Key private sector players such as Merck & Co., Inc., Philips, FSD Africa Investments, and Grand Challenges Canada, alongside philanthropic organizations like the Skoll and UBS Optimus foundations, have come together to support the Transform Health Fund (THF). This diverse group of investors reflects a growing interest in Africa’s healthcare sector, particularly through the use of blended finance models. These models combine public, private, and commercial funding, creating a sustainable approach to tackling Africa’s healthcare challenges.
Blended Finance Gains Momentum in Africa’s Healthcare
Blended finance, the combination of different types of funding, is proving to be a crucial tool in advancing healthcare in Africa. The Transform Health Fund (THF) aims to support enterprises that deliver proven healthcare solutions, especially those targeting vulnerable populations. By leveraging public and private investments, THF is addressing a critical gap in health financing, which has long been reliant on donor funds.
Innovative Financing to Scale Proven Solutions
THF’s strategy focuses on scaling healthcare solutions by providing debt and mezzanine financing. This innovative business loan model, which offers flexible repayment terms based on a company’s cash flow, is designed to support companies involved in 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,” said Ziad Oueslati, AfricInvest’s Founding Partner.
Martin Edlund, CEO of Malaria No More, reinforced this view, stressing the need for private-sector investment in healthcare as donor funding declines and African countries face rising debt. This partnership between private and philanthropic investors is vital for the future of healthcare in Africa.
Strategic Investments: Addressing Immediate and Long-Term Needs
To date, THF has committed $20 million to several key ventures, including Africa Healthcare Network (AHN), Insta Products, and Kenya’s Lapaire Glasses. AHN, the largest dialysis provider in sub-Saharan Africa, and Insta Products, a manufacturer of therapeutic foods to combat malnutrition among children and mothers, are notable examples of the fund’s focus on both immediate health needs and long-term system improvements.
These investments demonstrate THF’s commitment to improving healthcare access across the continent. With sub-Saharan Africa shouldering 20% of the global disease burden but receiving minimal impact investment, THF is determined to fill this gap by focusing on locally-led enterprises that offer sustainable, scalable solutions.
Paving the Way for Health-Tech Innovation
As THF grows, it plans to expand its investments into more health-tech startups and innovative healthcare delivery models. By supporting scalable solutions that improve healthcare access across Africa, the fund is well-positioned to make a long-lasting impact on the continent’s healthcare system.
The successful close of THF, alongside its strategic investments, marks a pivotal moment for Africa’s healthcare sector. By promoting the growth of locally-driven health-tech solutions, the Transform Health Fund is playing a crucial role in shaping the future of healthcare in Africa, all while bridging the gap left by diminishing donor funding.
Source: Techpointafrica