Lifestores Healthcare Will Be Expanding Its Pharmaceutical Marketplace Across Nigeria, After Raising $3 Million in A Pre-Series A Round

Healthtech companies have appeared to mitigate problems such as a highly fragmented and undercapitalized supply chain saddled with fake medications which cause thousands of patients’ death annually. In Nigeria alone, 20 to 40 percent of drugs in the market are fake. The growth potential of Africa’s pharmaceuticals market is quite huge; it is expected to grow 10 percent CAGR to $100 billion by 2030. Startups like Lifestores Healthcare have emerged to both bring efficiency to the pharmaceutical supply chain problems in Nigeria and to leverage the opportunities existing in the sector. 

In countries like Nigeria, pharmacies remain the fastest and cheapest way to access healthcare, even though this creates the problem of self-diagnosis among patients. The country is sadly saddled with an underfunded and underdeveloped healthcare sector, hence Nigerians tend to turn to pharmacies for their medical problems. This has led to the prevalence of fake medication in Nigeria, as original ones may be considered too expensive and sometimes hard to obtain by patients and even some pharmacies.

Lifestores Healthcare has secured pre-Series A funding of $3 million in an oversubscribed round led by Health54. The round also saw the participation of existing investors and Aruwa Capital Management as a supporting lead. The funding round follows a $1 million seed round that took place in 2020. The startup was founded in 2017 by Bryan Mezue and Andrew Garza who had held pharmacy and supply chain-related roles before launching Lifestores. The startup was, therefore, launched as a chain of retail pharmacies using technology to provide various pharmaceutical services. 

Lifestores Healthcare entails two B2B components. The first, called OGApharmacy, was launched during the pandemic in 2020 and allows pharmacies and hospitals to compile their purchasing needs. Lifestores in turn helps them to acquire these pharmaceutical needs directly from suppliers at the lowest possible price. This way, Lifestores Healthcare provides original, high-quality drugs and cuts between 10 to 20 percent of cost. The other component is an ERP system that pharmacies and dispensaries can use to run their operations.

The startup’s services are provided via a network of over 750 outlets. The startup claims to be having a 25 percent monthly marketplace growth, and more than 10 percent of Nigeria’s pharmacies as customers under its wings. The plan is to increase this number to 25 percent by 2023, which will increase the number of patients reached from 100,000 to 400,000.

“The number of patients who have loyalty accounts with us is growing by double digits every month. And then we also think a lot about the scale of impact we have through the pharmacies we don’t own but support through our software. And then, we indirectly touch over 200,000 patients from our software and the services we offer to those pharmacies. As of today, those are the ways we think about our patient impact. We’re also on the verge of launching several B2C initiatives and some cool features that are more direct to the patient,” CEO Bryan Mezue said.

The startup plans to open a new processing center in Nigeria’s economic hub; Lagos to drive growth. In a statement it released, the startup said that it will also launch new technology features as part of its B2B  offerings, including pharmacy management software, AI-driven predictive ordering, advanced credit offerings, and patient management initiatives. There are also plans to expand its B2C services and the startup will be focusing on areas such as patient savings, care management, and medication delivery.

Health54’s investment in Lifestores Healthcare is its first in Africa. “We’re proud and happy to make our first investment with Health54 in Nigeria and in Lifestores. We were impressed with Bryan and Andrew’s on-the-ground experience of having run multiple retail pharmacies in Nigeria. In two years, they have built a first-rate distribution platform with OGApharmacy. As a strategic partner, we’re delighted to work together and bring the benefits of our vertically integrated pharmaceutical supply chain so we can support more patients in Nigeria and beyond with quality primary healthcare,” Côme Vercken, Managing Director, Health54, said on the investment.