With over 400 million chronic patients, India is one of the world's largest medicine markets. But while most e-pharmacies chase speed, affordability remains the real challenge. Truemeds took a different route: helping patients switch to lower-cost substitutes, a bet now paying off with new funding at about four times its previous valuation.
The six-year-old startup has raised $85 million in a new round that includes $65 million in primary and $20 million in secondary funding led by Accel, along with participation from Peak XV Partners. TechCrunch first reported on Accel's talks to back Truemeds last year. Existing investors WestBridge Capital and InfoEdge Ventures, also participated.
The fresh round has boosted Truemeds' valuation to over $400 million, up from the $110 million in its last round two years ago.
Founded in 2019, Truemeds entered the market at a time when India's online pharmacy space was already crowded with major players offering steep discounts on branded generics. But some of those companies struggled to sustain early momentum -- Prosus Ventures-backed PharmEasy, for instance, saw its valuation drop from a peak of $5.6 billion to under $600 million, while 1mg was acquired by Tata Digital, part of the Tata Group. Instead of competing head-on, Truemeds' founders chose to focus on a relatively niche segment: generic medicines.
"There is no way to educate the user that you can have more affordable options if you can't afford these drugs," said Truemeds co-founder Akshat Nayyar (pictured above, left) in an interview. "That is where we felt that nobody in the value chain was working towards that, and we can bridge that gap."
The Mumbai-based recommends generic alternatives to consumers for the branded medicines they need. This eventually helps consumers save money, as generic drugs are typically more affordable than their branded versions due to cost efficiencies in their development process.
Truemeds says its differentiated approach has paid off, with revenue growing over 66% year-over-year to ₹5 billion ($57 million) in the last financial year. The startup says it retains more than 15% of its revenue after 12 months and now serves an average of 500,000 customers each month, with a total of 3 million customers to date. Moreover, it says it now serves over 20,000 postal codes across the country, with more than 75% of its customers coming from tier-2 cities and beyond.
However, educating customers about alternatives to their prescribed medicines -- and convincing them to switch from branded drugs to generics -- remains a challenge.