MyDawa: How an investor helped us disrupt Kenya’s drugs market

The app is a different way of getting affordable, quality and safe medication

NAIROBI, KENYA: Neal O’Leary’s accomplishments could easily fill several pages. He started out as a solicitor in one of Ireland’s premier law firms, went on to become a senior executive at the London Stock Exchange and then an investment banker at UBS, where he was responsible for executing several large deals.

Neal chairs and controls interests in several companies, including Geneva Holdings, Topaz, Arc Connected Health, Sammon Contracting, Sportdec and Noster, with property and mining interests around the world.

One of his latest ventures as CEO of ION Equity, a corporate finance firm and private equity investor, brought him to Kenya to set up MyDawa.

The concept was conceived to streamline the process of drug delivery to consumers. Hustle spoke to MyDawa Managing Director Tony Wood to get an overview of what MyDawa is about and what it’s hoping to accomplish.

What, exactly, is the MyDawa app?

The app is the public end of a huge amount of work.

It’s a different way of getting affordable, quality and safe medication – the app gives you a level of convenience to access that. It’s an e-Commerce solution where you can go in, browse our products, select them and check out. You also have the option of uploading your prescription.

Our pharmacist will then transcribe that and place it in your cart and after that, you can go on the platform and follow the checkout process.

The additional step we have at checkout is that you can choose a pharmacy that’s convenient to pick the medication up from. You pay by M-Pesa and are notified by SMS that your product has been dispatched for collection. We do all this within a four-hour window.

What gap is your company seeking to fill?

We are a technology solutions that fixes a global problem. The technology allows us to have the transparency to gain efficiency in the supply chain and to make it convenient and affordable for customers to procure medicine.

Neal O’Leary, the CEO and chairman of ION Equity, which is our principal investor, had the idea to set this up two years ago. He identified a problem with the supply chain in the pharmaceutical industry, which was leading to increased costs to the patient, as well as an increased risk in terms of the quality of medication provided.

The bit that the consumer doesn’t see is that the supply chain for pharmaceutical products is quite long and quite fragmented. At each stage, the product changes hands, costs are introduced, sometimes for little value, and risk is also introduced. Supply chain efficiency is something every business is looking to streamline.

All we are doing is simplifying the supply chain. For our own products, we manufacture them, import them, distribute them and hand them over in a secure package to the patient. This allows us to gain some level of efficiency and we can pass those efficiencies on to the customer in terms of price reductions.

Are you manufacturing your products in Kenya?

No, manufacturing is primarily being done in India. We are using WHO (World Health Organisation) and GMP- (good manufacturing practices) approved plants. They are all very good quality manufacturers. India is the main manufacturer of good quality pharmaceuticals, and an awful lot of brand manufacturers get their products manufactured in India. We are using some of the same plants that they are.

What category of drugs do you provide?

There was a lot of consumer research done at the beginning to figure out what products were most required. What we are initially offering are the normally prescribed drugs, like antibiotics and painkillers – those things that would be included in a general prescription. We also focus on non-communicable diseases, like hypertension, diabetes and things like that.

We are also working with other manufacturers in Europe and the Middle East to supply us with other ranges of products, like multi-vitamins especially for kids, food supplements and skincare products like the Dead Sea mineral products, which are supposed to be quite good.

Why don’t you deliver medication to directly to the consumers placing the order?

For two reasons: there is still a general feeling that for prescription products, it’s good to have that last consultation with the pharmacist even though the labels are all there; the second reason is that it is illegal in Kenya. There has got to be a one-on-one physical relationship between the patient and the pharmacy.

How much did it cost to launch MyDawa?

A lot! We have a commitment for $5 million (Sh516 million), which we are currently drawing down on. A big chunk of that was used in the development of the IT solution and in the registration and purchase of our products.

We have been very fortunate as a start-up. We aren’t a start-up that has had an idea and had to go out and look for an investor. We are a start-up with an investor who had a great idea, so he was able to invest with his private equity company to make this idea a sustainable business.

Why did you choose to launch this product in Kenya?

Inefficiency in the supply chain and quality concerns are all global issues. This is, therefore, something that we could have started elsewhere, but Kenya was chosen primarily because the adoption of technology is well known.

Internet coverage is also an awful lot better than it is in other regional countries, as is the prevalence of mobile payment services. The overall environment in Kenya was, therefore, conducive for us to launch this service. Plus regulation of the pharmaceutical industry is quite good here.

What sets MyDawa apart?

We have got a very, very unique authentication solution. We have secured all our packs at the production line with tamper-proof seals. That seal contains an authentication code that you can scratch off to reveal. You can SMS this to a short code and get a response. It not only lets you know that it is a genuine product, but that it’s exactly what you ordered.

We believe that to be a global first.