The Warehouse Group buys cornerstone stake in online pharmacy business Zoom Health

The Warehouse Group buys cornerstone stake in online pharmacy business Zoom Health


Business

The Warehouse group has bought Zoom Pharmacy. Photo / Jason Oxenham

The Warehouse is expanding into the medicines market, taking a 26 per cent stake in pill delivery startup Zoom Health.

Zoom is an online pharmacy business which can deliver prescriptions to customers’ homes rather than visiting a pharmacy. The company last year raised $3 million through crowdfunded equity platform Snowball.

Companies Office records show The Warehouse is now Zoom’s second largest shareholder, behind founder David Taylor who has 32 per cent.

Taylor said Zoom Health has proved disruptive to an industry that had seen little if any innovation over many years.

It had developed and refined the Zoom offering to deliver people’s pharmacy prescriptions to them directly without having to visit the chemist.

Zoom Health was launched in 2018. Taylor said it was software-driven with medicines delivery and patient support the central driving force of the business.

The Warehouse chief executive Nick Grayston said a pharmacy service was crucial for Kiwis, particularly in current times when it was hard to get out to pick up prescription medication, but they can instead be delivered to a patient’s door via contactless delivery.

“We are aware of some medication utilisation challenges in New Zealand and we want to play a part to improve patient outcomes through this partnership.”

The Warehouse Group has been working on building a customer ecosystem that leverages its brand strength, store network and customer base, he added.

Grayston said the investment in Zoom Health complements The Warehouse existing online retail and distribution offer.

Shares in Warehouse Group are trading today at $3.80, and the company has a market capitalisation of $1.3b.

Zoom Health’s associated company Zoom Pharmacy is a direct-to-consumer pharmacy service designed to address the high levels of medicine non-adherence in New Zealand – particularly for the many Kiwis with poor access to primary care services.

The Pharmacy has DHB funding agreements that cover over 3.8 million New Zealanders and is one of the largest independent pharmacies operating in the country.

Taylor said The Warehouse’s investment will allow the company to expand the use of Zoom Pharmacy services to significantly more Kiwis.

He said The Warehouse and Zoom have a shared vision for helping improve access to affordable healthcare.

“We know that around half a million New Zealanders are not currently enrolled with a GP. Many more Kiwis may be enrolled but have poor access to GP and traditional pharmacy services. The reality is that healthcare has been failing many New Zealanders for years.

“Our new partnership with The Warehouse will provide us with the opportunity to bring an advanced, affordable healthcare solution to potentially millions more Kiwis,” Taylor said.

Taylor said the additional funding will be used to improve dispensing infrastructure, software development and further investment in people.



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