Nigerian health tech startup Remedial Health which digitizes pharmacies and brings efficiency to the pharmaceutical supply chain, has raised $12 million in Series A equity-debt funding, with a mission to scale operations in the West African country, before expanding to the rest of Africa.
Founded in 2020 by Samuel Okwuada, a trained pharmacist and self-taught software developer, together with his co-founder Victor Benjamin, Remedial Health started as a private label business, focused on contract manufactured products from markets like India, which they would then sell to pharmacies in Nigeria.
Fintech VC firm QED Investors co-led the round, banking on embedded financial opportunities like payments, and lending in the pharmaceutical sector. This is QED’s third investment in Africa after its involvement in the Moniepoint (formerly TeamApt), and Flapkap deals last year. Ventures Platform, also co-led the round, which saw the participation of existing investors like Y Combinator, Tencent, and Gaingels.
In a recent report by Nigeria’s National Agency for Food and Drug Administration and Control estimates that about 15% of the medicine sold in the country is fake or sub-standard. Besides, it is estimated by the United Nations Office on Drugs and Crime, that half a million people die in sub-Saharan Africa owing to substandard or counterfeit medicine.
Okwuada commenting on the recent round said that priority at the moment remains on increasing penetration in 34 states by getting more pharmacies and hospitals signed up, especially in rural areas, where demand is growing.
“We are seeing more growth in rural areas, because they are difficult to reach, and are far from major open drug markets in Nigeria,” said Okwuada, adding that the startup currently has a “considerable market share” in at least half of the 34 of 36 states it operates in within Nigeria.
“We are a B2B business and we are able to provide inventory to these pharmacies without requesting cash up-front, or at the point of delivery… We’ve seen them grow their businesses, open additional branches because they are able to get credit,” said Okwuada.
Commenting on the investment, QED Investors partner, and head of Africa, Gbenga Ajayi said in a statement:
The success that Remedial Health has enjoyed to date is an indication of the market gap that exists, and their value 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.
