Lifestores Healthcare secures $3M pre-series A round to expand across Nigeria
Nigerian healthtech company, Lifestores Healthcare has closed a $3 million pre-series A round led by Health54
By 2030, Africa’s $45 billion pharmaceuticals market is expected to grow by 10% CAGR to $100 billion. Yet, the sector struggles with highly fragmented and undercapitalized supply chains rife with fake medications, which cause the death of thousands of patients each year.
In Nigeria, 13 to 15% of medications are counterfeit, according to the National Agency for Food and Drug Administration and Control (NAFDAC). Founded in 2017 by Bryan Mezue, Ken Ahaotu, a pharmacist, and Andrew Garza, Lifestores Healthcare, a Nigerian healthtech company originated as a chain of retail pharmacies before launching its OGApharmacy service in 2020.
Lifestores is building out its full stack of technology in-house, using its experience as a retail pharmacy operator to beta-test new software. With a shortage of doctors, nurses and hospitals, for Nigerians, like in many other African countries, neighbourhood pharmacies play an overwhelmingly key role as their primary point of contact with the local healthcare system.
To drive its technology and mission, Lifestores Healthcare has closed a $3 million Pre-Series A funding round. The round was led by Health54, the healthcare-focused corporate venture capital arm of CFAO Group, with Aruwa Capital Management as a supporting lead, along with participation from other existing investors. The round which was oversubscribed by 50%, according to a statement seen by Benjamindada.com.
"Our scope goes beyond merely distributing medicines and stabilizing prices. Essentially, pharma wholesalers are the ‘banks’ of the healthcare supply chain in Nigeria, and their impact on the overall economy is considerable. By optimizing how we extend credit to our healthcare provider partners and modernizing patient access to health financing, we are able to power the growth of our partners and increase patient access to quality care," Andrew Garza, COO & Co-founder of Lifestores Healthcare, said.
With this investment, Lifestores will expand across Nigeria, improve its software capabilities, and reach new customer segments. To achieve the aforementioned, the company will expand its sales and engineering teams, as well as its senior management.
Lifestores operates an online B2B pharmaceutical marketplace, OGApharmacy, which provides pharmacies with 10-20% group discounts, cutting-edge supply chain software, and the confidence that medications are authentic and not dangerous counterfeits. Experiencing a 25% monthly marketplace growth to date, OGApharmacy counts more than 10% of Nigeria’s pharmacies as registered customers.
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Lifestores aims to increase the number of OGApharmacy customers from 10% to 25% of Nigeria’s total market share, increasing the number of patients reached by 4x from 100,000 to 400,000 by 2023. To drive growth, Lifestores will open a new Lagos processing center and 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.
Additionally, Lifestores will leverage CFAO Healthcare’s existing wholesale distribution capabilities in Nigeria and across Africa as well as Health54’s increasing network of health services innovators and providers. Lifestores will also expand its B2C services, with pilots in patient savings, care management, and medication delivery.
"We are thrilled to have Health54 join our mission of democratizing access to quality and affordable primary healthcare in sub-Saharan Africa, together with existing investors, such as Aruwa Capital and the Lionbear consortium," said Bryan Mezue, Co-founder & CEO of Lifestores Healthcare. "The vast majority of Africans will visit their local pharmacy for treatment. We aim to support pharmacists, the unsung heroes of African healthcare, with the critical services they need to procure and provide safe and affordable medications to their patients."
“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,” according to Côme Vercken, Managing Director, Health54.
Lifestores embodies Health54 core mission by enabling operators to provide stable access to reliable and affordable medical supplies and services to patients in Nigeria. Health54 is committed to promote innovative solutions and to act a business partner leveraging the largest African healthcare network to support its investees' scaling up.
"Following an initial investment 18 months ago, we have been impressed with Lifestores’ stellar growth rate and are proud to continue to support this hardworking team, providing market-relevant solutions. In line with Aruwa’s gender lens strategy, approximately 50% of the pharmacies on OGApharmacy, are owned or led by women. We look forward to Lifestores’ continued success and are excited about the new strategic partnership," Adesuwa Okunbo Rhodes, Founding Partner and CEO, Aruwa Capital Management, said.