Retail pharmacy chain Goodlife Pharmacy stands as the largest of its kind in East Africa, boasting over 70 outlets across Kenya and Uganda. Established in 2014, Goodlife has been dedicated to lowering barriers for patients to access high-quality healthcare in the region, offering world-class services, medicines, and overall experience.
The Genesis of Goodlife Pharmacy
In 2012, public health specialist Joshua Ruxin and investor Jeffrey McCormick joined forces to delve into investment opportunities within Africa’s health sector, with a particular focus on establishing a regional retail pharmacy chain. Soon after, David Zapol, previously leading the health practice at a global consulting firm, joined them. Together, they officially launched Goodlife Pharmacy in 2014.
Strategic Acquisitions for Rapid Market Entry
Goodlife aimed for a swift entry into the Kenyan market. Instead of constructing new stores and corporate infrastructure, which would be time-consuming and costly, the company prioritized acquisitions. It successfully acquired the four-store Mimosa Pharmacy chain, building upon the existing goodwill and relationships that Mimosa had cultivated within the industry.
Addressing Fragmentation in the Pharmaceutical Retail Industry
The East African pharmaceutical retail industry is characterized by fragmentation and informality. Less than 10% of the thousands of pharmacies belong to an organized group. These stand-alone mom-and-pop outlets typically stock a narrow range of products, often of poor quality and sometimes past their expiry date.
The Role of Local Manufacturing
Kenya’s pharmaceutical manufacturing industry is relatively developed in Africa, although production costs remain high due to significant utility expenses and infrastructure limitations. While Goodlife sources products from local manufacturers, it continues to import a considerable volume of products.
Read also: Hair Care Hype: Moroccanoil
According to Amaan Khalfan, the production of high-quality pharmaceutical products is rising in Kenya.
Growth and Profitability Initiatives
Goodlife has implemented several initiatives to grow its store footprint and profitability. In the past three years, its store count has expanded four-fold and over 90% of these outlets are profitable.
Technological Advancements and Efficiency
Leapfrog’s capital injection enabled Goodlife to implement IT systems that consolidated data from all its stores. “This centralised IT system provided better data so we could make decisions much quicker … We are able to see, at the touch of a button, each of the 70 stores.
In recent years, Goodlife has been able to reduce the capex spending on its new stores by over 50%. By using tools introduced by its private equity partner, Goodlife has also improved in terms of site selection. For its neighbourhood format outlets, it introduced a prefabricated store concept. This model offers a four-week build and installation period for new stores based on a simple design, compared to an eight to 12-week period in a standard greenfield model.
Becoming a 'Health Hub'
Part of the company’s original vision was to become a ‘health hub’. It recognised that pharmacies are the first point of contact for many Kenyans seeking care and that offering select healthcare services would be a key differentiator in the market. In 2018, Goodlife began to build these services into its business model by developing partnerships with healthcare providers that had relevant services and expertise.
Read also: Waste to Wonder: Flip Flop Art
E-commerce and Online Presence
Goodlife has launched an e-commerce offering and accepts prescriptions online. This channel has seen a significant boost in sales as a result of Covid-19. “We realised many customers were staying at home, so we launched a delivery programme … through our e-pharmacy platform.
How to Order Medicines On Netmeds
Combating Unscrupulous Practices
Within the East African pharmaceutical industry, there are unscrupulous players selling substandard products at lower prices. Some suppliers also import products through non-traditional channels to avoid duties and taxes. The pilferage of stock from retail outlets is also a major challenge in East Africa.
However, according to Khalfan, Goodlife has implemented systems to significantly reduce stock losses.
Expansion into Kakuma with IFC Support
Goodlife Pharmacy Kakuma is one of dozens of businesses establishing a presence in and around Kakuma with support from IFC's Kakuma Kalobeyei Challenge Fund (KKCF). An opening ceremony and ribbon cutting at the new pharmacy held today was attended by H.E. Hon.
Read also: Discover Sentrim Elementaita Lodge
"Thanks to the support of IFC, this launch marks a significant milestone for Goodlife Pharmacy as we expand our portfolio of over 115 locations in Kenya and Uganda," said Goodlife's Melvin.
"Congratulations to Goodlife, whose presence in Kakuma will improve access to quality health products and services making it more convenient for those seeking medication," said IFC's Arif.
Goodlife Pharmacy is one of over 40 companies that have benefitted from IFC's KKCF, which offers incentives to small and medium-sized businesses seeking to provide essential goods and services in the Kakuma and Kalobeyei area.
KKCF is also working to attract larger private sector companies, like Goodlife Pharmacy, to the area, by providing hands-on support and advisory services to companies. Goodlife Pharmacy committed to expanding into Kakuma following the 2018 publication of IFC's "Kakuma as a Marketplace" study, which highlighted the economic pursuits, challenges, and potential of the area.
KKCF provided financial, logistical, and employee recruitment support to Goodlife Pharmacy during its entry into Kakuma. KKCF is a five-year program designed to support private sector investment and unlock the economic potential of refugees and their hosts in the Kakuma-Kalobeyei refugee-hosting area in northern Kenya.
KKCF aims to attract private companies to the area and support local entrepreneurs to create jobs and improve service provision in the Kakuma area. KKCF is supported by five development agencies: The Ministry of Foreign Affairs of the Netherlands, the Swiss Agency for Development and Cooperation (SDC), the German Federal Ministry of Economic Cooperation and Development through KfW, and the UK's Foreign, Commonwealth and Development Office (FCDO), and the European Union.
Impact and Reach
Goodlife Pharmacy is the largest pharmacy chain and health hub in East Africa, reaching 1.7 million people with access to essential medicines across 115 locations in Kenya and Uganda. Goodlife provides trusted pharmaceuticals and high-quality over-the-counter medicines to its patients, as well as individual customer care, beauty and personal care products, and digital and home delivery services.
Investment and Expansion
In 2022, Toyota Tsusho Group acquired a 30% stake in Goodlife through CFAO, marking its first entry into the retail pharmacy industry in Africa. By acquiring 100% ownership of Goodlife, CFAO will further strengthen the integration between Goodlife’s retail network and brand and its own healthcare operations, aiming to improve consumer access to high-quality pharmaceuticals in Africa and accelerate their widespread availability.
LeapFrog's Role in Goodlife's Development
LeapFrog led the recruitment of experienced executives, including Amaan Khalfan (CEO) and Justin Melvin (COO), as well as mid-level managers across core functions, including a Chief Pharmacist, Head of Purchasing, Internal Auditor, IT Manager and Marketing Director.
During the COVID-19 pandemic, LeapFrog worked closely with management to rapidly launch an online pharmacy/ delivery platform. Working with management, LeapFrog led a complete overhaul of Goodlife’s supply chain and procurement infrastructure, driving significant gains in efficiency. LeapFrog’s support and presence on the cap table helped Goodlife crowd in additional capital.
With LeapFrog’s support, the company made substantial strides in strengthening its Environmental and Social (E&S) framework, including enhanced safety protocols, better waste management, and the introduction of energy efficiency measures. IFC was an existing lender to the business at LeapFrog’s entry and successfully exited in 2022.
Commitment to Quality and Affordability
The Toyota Tsusho Group remains dedicated to contributing to solving social issues and economic growth in Africa under the key message, “for the future children of Africa,” at the 9th Tokyo International Conference on African Development (TICAD 9) to be held in Yokohama this summer. In Africa, the circulation of counterfeit pharmaceuticals poses a threat to human life and remains a public health challenge. Improving access to affordable, high-quality medicines will also help address this issue.
Goodlife Pharmacy Competitors
Here are some of Goodlife Pharmacy competitors:
- mPharma: Operates as a technology company providing financial and inventory management solutions to support hospitals and pharmacies in maintaining stock levels of medications.
- Guardian Health: A retail pharmacy chain focused on providing healthcare products and services, including prescription medications, over-the-counter remedies, and health screenings.
- Healthlane: Operates in the health and wellness sector, offering services including in-depth health tests, personalized health insights, and tools for tracking and improving health.
- Clafiya: A healthcare platform that provides accessible and convenient healthcare services, offering a Health Savings Account (HSA) and virtual/in-person medical consultations.
- Lifebox Labs: A telehealth company focused on modern healthcare solutions for chronic diseases, developing digital products aimed at delivering evidence-based therapeutic interventions.
- AfriLife: A company focused on providing beauty and personal care products within the health and beauty industry, offering a range of makeup, skin care, and hair care products.
Milestones of Goodlife Pharmacy
The following table summarizes the key milestones in the development of Goodlife Pharmacy:
| Year | Milestone |
|---|---|
| 2012 | Joshua Ruxin and Jeffrey McCormick explore investment opportunities in Africa's health sector. |
| 2014 | Goodlife Pharmacy is officially launched. |
| N/A | Acquisition of Mimosa Pharmacy chain to quickly enter the Kenyan market. |
| 2018 | Partnerships with healthcare providers to build healthcare services into the business model. |
| N/A | Launch of e-commerce offering and online prescription services. |
| N/A | Expansion into Kakuma with support from IFC's KKCF. |
| 2022 | Toyota Tsusho Group acquires a 30% stake in Goodlife through CFAO. |
Popular articles:
tags: #Kenya
