Pharmeasy acquires Medlife, becomes India’s largest online pharmacy

pharmeasy acquisition

Pharmeasy announced on Tuesday that it has acquired its smaller competitor Medlife. This is the largest consolidation deal in India’s fast-growing online pharmacy sector and comes as Reliance, Tata, and Amazon are all competing for a share of the market.

Dhaval Shah, co-founder of Pharmeasy, wrote on Linkedin, “This will make us the largest healthcare delivery platform across the country by a distance — serving more than two million families every single month.”

“While we love the Medlife brand, we believe that a singular focus on our consumer needs through a single platform ‘Pharmeasy’ will help us solve for consumer needs much better,” he added.

In a blog post, Pharmeasy said that Medlife would suspend its operations and would be consolidated with its own platform from May 25. Customers and retail partners of Medlife would be brought onto the Pharmeasy platform, the company added.

The deal, which was settled some time ago, saw Medlife’s shareholders get a 19.59% stake in Pharmeasy’s parent entity API Holdings, valued at $240 million.

The family office of Prabhat Narain Singh, one of the founders of drugmaker Alkem Laboratories Ltd, which was the largest shareholder in Medlife, also has a seat on the board of API Holdings.

The news of the acquisition comes after a $350-million investment led by Prosus Ventures and US-based private equity firm TPG Growth in API Holdings, which was announced last month. The deal valued API holdings at $1.5 billion, making it India’s first online pharmacy to become a unicorn.

Online pharmacies are among a few verticals in the country’s e-commerce sector to have grown during the second wave of the pandemic. According to data from e-commerce services platform Unicommerce, shipment volumes of pharmaceuticals grew by 18% in April compared to the previous month. Overall e-commerce shipments fell by 11% over the same period.

This is after order volumes more than doubled over the course of 2020, according to insiders, while the number of people who used online pharmacies tripled. Market tracker RedSeer Consulting said nine million families used online pharmacies last year.

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