New Delhi: Mumbai-based pharmacy aggregator PharmEasy has closed a $17-million deal (around Rs 111 crore) in a series-B round by three of its existing venture capital investors, said a person aware of the deal.

The funding indicates continued interest in the online pharmacy segment despite a reported dip in the total investment secured by startups in this space. PharmEasy’s latest round of funding was led by Silicon Valley’s Bessemer Venture Partners, according to the person.

Mumbai-based Orios Venture Partners as well as Aarin Capital — the investment firm of Manipal Group’s Ranjan Pai and former Infosys finance Chief Mohandas Pai — also participated in this round.

In December 2016, the three were in advanced talks to participate in a $18-million round in the e-pharmacy application, which had raised $5 million in Series-A in 2015.

Confirming the funding, company’s Co-Founder Dhaval Shah disclosed that the medicine delivery platform, which connects patients with pharmacies nearby, plans to use the money primarily for growth and to expand to 15 more cities by 2018-end. However, he said the cities had not been decided yet, but some of them could be tier-II towns.

PharmEasy, operational in Mumbai, Bangalore, Delhi, Pune, Ahmedabad, Kolkata and Jaipur, has catered to over two million families since its inception, Shah pointed out.

Bessemer Venture Partners, Orios Venture Partners and Aarin Capital did not respond to ET’s emails about the development by the time this story went to press.

According to investors like MAPE Advisory Group, increasing clarity in the regulations for online pharmacies has made the segment more attractive. The group’s chairman, Ramprasad M told, that the funding that an online pharmacy will be able to secure is based on its business model and focus on profitability.

“Not everyone is going to get investments because the business model is an important factor in deciding this besides the management team, which should understand technology and have pharma domain knowledge,” he said.

Since 2015, platforms, such as Netmeds, PharmEasy, Myra and 1mg, have secured funding from various venture capital investors and private equity funds. Online pharmacies reportedly received a total funding of $28.45 million (about Rs 186 crore) in 2016.

A sector report by the Federation of Indian Chambers of Commerce and Industry said India’s online pharmacy segment is expected to account for up to 15% of the country’s total pharma sales, especially because of the increasing internet penetration. The country’s pharmaceutical market is expected to grow at 15% annually to touch $55 billion by 2020.

Source: The Economic Times