growth in the pharmaceutical sector.”
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