Madhukar Gangadi, founder and CEO of offline pharmacy MedPlus, has earned two very different reputations. Depending on which of his employees you ask, of course.

Some see the doctor-entrepreneur as a maverick, plunging headlong into a new business plan every quarter. From selling products as diverse as furniture, electronics, health insurance and diagnostics to renting out space in the company’s medicine warehouse. These employees say that since MedPlus’ inception in 2006, Gangadi has suggested every possible idea, tried to execute most of them, and subsequently withdrawn from the majority of them.

Disillusioned, employees who saw business plans change like mood swings, blame him for his incoherent vision, lost faith and left the company.

Then there were others. Employees who stuck around as MedPlus became the second largest pharmacy chain. Today, it has over 1,700 stores and an online arm to boot. No mean feat since the country’s largest pharmacy chain—with about 3,200 stores—is operated by Apollo Healthcare, a profitable, listed hospital chain. MedPlus, on the other hand, became the largest private equity funded pharmacy.

As of last year, even retail giant Amazon was reportedly interested in investing in MedPlus. More recently, Bangalore-based PremjiInvest—the investment firm started by billionaire Azim Premji—saw potential for growth in the offline pharmacy space and invested over Rs 200 crore ($28.7 million) in MedPlus earlier this year. Employees who’ve seen this growth credit Gangadi’s risk-taking and out-of-the-box thinking for MedPlus’s success.

Just like MedPlus’ current and former employees, the opinions of those in the pharmacy retail sector—online pharmacies, unorganised pharmacies and other chains—are also polarised about MedPlus and Gangadi.

A senior executive with a pharmacy chain says that he stopped considering MedPlus as serious competition since Gangadi constantly oversold and under delivered. In 2008, Gangadi had claimed that he would establish over 5000 stores across the country by 2011. When that deadline arrived, just 900 stores were standing. By 2015, still at 1,230 stores, MedPlus projected it would open 10,000 stores by 2019. Less than a fifth of that target has been met.

Despite this, Surendra Mantena, COO of MedPlus, stands firmly in the camp of Gangadi supporters, and understandably so. Mantena has seen MedPlus’s revenue grow to Rs 2,115 crore ($303.5 million) in the year ended March 2018. The company managed a profit of Rs 12.5 crore ($1.8 million) in the same period.

Capital became the biggest issue. We had to constantly scout for money, change strategies, control expansion and become profitable. The idea of an IPO came up a few times. Growing while keeping EBITDA positive and facing competition from online pharmacies affected us for many years.


Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

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