Remedial Health: Optimizing Pharma Procurement in Sub-Saharan Africa
Godwin Amema is a 40-year-old father who runs a community pharmacy in Ojodu Berger, in Nigeria. His retail pharmacy has been operational since 2016 and serves 900 people a month, giving them access to essential over-the-counter and chronic care medication for health complications like diabetes.
To guarantee consistent and uninterrupted drug supply for his customers, Godwin personally scours the market to find and purchase necessary SKUs from different suppliers. The challenge is that sourcing options and outcomes vary each time. Price and accessibility would change on a monthly or even weekly basis depending on a number of factors including whether he has the time to visit the open source market, if there were strikes along the supply chain or disruptions at the port or even in his personal cashflows.
Nigeria’s pharmaceutical industry is laden with inefficiencies. Combined with a lack of digitization and poor infrastructure, the presence of intermediaries across the pharma supply chain translates into a lack of price transparency and issues with drug quality control. By one estimate, informal retail accounts for more than three-quarters of the value of the pharma market and parallel imports for up to half of drugs sold in pharmacies. Less than 5% of Nigerian households are actually able to cover the full price of ethical drugs through out-of-pocket spending or private health insurance. For the 95%, out-of-pocket healthcare spending accounts for 70% of total health expenditure.
These inefficiencies are by no means unique to Nigeria. Between 30 and 40% of all medication in Africa is either sub-standard or fake. The continent has some of the highest branded drug prices in the world, as well as some of the lowest average incomes per capita. The World Health Organization found that a basket of 50 medicines in essential therapy areas costs 30 times more than International Reference Prices (IRP) for original brands and twice the price of brands in other emerging markets.
We had been closely studying the pharmaceutical supply chain space in Nigeria for over a year before we met the founder of a company proactively addressing the entrenched challenges in the sector. In our first meeting, Sam walked in carrying a backpack containing nothing but his laptop and a few drug samples for his next client meeting - all the “tools” he needed for his trade. Meeting Sam was an epiphany moment for the team. In talking to him, it was clear that he had an itch. Then and there, we knew we had found the bridge between the problem and the solution.
For Sam and his co-founder Victor, the drivers are personal. They both come from families who own community pharmacies or Patent and Proprietary Medicine Vendor (PPMVs) inNigeria and have experienced inefficiency first hand whilst running their family businesses.
It is these experiences that make them the ideal duo to practically and holistically solve for both the online and offline in the pharma supply chain. When building technology in Africa, there is a non-negligible touch element that is only found in the best teams on the continent. The intersection and complementarity of the founders’ experiences has given them an in-depth understanding of the problem and empathy that has created a unique lens through which they iterate and drive tangible value for their customer base.
Remedial Health is a tech-enabled, pharmacy-centered healthcare network that creates cost reductions of more than 25% at the point of care. In a country where minimum wage is $72 a month, a 25% cost reduction on medication frees up enough cash for a day's worth of food.
After joining the Remedial Health network, pharmacy owners, like Godwin, are able to guarantee the accessibility, affordability and quality of essential drugs for their customers. Today, Godwin can order at any time using Remedial Health’s online ordering platform and receives stock less than 24 hours later. He saves an average of 10% on pricing and pays for the stock 7to 14 days later.
“Since I discovered Remedial [Health] in 2021, it has given me direct savings in time and money and helped me have more cash in hand to do other things; the benefits are far above the 10% saved on just price of the drug” - Godwin Amema
With 500,000 of these PPMVs with people like Godwin across Nigeria, driving over 80% of its multi-billion dollar market for annual pharmaceutical sales, we are confident there is larger room for growth and impact. The team at Remedial Health have shown a unique understanding and view on the problem, and we are excited to support Sam on his mission to provide access to quality and affordable healthcare in Africa.