OneHealth bets on PillFinda to deal with Nigeria’s drug shortages

Nigeria’s pharmacies and well being centres function in a notoriously fragile pharmaceutical provide chain. Important medicines repeatedly exit of inventory, and retail pharmacies typically rely upon a patchwork of open-drug markets, middlemen, and casual distributors to replenish stock. In consequence, Nigeria’s unavailability of important medicines at pharmacies sits at almost 65%, one of many highest in Africa.

On the similar time, the continent’s on-line pharmacy and B2B drug-procurement sector is rising, valued at over $560 million in 2022. Gamers like DrugStoc, Remedial Well being, and Pharmarun already anchor elements of this worth chain. But Nigeria nonetheless lags behind its friends in digital procurement adoption, leaving house for newer entrants to suggest alternate options to the long-standing distribution inefficiencies.

OneHealth, a Lagos-based on-line pharmacy and health-tech firm based in 2019, is a type of entrants. The corporate runs a direct-to-consumer (D2C) on-line pharmacy providing prescription success, telehealth, and power care assist. It claims to have served “tens of 1000’s” of consumers throughout a number of Nigerian states, and has step by step expanded into healthtech merchandise, together with a drugs subscription service and residential diagnostics. Now, the corporate says it needs to deal with the deeper structural challenges that constrain its client enterprise: the reliability and value of medicines.

Its new product, PillFinda, is a B2B procurement market that goals to provide pharmacies and hospital dispensaries entry to real-time stock knowledge, coordinated logistics, and a structured channel for sourcing important and hard-to-find medication.

“There have been difficulties the place pharmacies wrestle with drug procurement for his or her stocking, or perhaps they simply want medication which can be scarce or laborious to seek out,” Babatunde Oguntona, PillFinda’s gross sales supervisor, informed TechCabal. “Generally, they need to go to completely different producers or a number of distributors to have the ability to restock. However with this answer, what we are attempting to do is to make sure that entry to treatment end-to-end is being lined.”

Nigeria’s current procurement pathways make that ambition clear. Most pharmacies nonetheless depend on main open drug markets like Idumota in Lagos or Sabon Gari in Kano, the place costs shift each day with FX swings, and high quality management is inconsistent. Others rely upon regional wholesalers who lack digital methods, forcing pharmacists to spend hours calling a number of suppliers. Most time-pressed pharmacies outsource sourcing to casual procurement brokers, typically at a markup.

PillFinda makes an attempt to simplify this course of by permitting pharmacies to browse out there inventory, place orders digitally, request merchandise, and observe deliveries by way of OneHealth’s logistics arm, PillMova. “If you happen to’re searching for a selected model or product that you just can’t discover on the platform, you make a request and add the identify and actual image, and we’ll supply it for you,” Victoria Ifeonye, the platform’s product supervisor, defined.

However the B2B drug-distribution market is already crowded and extremely aggressive.

DrugStoc, one of many sector’s strongest incumbents, runs a licenced supply-chain community for pharmacies and hospitals in Nigerian states; Remedial Well being offers stock, software program, knowledge and financing options to healthcare suppliers in Africa; and Pharmarun aggregates pharmacy inventories for shoppers and companies. These platforms rely closely on licensed distributors and, in some circumstances, run their very own micro-distribution hubs, providing aggressive pricing by way of negotiated bulk agreements.

In comparison with these firms, PillFinda doesn’t but function large-scale warehousing or a nationwide community of distribution hubs. Oguntona says the platform’s differentiation lies in tighter logistics integration and deeper knowledge monitoring. PillFinda can monitor shopping for patterns and predict when a pharmacy is prone to run out of fast-moving merchandise. That knowledge, he stated, permits for proactive restocking: “We are able to perceive their shopping for sample, what they buy typically, after which counsel when it’s time to restock,” he stated.

Nigeria’s pharmaceutical market is price-sensitive on account of international change and tax. To maintain pharmacies financially afloat, PillFinda incorporates a credit score system that enables pharmacies to purchase now and pay later, inside managed, monitored limits.

“We give pharmacies a credit score system,” Oguntona stated. “However we monitor their credit score behaviour, so we don’t give past what they’ll deal with. That helps us keep worthwhile whereas supporting them.”

PillFinda’s pricing mannequin sits on conventional wholesale margins. The platform buys from producers and licenced distributors, applies a markup, and sells to pharmacies. However as a result of drug costs in Nigeria fluctuate with international change and import prices, OneHealth says it adjusts costs regularly primarily based on provider prices. The corporate additionally expects to earn from its credit score system, providing short-term financing to pharmacies however capping limits primarily based on compensation behaviour to scale back danger.

But, the platform faces the identical obstacles which have constrained others within the sector:  Logistics prices stay excessive nationwide, regulatory compliance is complicated, and lots of small pharmacies are sluggish to undertake digital instruments. “We work with the Pharmacy Council of Nigeria (PCN) as properly to make sure that we’re clearly complying with all of the legal guidelines and rights of treatment provides,” Ifeonye stated.

That technique helps maintain product costs steady for pharmacies but in addition suggests PillFinda remains to be constrained by the identical market realities as different platforms, significantly these with out unique producer partnerships or giant warehouse capability. Gamers with deeper supply-side leverage are inclined to form pricing; others should react to it.

“We at the moment have one other problem with value margins with rivals,” Ifeonye acknowledged. “ However how we’re fixing that’s that we modify pricing primarily based on our provider prices, as a result of we search for cheaper suppliers that give us treatment at a really reasonably priced fee.”

Regardless of these constraints, OneHealth views PillFinda as greater than an extension of its client enterprise. The corporate goals to develop its distribution capabilities throughout West Africa and ultimately construct what it hopes will turn out to be a regional pharmaceutical supply-chain engine. For now, OneHealth’s transfer indicators an intention to play within the deeper layers of pharmaceutical infrastructure. The query is whether or not it might construct sufficient scale to shift the system slightly than merely navigate it.