What is Saveo Healthtech about?
Saveo is a B2B marketplace that is streamlining the pharma ecosystem of India. It is on a mission to empower traditional pharmacies and build a reliable, scalable and efficient healthcare supply chain. The company is also working towards converting quality suppliers into dark stores and running a vertically integrated full-stack managed marketplace model to provide better, faster & cheaper procurement to pharmacies across India. It has over 100000 active outlets and is on the path to become the largest player in the category by December 2022.
How do you think the Indian pharma industry is fragmented? Why is that problematic?
In the current healthcare industry, at every stage, a wide range of stakeholders are involved, and the procurement and distribution of products and services to reach end-users are filled with several hoops to jump through. This interface with multiple stakeholders presents several risks and challenges, such as lack of transparency, cyber threats, and data security issues – all of which limit companies’ capabilities to provide the best care.
In addition, pharmacies have continued to be the first line of response to healthcare in India. However, historically, 83 per cent of them are without a degree, and 85 per cent are without Enterprise Resources Planning (ERP), which leads to patients receiving only an average of 6/10 medicines on pharmacies. It is important to note that the pharma supply chain is unlike FMCG – distributors in the sector who work independently can hold as many companies as they want, focus on Stock Keeping units (SKUs) they want to sell, and supply to any location in India. This system leads to limited suppliers with good SKU coverage and multiple hoarding in the layer. The more we move away from the city, the more serious the problem becomes.
Saveo is working to bring all the SKUs sold in a state on a single platform. Currently, we have 40,000+ SKUs across all pharma categories (branded generics, trade generics, surgical, Ayurveda, homoeopathy, speciality, OTC, veterinary, etc.), twice the largest distributors in India. With this, we provide an 80 per cent more fill rate to pharmacies solving their procurement problem. Our analytics platform predicts upcoming prescriptions and helps pharmacies stock the correct inventories.
What are the issues that need to be addressed in the current supply chain?
India is often referred to as the ‘Pharmacy of the world’, with a local chemist store available within a two-kilometres radius; however, the sector comes with its own set of challenges. The COVID-19 pandemic exposed the highly fragmented nature of the sector through several reports of delaying routine treatments, straining healthcare budgets, derailing drug development for non-COVID-related diseases, and causing supply chain disruptions. In addition, the availability of medicines is another issue, with pharmacies scrabbling across important medicines amid the crisis. The story is grimmer in the rural areas where people also receive fake medicines and are often wrongly diagnosed, considering that pharmacists are not equipped with adequate knowledge.
How is Saveo Healthtech streamlining the pharma industry?
Medicine availability has been a challenge India is facing even as we move into Industry 4.0. While other sectors flourished technologically, the pharma industry was lagging owing to its highly fragmented nature. Saveo for searched for the problems at the grassroots experienced by the last-mile pharmacies and created a platform with a promise that India would see no prescription bounce.
To achieve this feat, the company has converted quality suppliers into dark stores and run a vertically integrated full-stack managed marketplace model to provide better, faster and cheaper procurement to pharmacies. All medicines, from allopathy to Ayurveda, were made available on one platform for the first time in India. It became the go-to marketplace wherein distributors/wholesalers/manufacturers sit on the supply end – pharmacies sit on the buyer end and serve as the bridge that connects the commerce. The company has also built electronic registries for medicines in India and is currently building efficient AI recommendation systems for easy search of medication and to capture volatility in demand. Through the extensive network, our company ensures the timely delivery of medicines. The company’s delivery methods are also empowered with route optimisation algorithms that reduce the time taken for match-making.
Which cities are you active in at the moment? What are your further expansion plans?
We have built a reach across 70 per cent of Karnataka, 35 per cent of Telangana & 20 per cent of Tamil Nadu. Saveo delivers in the cites and tier II to tier V areas with a network of 7500 transacting pharmacies.
Currently, the strategy is to go deeper into the existing states and open new hubs in the nearby states. By March 2023, we plan to have over 12 hubs in India, covering 500+ cities/towns and delivering to 50000+ pharmacies. We plan on serving new areas from a nearby existing hub so that the pharmacies start experiencing the power of procurement.
Are you in touch with any state government or the Central government for any projects? Kindly share details about the same.
At present, we are not in association with the Central government for any projects. However, during the pandemic, we supplied medicines to Bihar, Gorakhpur, Rajasthan, Tripura, Andaman and Nicobar, Orissa, Jharkhand and Pune with the aim of tackling medicines shortages and stock-outs.
Are you looking for any funding to reduce the fragmentation in the Indian pharma industry?
At the moment, we have a runway for 24 months and are on target to become a profitable company by July 2023.
Cherish Mundhra is an intern with Express Pharma