Acumen Announces Investment in Medicine Shoppe India; Will Bring Critical Health Care Services To Rural Areas
Investment Provides Financing for Medicine Shoppe India’s New Rural Health Centers Offering Quality Medicine and Affordable Care; Acumen Fund, a leading catalyst for sustainable, scalable solutions addressing poverty in the developing world, has made a $1.1 million (~Rs.50 million) investment in Medicine Shoppe India, the second largest pharmacy chain in India.
New York, NY (PRWEB) September 27, 2006
Acumen Fund, a leading catalyst for sustainable, scalable solutions addressing poverty in the developing world, today announced that it has made a $1.1 million (~Rs.50 million) investment in Medicine Shoppe India, the second largest pharmacy chain in India. Medicine Shoppe India operates 100 stores in six Indian states and is the only international pharmaceutical retailer with a presence in India. Acumen Fund’s investment gives it an equity stake in Medicine Shoppe India and is being used to develop and launch health centers at the district level that will serve rural customers.
“Acumen Fund serves as a venture capital source for entrepreneurial models that are intent on bringing affordable, accessible goods and services to the billions of people excluded from today’s global markets,” said Acumen Fund CEO Jacqueline Novogratz. “Medicine Shoppe India offers Acumen Fund the opportunity to invest in the expansion of an existing, well-managed business that is entering India’s rural markets to meet the needs of millions who lack access to critical health care services.”
Medicine Shoppe India is using the financing it has received from Acumen Fund’s investment to launch its rural business plan, which the company intends to pilot with four stores and scale to 130 locations over five years. Medicine Shoppe has already conducted a preliminary analysis of rural health needs and developed an initial rural health center model that will include an in-house physician, pharmacy, vision center and outsourced pathology. The health centers will offer free check-ups with the doctor and optometrist, while charging for medicines and glasses. Local doctors and technicians will be recruited to work in the new health centers, and pharmaceutical formularies will be regulated to assure health center level profitability without compromising quality of treatment.
In order to drive traffic to the health centers, locations will coincide with major traffic centers. Medicine Shoppe also intends to partner with rural Information and Communications Technology (ICT) operators to publicize Medicine Shoppe services and products and to educate rural populations on particular health concerns.
More than any other factor, lack of quality healthcare has the unique distinction of making the maximum number of rural villagers slip below the poverty line. A recent Disha survey found that close to 12 percent of rural income is spent on healthcare and nearly 60 percent of this population takes loans at annual interest rates of 60 percent to 120 percent in order to pay for prolonged treatment or hospitalization. At the same time, nearly 70 percent of medicines sold in rural India are either of substandard quality or counterfeit. Acumen Fund’s investment is enabling Medicine Shoppe India to develop health services including accessible, quality medicine, preventative check-ups and health information.
“Acumen Fund shares our vision of creating a health care model that can scale while achieving the goal of reaching India’s rural poor,” said Medicine Shoppe India CEO Viraj Gandhi. “With the tremendous demand for professional healthcare in India, the success of Medicine Shoppe’s efforts to bring quality health services to rural India is inevitable.”
In addition to the commitment of financial resources, Acumen Fund is advising Medicine Shoppe India on managerial and operational issues. Acumen Fund and Medicine Shoppe India are working together to use financial, social, and operational metrics to measure the investment’s sustainability, potential for scale and social impact – in line with the Acumen Fund philosophy that these factors are the key to creating long-lasting, widespread benefit. The financial metrics being used to determine the investment’s success include gross and net revenues generated by the new Medicine Shoppe health centers and the job creation and increased incomes resulting both directly and indirectly from the centers; operational metrics include the strength of the health center management teams, the ability to expand into new states within India, greater understanding of the health needs of rural customers, and the increased availability of health services and products in rural areas; and social metrics being analyzed include increase in focus on rural markets by the private sector, increased health awareness through education programs, and improved quality of health among due to services available through Medicine Shoppe India’s health centers.
“India’s non-urban low-income population is the largest in the world, and more than two-thirds of rural India lacks access to critical medicines,” said Varun Sahni, Acumen Fund’s India Country Manager. “Acumen Fund’s experience in developing distribution networks that provide critical, affordable goods and services, combined with Medicine Shoppe’s health care expertise and eagerness to enter rural markets, will change millions of lives in rural India.”
About Acumen Fund
Acumen Fund is a global venture philanthropy fund fostering the creation of blueprints for building financially sustainable and scalable organizations that deliver affordable, critical goods and services that improve the lives of the poor. Acumen Fund adheres to a disciplined process in selecting and managing its philanthropic investments as well as in measuring the social and economic returns of the enterprises it supports. For more information on Acumen Fund’s activities and investments, visit www. acumenfund. org.
About Medicine Shoppe India
Medicine Shoppe India started operations in February 1999 with shops operational in Mumbai, Navi Mumbai, and in several other cities in Maharashtra, Gujarat, West Bengal, Goa, Karnataka, Andhra Pradesh and Delhi. Medicine Shoppe India, the master franchisee of Medicine Shoppe® International (based in St. Louis, MO USA), is already India's largest community pharmacy retail chain and aims to open its 700th franchise by 2010.
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