Meet the 17-yr-old on a mission to make medicine affordable

The precocious teen found that 60 percent of Indians didn’t have access to the medicines they needed because of the high cost, brick-and-mortar stores were struggling thanks to the growing popularity of online pharmacies, and branded medicines, besides being more expensive for the end-customer, were also not profitable for retailers: Margins on them were 5 to 10 percent versus the 30 to 40 percent margins that generics offered.

With ₹5 lakh in seed capital from his parents, Deshpande reached out to manufacturers with WHO and GMP-approved facilities and convinced them to sell generic medicines directly to retailers. At the other end, he bandied together single-owner medical stores who were anyway reeling from the loss of business to online pharmacies. He aggregated the stores under the name Generic Aadhar, complete with a fresh logo, look and branding. Through these stores generics are sold directly to the end customer.

Deshpande has got four Maharashtra-based manufacturers on board at present and has franchisee agreements with 11 medical stores spread across Mumbai and Thane. Two-three Generic Aadhar employees are assigned to each store to educate customers about generic medicines. Says Ashok Kulkarni, a 76-year-old diabetes patient and a regular at one of Generic Aadhar’s stores in Mulund, “I used to worry whether the quality of generics would be the same as the [branded] medicines I used to buy. The staff here assured me that it was. They asked me to try generic medicines once and see what happens. I did so and realised they had the same effect. Now I only buy generic medicines. My monthly medical bill has come down by 50 percent as a result.”

As for store owner Vishal Thakkar, 46, joining hands with Generic Aadhar made business sense. Having owned the store for a little over two decades, he was initially sceptical about taking on a new brand identity. But after due thought he went ahead with Deshpande’s proposal and hasn’t looked back since. While the store also sells branded medicines, sales of generics have jumped, he says. “Sales have definitely improved,” he quips, without letting on how much they have climbed. In Deshpande’s estimate, most store owners have seen revenues double since tying up with Generic Aadhar.

It’s what has led medical store owners from across India to reach out to Deshpande for a franchise partnership, says the teenager. Over the next three months, Generic Aadhar will have 35 to 40 retailers under its fold, mostly in Mumbai but some also in Goa and Gujarat. “We’re expanding systematically,” says Deshpande, adding that he’s on the lookout for outside capital and is in talks with a strategic investor. In the pipeline is also a foray into online sales where customers can directly order the medicines they need; it will be delivered to them “within two hours” from the nearest franchisee store through a third-part logistics player, explains Deshpande. 

The opportunity is massive. There are 1 lakh manufacturers and around 10 lakh brick-and-mortar medical stores across India, says Deshpande, who has been shortlisted for the 2020 Thiel Fellowship in Silicon Valley, which has Oyo’s Ritesh Agarwal among its alumni. “It’s a win-win model for everyone: The manufacturers benefit, retailers get higher margins, and customers get lower prices,” he says.

Generic Aadhar also benefits from the zero-investment, asset-light model. It has a profit sharing agreement with its franchisees where the startup pockets a cool 15 percent. Already Generic Aadhar has clocked around ₹40 lakh in revenue.

So how much do Deshpande’s parents help him in his venture? “They have their own work,” he says, “but of course they are always there if I need any help or want to discuss something.”

And how does he balance the demands of college work—he’s in class 12—with his business commitments? He flashes a grin. “I bunk lectures. I don’t let college come in the way of my education.”