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1mg raises Rs 100 cr from Maverick Capital Ventures, Sequoia

The firm plans to use capital infusion to grow its reach from 13 to 30 cities

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1mg,maverick Capital Ventures, Sequoia

Patanjali Pahwa  |  Mumbai 

Pharma

1mg, a health tech start-up, announced that it had raised Rs 100 crore from Maverick Capital Ventures, Sequoia India and the Omidiyar Network. The company uses an offline network of pharmacies to sell prescription, over-the-counter drugs and e-diagnostics, which lend clarity to test results.

The firm plans to use capital infusion to grow its reach from 13 to 30 cities. 1mg, which was primarily a metro-centric company, will see its network grow to tier-2 cities such as Surat, Kanpur and Lucknow, among others.

"This money will be invested, among other things, in verticals, such as homecare and paediatrics, lend harmony to our current offerings," said Gaurav Agarwal, chief technology officer and co-founder, 1mg. The company claims it has around five million app downloads and one million unique consumers who use its services every month.

Online pharmacies have been coming under flak and their legitimacy has been questioned, especially due to the sale of prescription drugs.

"We have a stringent verification system. The prescription has to be uploaded on the platform, the script will be digitised and then verified by the pharmacy fulfilling the prescription," said Agarwal. An algorithm designed by the company then analyses the legitimacy of the script. "If you try to fudge a prescription, our algo will catch it and the order will not be fulfilled," he added.

He added the company does not sell "habit forming drugs", which have very stringent verification processes. He explained that the prescription should be stamped and kept on record for a period of time. But, several non-habit forming drugs, too, need physical verification.

"We typically use the pharmacy's logistics network to deliver some of our medicines and that is when some of the checks happen as well," said Agarwal.

The company also ruled out that it would come under pressure from pharmacies that have been calling for a ban of websites such as 1mg.

"We are on the right side of the pharmacies. We are not taking away their business but adding to it," Agarwal added.

1mg also said that while it increases the business of pharmacies, it helps customers reduce their bills.

"Our app allows customers to access knowledge about substitutes that can often save 80-90 per cent on healthcare bills. Our e-diagnostics service aims to bring a similar transparency to the lab tests market," said Prashant Tandon, CEO and co-founder of 1mg.

The company has previously raised funding from Sequoia India, Omidyar Network, Kae Capital and Intel Capital as part of HealthKart and was spun off in February 2015.

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First Published: Wed, April 20 2016. 00:36 IST
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