PharmEasy Investor Marks Down Its Valuation To $456 Mn

The valuation of online pharmacy PharmEasy has plummeted to around $456 Mn, a drastic decline of 92% from its previous peak valuation of $5.6 Bn. This also marks another 18.57% valuation cut from the last fundraising in April, which valued the company at around $560 Mn . 

This significant drop was reported by TechCrunch first, citing PharmEasy’s investor Janus Henderson, who noted that his stake of 12.9 Mn shares is now valued at just over $0.76 Mn down from an initial investment of $9.4 Mn.

Inc42 has reached out to PharmEasy for comments on the development. The story will be updated based on the response. 

The development comes after the company secured over $216 Mn in fresh capital earlier this year. That fundraising round itself was conducted at a 90% valuation cut from the company’s peak, valuing it at around $560 Mn.  

Not to mention, PharmEasy’s current valuation seems even less than the $600 Mn at which it acquired diagnostic lab chain Thyrocare in 2021. 

PharmEasy’s financial troubles began to surface after it postponed an $843 Mn IPO scheduled for 2021. 

Following that, the company faced increasing pressure to manage its debts, including a substantial loan of $300 Mn from Goldman Sachs, which became difficult to repay amid a tightening market environment. 

In response to these challenges, PharmEasy launched a rights issue, raising $417 Mn to alleviate its funding crunch and address its debt obligations. 

Notably, this rights issue allowed existing shareholders to purchase shares at a discounted rate, which can lead to dilution of ownership for those who do not participate.

Another investor to mark down the value of their holdings in PharmEasy was Neuberger Berman in 2023 who reduced PharmEasy’s valuation by 21% to $4.4 Bn. 

Founded in 2015 by Dharmil Sheth, Dhaval Shah, Harsh Parekh, Siddharth Shah, and Hardik Dedhia, PharmEasy sells medicines through its flagship online platform and offers diagnostic services through its subsidiaries. 

On the financial front, the epharma company saw its consolidated net loss halve to INR 2,531.1 Cr in the financial year 2023-24 (FY24) on the back of a decline in its expenses and exceptional items. The company’s net loss declined 51.35% from INR 5,202.5 Cr in FY23.

However, it also saw a decrease in its operating revenue. PharmEasy’s revenue from operations fell 14.75% to INR 5,664.2 Cr in FY24 from INR 6,643.9 Cr in FY23.

This comes at the heart of PharmEasy witnessing a series of developments lately. Recently, ArisInfra Solutions, backed by PharmEasy’s CEO, filed draft papers for an INR 600 Cr IPO on August 16, 2024, indicating ongoing efforts to raise capital in the healthcare sector. 

Additionally, PharmEasy-owned Thyrocare announced plans to acquire the pathology diagnostic business of Polo Labs, expanding its operational footprint in northern India.