Ibnsina Pharma, Egypt’s second largest pharmaceutical distributor, is acquiring a 75% stake in the national 3elagi online pharmacy marketplace, it declared today in a statement.
3elagi helps customers from nearby pharmacies to browse, compare, and order medicines and beauty products. After its launch in 2018, it claims to have supported over 600,000 users.
The exact terms of the agreement were not revealed, but the company said the contract includes EGP 25 million (USD 1.6 million), much of which will be used for 3elagi’s expansion. For founders and investors, it often involves a cash out portion (the money they will earn as part of the deal). For $1.6 million, a 75 percent stake gives 3elagi a $2.1 million worth value, which could be considered a fast win for the founders.
3elagi was part of the first batch of local accelerator, Falak Startups. Apparently, Falak was the only investor in this start-up. The founders will continue to hold a 25 percent interest in the start-up (a small portion of which will remain with Falak).
“The founders will remain on board with the current management team to further develop the company and improve the digital presence of Ibnsina Pharma,” the statement said.
$1.4 million was also invested in internal digital projects by Ibnsina Pharma, including an order for a mobile pharmacy app that was introduced earlier this year. The app allows pharmacies to shop and order various medicines and other Ibnsina products. The firm says it now has over 4,000 pharmacies using the service. By investing another $1 million in it next year, it aims to turn it into a ‘fully-fledged site’ for pharmacies.
In a statement Mostafa Hamouda, 3elagi’s co-founder and Managing Director expressed, “We are pleased to partner with Ibnsina Pharma, Egypt’s fastest growing pharma distributor with its high quality and solid distribution capabilities. We are optimistic that finding the right partner that is aligned with our own principles and strategic vision, would turn the application into a full-fledged healthcare network.”
He also said the move supports the country’s efforts to introduce a track and trace system to prevent counterfeit and unlawful drugs from entering the market.
Co-CEO Omar Abdel Gawad of Ibnsina Pharma said the company will continue to search for more start-ups to potentially acquire them to boost Ibnsina Pharma’s offerings.
The deal marks Falak Startups’s first partial exit. In a statement, its Managing Director Youssef ElSammaa said, “We are pleased to have been part of 3elagi’s mission from ideation to its progress. The aim of Falak is to empower Egypt’s youth and technology and serve as a catalyst for the fast growth of these start-ups in order to encourage the private sector to invest in these companies and take them further. We think this is just the beginning of several more collaborations and future achievements.”
There are several other startups working in Egypt’s online pharmacy market, with the two most important players being Chefaa and Yodway.
