Despite India having more than eight lakh pharmacies, access to medication has been largely difficult for people. This became a challenge during the pandemic as timely availability of medicines proved to be an uphill task. As such, e-pharmacies that delivered medication to the doorstep turned out to be invaluable businesses. The biggest e-pharmacy start-up in India Pharmeasy became a unicorn in the year of the e-pharmacy industry, 2021. The company will soon be going public in an IPO listing planned for the Financial Year (2022-23).
Who is Pharmeasy?
Pharmeasy, founded by Siddharth Shah, is a subsidiary of API Holdings. An e-pharmacy firm, Pharmeasy is an Internet company headquartered in Mumbai. Their online pharmacy and medical store in India is quite popular. Pharmeasy is a diagnostics brand that gets medicines home delivered.
How did it become India’s largest pharmacy chain?
Pharmeasy became India’s largest online pharmacy chain after its acquisition of its peer, Medlife. After the acquisition, Pharmeasy covered every single pin code across the country and went on to serve over 2 million families per month. It also became the ‘largest healthcare delivery platform across the country by a distance’.
PharmEasy’s current valuation
PharmEasy is currently valued at $1.8 B and has entered the unicorn club of fast-growing start-ups. The current valuation occurred after venture capitalist ‘B Capital’ purchased a minority stake of $20 M in the firm.
How is it planning to go public?
Pharmeasy is currently IPO bound and is targeting an IPO in the coming 12-18 months. It is ready to list on the public exchanges. The firm’s parent company API Holdings is aiming for a listing worth $1-1.2 B and is also looking to achieve a valuation of $4 B from this listing. Pharmeasy is hopeful of a blockbuster IPO in Financial Year 2022 and had earlier shortlisted Investment Banks Morgan Stanley and Kotak Mahindra Capital as advisers for the listing.
Pharmeasy had also originally planned to file their DRHP (draft red herring prospectus) with SEBI (Securities and Exchange Board of India) in the August-September period this year and a possible launch in the January-March period next year. There are speculations that Pharmeasy was previously harbouring plans for a SPAC (Special Purpose Acquisition Vehicle) listing overseas but later settled for an India IPO.
Pharmeasy had also originally planned to file their DRHP (draft red herring prospectus) with SEBI in the August-September period this year and a possible launch in the January-March period next year.
What’s in it for me?
E-Pharmacy is one of the blessed industries that grew two-fold during the pandemic. In 2022, the E Pharmacy market is expected to grow at a CAGR of 63% and will touch $3657 M in valuation. If you are venturing into this space, you need to target mobile-first consumers and set up a robust digital payments’ infrastructure.
There are two kinds of e-pharmacy business models you can consider. One is the domestic ‘Genuine Internet Drug Store’ and the second is the non-domestic ‘Genuine Internet Drug Store’. The latter is based out of India but caters to the Indian market, is authorised by the Indian government, and follows the guidelines issued for the e-pharmacy business here.
Your e-pharmacy start-up can run on all or any one of the digital channels namely web portal, mobile app and website. You can tie up with medical stores and drug retailers to deliver valid prescriptions to customers’ doorsteps. To get started with your e-pharmacy, you will need an online presence. You also need to work on your digital inventory and invest in marketing campaigns to target customers from different locations. You will also need to invest in high-quality customer service as well as customer retention strategy since these are crucial for the success of an online pharmacy start-up.