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

The Warehouse Group is entering the medicines market with an investment into the health tech business.

The national retailer has bought health technology company Zoom Health, an online pharmacy business which can deliver prescriptions to customers’ homes rather than visiting a pharmacy.

“The Warehouse Group has become a cornerstone strategic investor of Zoom Health Limited – a health technology company and shareholder in Zoom Care Limited, an online pharmacy delivering prescription medicine to patients,” the company said.

Companies Office records show The Warehouse Ltd has a 26 per cent stake in Zoom Health and is the second-largest shareholder.

Zoom Health’s largest shareholder with 32 per cent is multimillionaire David Taylor of Coatesville who also founded that business.

Taylor said at Zoom Care that he has been in the medicines industry for more than 30 years.

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

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 believe that through this investment, we are helping make a difference to New Zealanders’ welfare in a way that provides convenience and affordability,” Grayston said.

“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.”

Together Zoom and The Warehouse Group have a vision to “offer convenient and affordable access to healthcare to all Kiwis”, which aligned with TWG’s purpose of “helping Kiwis live better every day”.

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

“We believe that the investment in this promising digital health company will complement our existing offer and our expertise in online retail and distribution.

“We are pleased to be able to support New Zealanders’ access to cost-effective medication solutions, and we are excited to provide Zoom with additional capital and our retail expertise to accelerate Zoom’s growth initiatives,” said Grayston.

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.

Their proactive highly personalised pharmacy service is specifically designed to improve medicine adherence rates, a key mechanism advocated by the World Health Organisation to support better health outcomes in disadvantaged populations.

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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