Egyptian healthcare tech Yodawy raises $16M, backed by Delivery Hero Ventures • TechCrunch
Without appropriate government-led public health initiatives, health expenditures, including insurance and drugs, can strain individuals and households. In recent years, private institutions have played a major role in the considerable adoption of medical insurance and medicines, as well as in reducing the costs of transporting them across Egypt, the largest producer of pharmaceuticals in the world. the MENA region whose pharmaceutical market should reach 6 billion dollars. in value this year. Global Ventures-backed Yodawy is one such private player, and the pharmacy benefits manager raised a $16 million Series B round.
The UAE-based, MEA-focused venture capital firm co-led this round alongside Delivery Hero Ventures, the venture capital arm of global food delivery platform Delivery Hero, which has now completed his first check in Africa. The Singaporean company AAIC Investment and the Saudi Dallah Al-Baraka also participated in this round. Existing investors who participated in Digital Healthcare’s $7.5m Series A funding round in 2019 include Middle East Venture Partners (MEVP), C Ventures and P1 Ventures also doubled down.
Co-founder and CEO Karim Khashaba told TechCrunch that the health-tech startup plans to use the investment to expand into markets in the Middle East and Africa, where the pharmaceutical market represents a growth opportunity. $60 billion market. Yodawy’s journey to Egypt began in 2018 when Khashaba founded the company with COO Yasser AbdelGawad and CTO Sherief El-Feky. They have built an infrastructure that hosts the services of its partners – insurance companies, medical providers, pharmacies and pharmaceutical/FMCG companies – and connects them with corporate clients and individuals.
Here is an example that highlights the problem that every Yodawy stakeholder faces. Over 90% of insurance prescriptions and claims in Egypt are recorded on paper. As insignificant as it may seem, it affects everyone in this value chain, with issues ranging from prescription errors to long treatment times and queues at pharmacies and hospitals.
Yodawy’s platform enables insurance companies and hospitals to automate approvals, reduce costs and improve customer experience. Additionally, pharmacies gain an online presence and increase sales via Yodawy’s e-commerce offering, which patients (via employer-led medical plans) can benefit from when they receive their medications and medications delivered. at their doorstep. Pharmaceuticals, on the other hand, can tap into Yodawy’s pharmacy network to get products into the hands of consumers.
“We have built a strong network of insurance partners and employer-led medical plans. We pretty much manage the end-to-end prescription value chain, from how prescriptions are digitally generated on the physician side, to how payers process prescriptions, to some sort of fulfillment infrastructure which currently manages the delivery of nearly 200,000 prescriptions. monthly in 30 cities in Egypt,” the general manager said during the call.
He claims that Yodawy is currently the main partner for most companies in the Egyptian market, numbering around 300, and serving their patients (employees) in need of chronic medication. The Giza-based health tech startup, which uses a B2B2C model, has partnered with 20 health insurance companies and 500 doctors, and 3,000 pharmacies have processed more than 4 million prescriptions through individuals from these companies. Meanwhile, Yodawy recently launched a flagship electronic prescription gateway that allows physicians to go paperless, with seven insurance companies and health management organizations participating in the program, generating more than 2,000 prescriptions. electronics generated daily. The company’s turnover has increased by 400% since its last valuation 18 months ago.
“The drug value chain is quite complex, and being able to streamline the process required us to build it [and] complementary products for insurance companies and doctors. So we serve physicians through our e-Prescription Gateway and have created significant traction in converting handwritten prescriptions to e-prescriptions,” the CEO said.
“This brings us to the second product, which is our approval engine which is currently used by almost 10 insurance companies in the market, which replaces the old manual approval processes that create a lot of friction with an approval engine. real-time approval that can automate 80% of insurance back office decisions.
A handful of online pharmacy providers in Egypt serve different types of businesses and individual customers, such as PharmacyMarts, Chefaa, and Vezeeta (one of its offerings); across sub-Saharan Africa, the likes of mPharma, Lifestores and Drugstoc come into conversation. But Khashaba argues that Yodawy is the only fully-fledged, technology-powered pharmacy benefit manager that manages the end-to-end prescribing cycle — whether it’s creating an e-prescribing gateway for hospitals and doctors or an approvals automation engine for insurance companies – and manages fulfillment.
What Yodawy lacks, however, are last mile capabilities. Its investment from Delivery Hero Ventures is strategic as the digital health startup could explore some form of partnership with Delivery Hero to manage this integral part of its business.
In addition to its expansion in the Middle East and Africa, proceeds from the investment, according to Yodawy’s statement, will fuel the growth of its chronic care program, which offers monthly medication refills to enrolled patients and handles daily deliveries to 38 cities in Egypt. . The company also intends to continue to automate its operations, enable larger-scale prescription processing, and enhance existing technology fulfillment capabilities to serve a rapidly growing patient base.
“We continue to be fascinated by the way they have [Yodawy] used technology to improve the healthcare experience for both insured and uninsured patients,” said Noor Sweid, managing partner of Global Ventures, explaining why his firm co-led the startup round after doing so. in its Series A. “This is reflected in their ability to serve over 50,000 chronic recurrent patients each month and saving them over 100,000 hours per month of queuing to receive essential drugs.”
Brendon Blacker, the managing partner of Delivery Hero Ventures who joins Yodawy’s board, adds that his company was attracted by the “clear vision of Egyptian health technology to revolutionize the pharmaceutical industry in the MENA region. “. This latest financing brings the total capital of the four-year-old company to $24.5 million.