Funding to bolster African Health-Tech System
11th October, 2024
Pan-African investment, AfricInvest, has announced that it has successfully closed its Transform Health Fund (THF), surpassing its initial $100 million benchmark in the process. The funding, with a final figure pegged at $111 million, was managed in partnership with the Health Finance Coalition (HFC).
The Health Finance Coalition is a group of leading global health donors, development financial institutions and technical partners aiming to scale blended finance solutions for the healthcare sector.
“The Transform Health Fund demonstrates that health enterprises serving the most vulnerable communities are in fact investible””The context of static donor funding for health and unsustainable debt for African countries makes private investment in high-impact healthcare more important than ever.” said Martin Edlund, CEO, Malaria No More and Executive Director of the Health Finance Coalition.”
Several investors, including the International Finance Corporation (IFC), Proparco, Swedfund, and the US International Development Finance Corporation (DFC), backed the fund. Key private sector players like Merck & Co., Inc., Philips, FSD Africa Investments, and Grand Challenges Canada also joined the fray, along with philanthropic organisations such as the Skoll and UBS Optimus foundations.
The fund is calculated to support enterprises that deliver proven healthcare solutions, particularly those serving vulnerable populations. It also seeks to work towards boosting innovative healthcare models across Africa by addressing critical gaps in the health financing and capacity system of such healthcare models.
Transform Health Fund’s approach focuses on scaling healthcare solutions by offering debt and mezzanine financing (a business loan that provides repayment terms adapted to a company’s cash flows) to companies that focus on local supply chains, digital innovations, and affordable care delivery.
“Financing companies in Africa’s health sector through innovative models like the Transform Health Fund is crucial for addressing Africa’s health financing and capacity gaps,” stated Ziad Oueslati, AfricInvest’s Founding Partner.
“By teaming up with private sector leaders, the Transform Health Fund has become a proven model for scaling locally led healthcare solutions across the continent.” Ziad added.
Françoise Lombard, CEO of Proparco said: “Proparco is delighted to take part in the final close of the pan-African Transform Health Fund (THF) managed by AfricInvest. In a full alignment with Proparco’s strategy, this innovative blended-finance debt fund aiming to support small and medium companies in health will help to bolster healthcare systems in sub-Saharan Africa while reducing inequalities by improving financial and geographical accessibility to quality infrastructures and products.”
The Transform Health Fund made its debut in December 2022 at the U.S.-Africa Leaders’ Summit in Washington, D.C. It was established to address Africa’s massive health financing and capacity gaps. While Sub-Saharan Africa is home to 14 percent of the global population and 20 percent of the global disease burden, just 1.6 percent of annual impact investments target the healthcare sector in Africa. THF has already committed $20 million to several key ventures, including Africa Healthcare Network (AHN), Insta Products, and Kenya’s Lapaire Glasses. These investments demonstrate THF’s commitment to addressing immediate health needs and long-term system improvements.
As THF expands, it intends to invest in more health-tech startups and healthcare delivery models, offering scalable solutions that improve healthcare access across Africa. With its successful close and strategic investments, the fund is positioned to make long-term health improvements while promoting the growth of Africa’s emerging health-tech sector.
