Netmeds' journey to a sweet deal as Reliance picks up a majority stake

Promoted by Dadha Pharma, it is one of the earliest players in online pharmacy

When Pradeep Dadha first talked to Mukesh Ambani’s son, Akash, and daughter, Isha, over Microsoft Teams, one can only guess whether he expected the virtual meeting to be this fruitful. But what is certain is that Dadha’s early entry in the online pharmacy delivery space has worked well for him. Reliance Retail has picked up a majority stake for Rs 620 crore in his Chennai-based start-up.

Dadha’s Netmeds, a collective that includes Vitalic Health and its subsidiaries, was founded in 2015 and is one of the earliest players in the online pharmacy delivery segment. Dadha himself comes from a family that has been in the pharmaceutical business for over a century.

A passionate entrepreneur who wishes he had founded — or at least invested in — WhatsApp, he says, “I cannot think of what I’d be if not an entrepreneur.” His role models are Apple’s Steve Jobs and Amazon’s Jeff Bezos, interestingly the very tycoon Mukesh Ambani is against in a heated race for supremacy.

Forty-year-old Dadha’s family ventured into the pharmaceutical business in 1914 and into drug manufacturing in 1972. The manufacturing unit, Tamilnadu Dadha Pharmaceuticals, merged with Sun Pharma in 1996. Today, the Group is a wholesale drugs supplier in Kerala and retails in Tamil Nadu.

 

 

Dadha leads the Pradeep Dadha group of companies and is the chairman of Notch Media, a media and entertainment business.

After graduating from Loyola College, Chennai, he joined his family business, Dadha Pharma, as a sales representative, moving later to the fulfilment and human resources departments. He eventually created a retail distribution chain of more than 1,500 outlets.

For some time, however, he moved away from the family occupation and joined Reliance Infocomm and Sun Communique in their contact centre divisions. Here, as part of the core management teams, he was involved with budget preparations, cost and return on investment analysis, client contract negotiations and human resources allocation, becoming competent at contact centre and BPO centre management. The experience prepared him well for his ensuing role as an early adopter of the global BPO trend.

He returned to the family business at a time when India was seeing an exponential growth in internet penetration. The environment for e-commerce and e-pharma was favourable. He grabbed the opportunity and launched Netmeds — an online medical store. That his family’s pharma company was among the most trusted in South India made it a less formidable challenge. But there was a concern: Would consumers feel confident buying medicines online? Would they wonder about their safety?

Netmeds had to build transparency and trust in its operations and processes. So, it got pharmacists to do the due diligence as in a brick-and-mortar pharmacy. Dealing with large stock units and ensuring their availability across India was also a challenge.

In the five years since its launch, Netmeds has managed to scale the length and breadth of the country, providing quality and affordable medicines in even the most outlying areas — delivering prescription medications to over 20,000 pin codes, and servicing over 5.7 million customers in over 670 cities and towns. And that, says Dadha, has been its advantage over its competitors.

Value-added services — automated refill reminders, cost-effective generic substitution advice, expense analytics and access to doctors’ consultations — have enhanced business.

Dadha knows how to keep pace with time. His firm is also employing artificial intelligence and machine learning to understand customers and predict health trends. He is determined to leverage technology as Netmeds diversifies into telemedicine, online doctor consultation, diagnostics and generic drugs.
 

Last year, Netmeds roped in as its brand ambassador a celebrity who would fit the image of reliability that it has consistently tried to present: Mahendra Singh Dhoni.

One of Dadha’s dreams is to buy a vacation home in Italy. The pandemic has put that dream on the backburner for now. But Dadha, pleased as he is with the profitable handshake with Reliance, isn’t complaining.