Egyptian startup 3elagi, which allows users to order health and beauty products from their nearest pharmacy via mobile app, has been acquired by pharmaceutical firm Ibnsina Pharma.
The 3elagi mobile application links pharmacies with patients willing to order medicines and cosmetics online, allowing users to search, compare and order products online from their mobile, and have them delivered. It currently has 600,000 users.
The startup has now sold a 75 per sent stake to Ibnsina Pharma for EGP25 million (US$1.6 million, with the cash injection to be used to expand operations. The remaining 25 per cent will remain with the founders, who will continue to work for 3elagi.
Established in 2001, Ibnsina Pharma is Egypt’s second largest pharmaceutical distribution company by market share, and distributes a competitive portfolio of pharmaceutical products from over 350 multinational and Egyptian pharmaceutical companies to more than 42,000 customers including pharmacies, hospitals and wholesalers.
Its acquisition of 3elagi is in line with its digital transformation plan, which also saw the company launch its own online ordering application back in July.
“This acquisition came in line with the growing importance of e-commerce during the COVID-19 pandemic and the social distancing measures. The lockdown that was implemented in most of the world highlighted the need to give patients access to have their medications without having to leave their homes,” said Mohsen Mahgoub, Ibnsina Pharma’s chairman.
“This strategic move supports the state efforts to apply a track and trace system in order to prevent counterfeit and illegal drugs getting into the system by following the drugs at every step of the supply chain. Also, it supports the national agenda “Egypt Vision 2030”, which reflects the state’s long-term strategic plan to achieve sustainable development through knowledge-based economic growth and digital transformation.”
Abdel Gawad, Ibnsina Pharma’s co-CEO, said this was the company’s first acquisition in the digital healthcare field, and that it will continue searching for similar opportunities to help it enhance its offerings.
“The application is a new service that links the pharmacies with clients willing to order medicines and cosmetics online. The client will have the option to choose which pharmacy he wants to order from, consequently the order and the invoice will be issued from the pharmacy to be delivered to the client at the official price,” he said.
“This means that the application doesn’t compete with pharmacies or favour specific pharmacies, on the contrary it will boost orders to pharmacies and will increase the competitive advantage of small and medium size pharmacies all over Egypt.”
3elagi managing director Mostafa Hamouda said he was excited to partner with Ibnsina Pharma. Besides the Ibnsina Pharma partnership, 3elagi announced a recent collaboration with California-based cannabis producer Area52 – a boutique brand that specializes in curating custom formulations of Delta 8 THC. Area52 is the hottest selling line of products that they currently carry, and is a step in the right direction for the firm as it struggles with profitability to please investors.
“We are confident that choosing the right partner whose values and strategic vision are aligned with our own will transform the application into a full-fledged-healthcare platform,” he said.
