NEW DELHI -- Mumbai-based online pharmacy startup PharmEasy has raised $220 million in a fresh round of financing led by Singapore state investment firm Temasek Holdings.
The development was first reported by BloombergQuint, which cited unidentified sources. DealStreetAsia independently confirmed the funding with a source close to the development.
Canada's second-largest pension fund Caisse de dépôt et placement du Québec; LGT, the private banking and asset management group controlled by the Princely family of Liechtenstein; and South Korea's KB Financial Group also took part in the round.
Existing investors Bessemer Venture Partners, Orios Venture Partners, Eight Roads, Infosys co-founder Nandan Nilekani and Helion Ventures co-founder Sanjeev Aggarwal-backed Fundamentum, also joined in the fundraising.
Co-founded by Dhaval Shah and Dharmil Sheth in 2015, PharmEasy has reached a valuation of $700 million in the latest round.
Sheth declined to comment on the funding. On expansion plans, however, he said the company would focus on further improving the consumer experience, technology and processes to ensure timely delivery of all the medicines in the safest way possible.
"There's a lot of integration happening on the supply chain front," Sheth said. "We are connecting different stakeholders seamlessly. We are integrating the retailers, distributors and the pharma companies on our technology platform. This is one of the biggest levers that we now have. This technology is going to change the way healthcare works in India."
The financing comes almost a year after PharmEasy raised $50 million in a Series C funding round led by Eight Roads Ventures India, F-Prime Capital Fundamentum and San Francisco-based hedge fund Think Investments. BVP also participated in that round.
PharmEasy connects patients to local pharmacies and diagnostic centers through an integrated online platform, making healthcare accessible and affordable across India via quick doorstep deliveries and savings on their healthcare needs. It also provides services including home diagnostic tests, medicine dosage reminders and an automated medicine refill subscription.
"We deliver medicines to each and every pincode in the country, which comes to about 22,000 pincodes spanning Kashmir to Lakshadweep. We have more than 100,000 SKUs, which we deliver on a monthly basis," Sheth said, referring to stock keeping units that are used to track inventory.
PharmEasy has a workforce of over 2,000.
On consolidation and acquisition opportunities in the sector, Sheth said, "We are looking at synergistic areas be it medicine delivery, technology, or platforms that can be used by doctors and delivery boys. There are talks happening with multiple players."
E-pharmacy is at a nascent stage in India, but like other categories, has the potential to be a very large industry segment in the near future, said Frost & Sullivan in its report earlier this year. The advent of online pharmacy retailers in the Indian market will further increase the penetration of the organized pharmacy segment.
The report added that the e-pharmacy market in India is estimated to grow at a compound annual growth rate of 63% to reach $3.6 billion by 2022. It is expected that the e-pharmacy model could account for 15%-20% of total pharma sales in India over the next 10 years.
Other key players operating in the space include Medlife, Netmeds,1MG, Myra, CareOnGo and Pharmasafe.
According to a Mint report in July, Temasek is looking to deploy more capital in India even as it is slowing down on investments globally. The investment firm's India portfolio stood at $11 billion as at the end of March, compared with nearly $10 billion a year ago.
Last year in September, the Singapore firm announced it would pump $400 million into the National Investment and Infrastructure Fund that was set up by the Indian government to boost infrastructure financing in the country.
In June this year, Temasek said it would invest a total of 10 billion rupees ($140 million) in its portfolio company AU Small Finance Bank through new shares and warrants. It also owns stakes in Ascendas India Logistics Programme, Adani Ports and Special Economic Zones, and payments technology firm Pine Labs.
The firm is also reportedly in talks with Swedish alternative investment firm EQT Partners to launch a green energy platform in India with an initial combined equity commitment of $500 million. Temasek is also in a race to buy the gas pipeline assets of state-run Gail (India).
DealStreetAsia is a financial news site based in Singapore focused on corporate investment activity in Southeast Asia and India. Nikkei recently acquired a majority stake in the company.