Vanguard Pharmacy expands, part of a dynamic Nigerian pharmacy sector

Vanguard Pharmacy, a growing regional chain of retail pharmacies in Nigeria, has opened its fifth outlet. The new 750m² outlet is in Ibadan, the Oyo state capital. It soft launched in April 2020, during the lockdown for the COVID-19 pandemic. The chain is part of a highly dynamic pharmacy sector, which is seeing growing interest and investment.

Vanguard Pharmacy was founded in 2006 in Ibadan, but only opened its second outlet in 2015, also in Ibadan. It has since opened outlets in Abeokuta, Ogun state in 2016 and in Osogbo (95km northeast of Ibadan) in 2017.

The Nigerian retail pharmacy sector is large but highly fragmented, comprising mostly independent pharmacies. Much of the formal healthcare infrastructure is limited to major cities and most retail sales across the country are made through informal markets. Counterfeit pharmaceuticals can be found in over 40% of the market. The COVID-19 pandemic has highlighted both the importance of community pharmacies, and the poor level of mapping of these resources in Nigeria.

Leading chains in Nigeria include: Medplus, which has a major network in Lagos, as well as stores in Ibadan, Warri, Onitsha, Enugu, Umuahia and Port Harcourt; Alpha Pharmacy, which has branches in Abuja, Awka, Enugu, Lagos, Onitsha and Port Harcourt; Medmart, which has a chain of five stores in Lagos; HealthPlus, the largest chain took an $18m investment from Alta Semper Capital LLP in March 2018.  At the time, HealthPlus claimed to have 80 outlets across several states, although its store locator only lists 58 now. In September 2019, London-based TLG Capital, in partnership with Medical Credit Fund invested in small Lagos chain Express Pharmacy. By the end of 2020, Express Pharmacy aims to have a state-wide network of stores in Lagos.

Perhaps some of the largest change is in the wider supply chain. In February 2020, Lifestores Healthcare, a Lagos-based three-year old startup, raised $1m in funding. The company is hoping to improve efficiencies in the supply chain for thousands of local pharmacies and small-scale chemist shops in Nigeria by providing an online buying platform for drugs. It also owns two pharmacy stores in Lagos.

The biggest disruptor is Ghanaian startup mPharma, which provides a digital prescription drug inventory service for pharmacies and their suppliers. It raised $17m in its latest May 2020 funding round. In March 2019 it raised $12m in a Series B round and $6.6m in a Series A funding round in 2017. mPharma operates a Vendor Management Inventory (VMI) system and QualityRx platforms in Ghana, Kenya, Nigeria, Zambia, and Zimbabwe.