Betting big on generic medicines
Generic medicines are cheaper than branded drugs but have the same effects and composition. Still, the consumer isn’t getting the benefits despite the government announcing steps to popularise them. In a bid to ensure that generic drugs reach those in need, two IIT alumni — Girish Agrawal and Siddharth Gadia — launched Generico in May 2017.
Last week, Generico, which runs a network of pharmacies selling generic drugs, raised $14 million in a Series
A funding round, led by venture capital firm Lightbox. Its existing investor Whiteboard Capital also participated in the round. This was the third funding raised by the company. In 2016, Whiteboard Capital, Kunal Shah, and other angel investors infused ~1 crore into the start-up, which in 2018 received $1.5 million in a Pre-series A round by Tomorrow Capital and Whiteboard Capital.
Agrawal and Gadia had launched their own start-ups before coming together to start Workcell Solutions in 2015, a B2B pharma platform, to solve the retail issues of chemists. Deeper into the business, they found branded medicines rake up huge margins, and decided to make a foray into B2C to pass on the benefits of cheaper generic drugs to the consumer.
Generico, which has 400 employees and 41 stores across Mumbai, plans to use the recent funding to expand to 150 outlets and invest in building a supply chain and data, and bet on technology. It didn’t divulge its revenue, but claims to have 350,000 customers. Reports say it has made gross sales of over ~100 crore so far.
“We have a master franchisee, which owns and operates our stores. We have a supplier that provides all the goods to the franchise, as well as technology,” said Gadia.
Apart from selling generic medicines, Generico provides health care education and organise awareness camps on chronic diseases.
“We are devising technology-enabled solutions for diseases, such as diabetes, hypertension, and thyroid, which will empower the patients to manage their life better,” said Agrawal.
Sandeep Murthy, partner at Lightbox, which has closed its third fund at $209 million, said: “Chronic patients have no source of reliable information or network to rely on to help them manage their diseases. Generico’s pharmacies not only sell pills but also provide a suite of preventive health care solutions.”
The Centre’s Pradhan Mantri JanAushadhi scheme provides generic drugs at a 50-90 per cent discount on their branded counterparts. According to reports, the government plans to amend the Drugs and Cosmetics Rules to specify separate colour code for generic medicines from branded medicines.
Generico has a few competitors, too. Pharmacy chains Stayhappi Pharmacy in 2018 j oined hands with Thulasi Pharmacy to expand generic drugs stores in South India.
Generico, which has 400 employees and 41 stores across Mumbai, plans to use the recent funding to expand to 150 outlets and invest in building a supply chain and data, and bet on technology