EchoVC Partners, a Lagos-based venture capitalist, and Fola Laoye, an angel investor, must have seen enough to know that the gaps in Nigeria’s health sector present life-changing opportunities for interested firms.
Around June 2018, they invested $200,000 in Lifebank to enable the start-up expand its blood delivery beyond 9,000 pints and drive revenue above $100,000.
Money is flowing into solving Nigeria’s health problems, with a new set of genuine start-ups positioning themselves and re-calibrating their business models to grab the opportunity.
“Investments, especially Foreign Direct Investments (FDIs), have impacted the Nigerian health sector,” said Doyin Odubanjo, chairman, Association of Public Health Physicians of Nigeria, Lagos chapter.
“Some hospitals and diagnostic centres with expensive high-tech equipment that are existing today were made possible by such investments,” Odubanjo said.
54gene, a genomics company focused on African DNA, raised $4.5 million from a group of investors, including Y Combinator, Fifty Years, Better Ventures, KdT Ventures, Hack VC and Techammer. The money will be used to create the first African biobank. In February this year, the Nigeria Sovereign Investment Authority (NSIA) provided $11 million (N3.96 billion) worth of sophisticated equipment and renovation cancer treatment centres for the Oncology Department of Lagos University Teaching Hospital (LUTH), Idi-Araba.
Similarly, in June this year, MDaas Global, a start-up focused on providing diagnostics services, raised $1 million in a seed round led by Consonance Investment Managers with participation from Techstars, FINCA Ventures, the Fund for Africa’s Future and Greentree Investment Company.
Oluwasoga Oni, MDaaS Global’s CEO and co-founder, said the funding round fuels the company’s next phase of growth, allowing it to continue providing modern, connected healthcare for Africa’s next billion.
“With diagnostics as the bedrock of modern medicine and key to the treatment of diseases like cancer, heart disease, and diabetes – which are on the rise within the continent – unbridled access to quality healthcare is crucial,” Oni said.
“We are immensely proud of our brick-and-mortar presence. Merging physical patient care with state-of-the-art technology enables us to reach more patients with the care that they deserve,” he said.
Already, Founder’s Factory Africa (FFA), an investment firm, has partnered South Africa’s Standard Bank to invest £30,000 to £100,000 to five start-ups. The FFA has lined up 35 healthcare start-ups across Africa to fund.
Nigeria has a number of health challenges on its hands. Cancer kills 72,000 people annually, according to official data. The country has seven chemotherapy machines for cancer patients, but only two are functioning.
The World Health Organisation (WHO) data show that influenza and pneumonia kill 305,460 Nigerians each year, with diarrhoeal diseases sending 186,218 annually to their early graves.
Over $1 billion is spent annually on medical tourism by the few rich, with maternal mortality rate as high as 821 per 100,000 live births as against Kenya’s 540.
The WHO says that Nigeria’s physician-to-patient ratio is four doctors per 10,000 patients. Out of 72,000 doctors registered with the Medical and Dental Council of Nigeria (MDCN), over 50 percent practise abroad, BusinessDay found.
But these challenges have been turned into opportunities for firms willing to create solutions for them.
While Mother’s Delivery Kits has secured an undisclosed amount of money from a United States agency to reduce maternal mortality in rural areas, Helium Health, which provides hospital management software that helps healthcare institutions digitise their operations and patient records, raised $2 million recently. In September, Kasi Healthcare will launch its $4 million investment for robotic surgery centre births in Nigeria led by Lokmanya Hospitals India.
However, investments in the health sector are relatively low when compared with those of fintech, energy and education.
“Attracting FDI into the healthcare sector requires deliberate policy work by government,” Chibuzo Opara, co-founder of Drugstoc, who has also secured some new investments, said.
“We have to ensure that investors are attracted to the healthcare industry. For instance, this could start with including healthcare into the National Industrial Revolution Plan, among other similar tools utilised to drive investments into the country,” he said.
Hammed Ninalowo, a vascular and interventional radiologist, said Nigerian government should start looking at regulations that make things easier for the health sector.
Adedayo Faduyile, national president, Nigerian Medical Association, said there is a need for a structured approach to encourage FDIs into the domestic economy.
Faduyile said the traditional way of delivering healthcare has led to thousands of deaths and serious injuries, noting that the use of technology would give a proper record of patients and reduce the risk of misdiagnosis and wrong medications.
ODINAKA ANUDU, ANTHONIA OBOKOH & GBEMI FAMINU
