E-commerce giant Amazon is involved in early-stage talks with Hyderabad-based MedPlus, India’s second largest retail pharmacy, looking to enter Indian pharma industry. Amazon had recently acquired, PillPack, an online pharmacy for $1 billion.
According to sources, there have been preliminary discussions between Amazon and MedPlus but it is too early to call it a deal. It is clear that Amazon is serious about entering the pharmacy industry in India.
MedPlus was founded by Dr. Madhukar Gangadi in 2006. Dr. Gangadi envisioned a reliable source of medicine for the Indian consumers after reading a WHO report that claimed that 30% of the fake medicines sold all over the world came from India.
Today MedPlus has over 1,400 pharmacies across the country, serving over 2,50,000 consumers daily, and employing more than 10,000 people. It later launched online pharmacy, medplusmart.com, in 2015, it is now the largest e-pharmacy in the country.
MedPlus operates other businesses in the healthcare industry, apart from its pharmacy store, these include MedPlusLabs, disease testing labs, MedPlusLens, an optical store and RiteCure, a hospital pharmacy management service.
The company claims to be profitable and has a turnover of ₹2,000 crores. As per the company filings, it recorded a revenue of ₹1,726 crores for the year 2015-2016 with a profit of ₹9 crores.
Earlier this year in January, MedPlus had raised around ₹700 crores ($117 million) in debt financing from Goldman Sachs to buy out existing private equity investors including US-based Mount Kellet Capital Management Lp, TVS Capital Funds Ltd, and Ajay Piramal’s India Venture Advisor’s Pvt. Ltd. Dr. Gangadi now holds a majority stake of 90% after the buy out.
Amazon is not the only e-commerce giant venturing into the Indian pharmaceutical industry. India’s leading e-commerce platform Flipkart has held talks with two online pharmacies, Gurugram-based 1mg, along with Mumbai-based PharmEasy. Flipkart is also looking to enter this space and could provide a competition to Amazon. Other big players in this space include Netmeds and Medlife.