HMi meets… Sylvana Sinha

The founder of Praava Health talks about healthcare in Bangladesh, how she has worked with the government and fundraising during a pandemic.

Praava Health is one of the most exciting healthcare companies in the world. Founded only six years ago, it is now the largest private healthcare group in Bangladesh.

Originally a network of family health centres based in Dhaka, it has evolved into diagnostics and pharmacies too. What makes it stand out is its brick-and click in-clinic model which eases the pressure both on the health system as well as the patient.

What is particularly noteworthy about Praava now is that the way that founder and chief executive Sylvana Sinha pivoted the company towards telemedicine when Covid-19 hit Bangladesh. In what seems to have been almost a seamless manner, it started to develop remote healthcare services and supported government efforts with a free hotline in early March and sample collection for Covid-19 testing.

Sinha is as impressive as her company. A foreign policy advisor to the 2008 Presidential campaign of then-Senator Barack Obama, she is also a life member of the Council on Foreign Relations and a member of National University of Singapore Medicine International Council. Over the years she has worked for international law firms, management consultants, the World Bank, as well as think tanks in the Middle East and South Asia advising governments in Afghanistan, the Middle East and Asia.

Here, she talks to HMi about how Praava Health has grown during the coronavirus pandemic, how she has worked with the government and the challenges of fundraising.

The following transcript of HMi’s interview with Sylvana Sinha has been edited for brevity and clarity.

How has Praava Health negotiated Covid-19?

When the crisis first hit, we immediately just started doing daily hands-on meetings, just to stay on top of what was happening, and we were getting requests from organisations like the UN and others. But we’re an outpatient facility and we very quickly decided to focus on just keeping people out of hospital.

People still have diabetes and cancer at the same rate that they always did. But also I was trying to figure out how can we serve Covid patients during this time. We were the first private lab to get testing approval and that was in early May.

Demand for our regular services had fallen because everyone was putting off elective procedures, and we thought: ‘We have all this capacity and all these doctors and nurses. How can we support the country during this crisis?’ We set up a free hotline for patients, in fact, we were the first private provider to partner with the government on their free hotline as well.

Even before we were doing testing, we were doing collections on behalf of the government.

The team just jumped in and we tried to figure out how we could help and allocate the resources that we had in place.

How has your relationship with the government developed?

We’ve strengthened our relationship with the government during this time and that’s been a privilege. Initially, it gave us the approval to do testing – the government was sending its own VIP samples to our lab because they felt that they trusted us. It is worth pointing out that in Bangladesh, the government has never been the leading force in health services – 72% of health spending is coming from the private sector.

There’s a really strong civil society and NGO sector which have been instrumental in the improvements and social development indicators that we’ve seen evolve in the last generation. During the pandemic, even the UK and US governments were not really prepared. Bangladesh was no exception. But at the working level, we have strengthened our relationships with the health ministry as well as with the government labs, and the international agencies.

It has been wonderful to build those relationships and to gain the trust of those communities as well.

Has the pandemic been the magic bullet for telemedicine?

I do think that people have become more accustomed to it; not just patients but also doctors. But the jury’s still out on what will happen post-pandemic. Some people will still really want to revert back to seeing their doctor and we’ve already seen some of that in more developed markets.

We’ve seen the rise in funding for healthtech rise dramatically. The third quarter of 2020 was one of the highest quarters ever for digital health funding. But it’s also interesting if you look at the big digital health deals that are happening, like Babylon Health [which secured US$550m investment in Series C funding in August], the company is opening clinics now. I still strongly believe that you can’t have telemedicine without clinics.

We’ve firmly invested in building out quality infrastructure in Bangladesh. Digital health can’t be the silver bullet by itself, because if all you’re doing is building networks to increase access to quality of care, then there’s a limit to what you can achieve.

How much of an issue is connectivity for telemedicine apps in the country?

In Bangladesh almost 100 million people out of 170 million people have access to the internet. It’s not where it could be but it’s definitely not bad. One of the things we’re doing is setting up collection points, even a few outside of Dhaka, for Covid testing and non-Covid samples. We’re trying to set up telemedicine booths in those centres as well so that if you
don’t have the internet on your phone or in your house or if you’re in a remote area, you can still do a video consult with a doctor sitting in Dhaka.

The thing that’s interesting for us is that the telemedicine actually makes our services a lot more accessible because we can offer them to people all across the country, and because it is just a phone call, it is at a cheaper price point than a clinic visit. This is a big opportunity to start to serve a different level of the population, and in an economy that’s growing so fast. These are the people who are going to graduate into the lower middle and middle classes. Our GDP per capita exceeded even that of India this year.

How does the brick-and-click in-clinic system work? Are you changing strategy for good now?

We were not planning to roll out telemedicine and e-pharma until 2021. And then this hit, and all of a sudden, we wanted to serve our patients. They need drugs they don’t have to leave their house. We have a pharmacy so let’s roll out e-pharma, and we did that in early May. And same with telemedicine. The need for brick-and-click models is more and more
pronounced. It’s really been exciting to see that side of the business accelerate so dramatically.

You have said in the past that Praava has found it harder to attract investment than expected. Why?

There are three levels of challenge. One, Bangladesh is still not considered a sexy investment destination. There are only a handful of venture capital firms that have made investments into Bangladesh. The second thing is that healthcare investors generally want a bigger ticket size.

We’ve raised close to US$10m in equity and we’ve done quite a bit with a relatively small amount of money.

We are currently in the market with our B round to US$10.6m. I can do a lot with US$10.6m, but large private equity firms start ticket sizes at a minimum of US$25m to US30m. They don’t want to start talking to me until I can absorb US$50m.

And the number three reason is that the VCs that are looking at Bangladesh are really focused on pure tech models. They are not really familiar with this brick-andclick concept. That’s a really interesting thing to me because if you look at the big deals that have happened in public markets in the US this year, for example, One Medical or Oak Street Health. I mean, One Medical IPOed at ten times revenues and they’re not profitable. Oak Street Health IPOed at 17 times revenues, it is also not profitable, and it is currently trading at 40 times revenues. But the venture firms that are looking at frontier markets don’t quite have that imagination yet. They feel that they’re already taking so much risk going into a frontier market, they want to get almost a guarantee of a tech multiple. The money that we’ve raised has really all been from angels and we have one Singapore family office.

When do you hope to get your second round finished?

I’d love to close it as soon as possible but given what’s happening in markets globally, fundraising activities are slower and due diligence trips are harder to schedule. Realistically I’m hoping to close in the first quarter of 2021.

How has the healthcare landscape changed since you set up Praava?

There’s more and more appetite for quality healthcare services. Before the [Covid-19] crisis, you had more than US$2bn a year going outside the country for healthcare. A lot of that was from people in the middle class. The Indian Embassy issues thousands of medical visas every day. That problem persists.

People feel that they can’t really trust the [domestic] healthcare system because the supply isn’t able to keep up with demand, which harks back to my previous comment about the lack of real capital dedicated to solving this problem. We need investors willing to invest in creating systemic change in these markets. It’s not going to happen by itself. We’ve had to fight really hard to get to where we are and I’m proud of that but there need to be ten more Praavas. We’re solving different pieces of the healthcare system and we’ll try to do our part, but there are so many needs in the country and so much demand. The supply is just not keeping up with that.

What are your priorities for the next 12 months?

It’s been a tremendous period of growth for us and we’ve grown our patient base dramatically. We had 40,000 patients in March and we now have 100,000, so we’re focusing on what those patients need. As we’ve rolled out new digital channels, we have tried to pull those patients into them but we also want to see what their experience is and whether they are enjoying it. Do they still prefer the clinic experience? There’s really a need for both. That’s really our near-term focus for the first half of 2021.

We also plan to launch a patient super app. We did launch our patient app about two years that was mainly focused on medical records and booking appointments, but the idea is to roll out a patient super app where you can access telemedicine, order drugs, track biometrics for chronic disease sufferers and ideally again prevent escalations and hospitalisations that way. We want to bring value-based care to Bangladesh.