PharmEasy Raises $350 Mn In Pre-IPO Round At $5.6 Bn Valuation

SUMMARY

After the primary round worth $204 Mn and secondary sale of shares worth $150 Mn, the startup is eyeing an IPO by March 2022

New investors reportedly include Amansa Capital, ApaH Capital, Janus Henderson, OrbiMed, Steadview Capital, ADQ, Neuberger Berman and Sanne Group

PharmEasy founders Siddharth Shah, Dhaval Shah, Dhramil Sheth, Harsh Parekh and Hardik Dedhia have received new stock options post picking up secondary stakes worth $40 Mn

IPO-bound PharmEasy which is set to file its draft red herring prospectus (DRHP) this month has scooped up $350 Mn in a primary as well as secondary round.

The epharmacy startup has raised around $204 Mn in primary funding from Amansa Capital, Blackstone-backed hedge fund ApaH Capital, US hedge fund Janus Henderson, OrbiMed, Steadview Capital, Abu Dhabi’s sovereign wealth fund ADQ, hedge fund Neuberger Berman and London’s Sanne Group, ET reported.

Further, it has closed a secondary round of approx $150 Mn where existing angel and early investors such as Fundamentum, Eight Road Ventures and Bessemer Venture Partners have made partial exits, as suggested earlier this month.

Over 20 senior employees, five founders and the new investors have picked secondary shares at $5.6 Bn valuation.

Founded in 2015 by Dharmil Sheth and Dr Dhaval Shah PharmEasy merged with its investor entity, Ascent Health, to form API Holdings in 2019. This brought in three new cofounders – Siddharth Shah, Hardik Dedhia, and Harsh Parekh.

PharmEasy claims to connect 60K+ brick-and-mortar pharmacies and 4K+ doctors in 16K+ pin codes across India. It also provides SaaS procurement solutions, delivery and logistics support, and credit solutions to pharmacies.

The startup claims to have served over 20 Mn patients since inception.

PharmEasy founders — Siddharth Shah, Dhaval Shah, Dhramil Sheth, Harsh Parekh and Hardik Dedhia, who picked a total of $40 Mn secondary shares in the current round, have also received new stock options ahead of the IPO.

Each founder has been given a little under 10K stock options under its employee stock ownership plan (ESOP).

The Road To IPO For PharmEasy

PharmEasy was India’s first epharmacy startup to have entered the unicorn club. The startup joined the coveted club in the second week of April 2021 after it raised $323 Mn in a Series E funding round from Prosus Ventures, TPG Growth and existing investors.

This year, PharmEasy also acquired majority stakes in three prominent healthcare startups:

In May, it acquired its rival Medlife, an online pharmacy startup to strengthen its position in the epharmacy space
In June, the e-pharmacy unicorn acquired a 66% stake in listed diagnostic chain Thyrocare for INR 4,546 Cr.
In September, Inc42 exclusively reported that API Holdings, the parent company of PharmEasy, has acquired a majority stake in a healthcare supply chain startup Aknamed for INR 307 Cr.

According to reports, API Holdings is expected to file its DRHP with the market regulator SEBI by the end of this month. It is likely to go public by March 2022.

The appointment of independent directors is also a standard procedure for a startup before it files its DRHP. In September 2021, PharmEasy has appointed five independent directors to its board, indicating its proximity to the $1 Bn IPO.

With PharmEasy going for IPO next year, it will join lists of Indian tech startups such as OLA, food delivery platform Swiggy, digital payments startup Paymate, and edtech startup BYJU’s among others set to make their public stock exchange debut.