The RA Williams journey from start-up to market
Published:Wednesday | July 17, 2024 | 12:06 AMSteven Jackson/Senior Business Reporter
Fed up with expensive drugs, Audley Reid, then an adolescent, co-founded RA Williams Distributors Limited during the 2009 recession.
The company based in Spanish Town, St Catherine distributes medicines nationally. It started simply: trying to solve the problem of sourcing “affordable” medicines.
Reid and his co-founder sister, Jewel Reid, grew the company from a start-up to $1.5 billion in annual sales. It plans to list on the Jamaica Stock Exchange and raise $400 million in the process from market investors.
RA Williams has surpassed the revenue of companies nearly twice its age, fuelled by partnerships with eight generic drug manufacturers in India and Bangladesh. It holds exclusive distribution rights for half of the 130 medicines it sells.
The Reid family’s journey started humbly in rural Jamaica. “It isn’t a unique story, but it is authentic,” said co-founder and CEO Audley Reid CEO, at the investor briefing hosted by lead broker Sagicor Investments Jamaica Limited on Monday.
The company’s origin story involves three Williamses: Evelyn, Ransford, and the late R. Danvers. At the time, Evelyn Williams, the mother of the Reid children, ran a pharmacy in Chapelton, Clarendon. The family realised that several patients were unable to afford even the lowest-cost generic drug options.
“We were certain that there was a better way,” said Reid.
Room to grow
RA Williams still has room to grow. It won about 2.0 per cent or $500 million of the $27 billion public sector drugs market contracts issued by the National Health Fund for the 2023 to 2026 contract cycle. Its seven main competitors are Facey Commodity, Lasco Distributors, Massy Distributors, Medimpex, Cari-Med, Indies Pharma, and Medical Disposables and Supplies. RA Williams sales are nearly half of Medical Disposable’s $3.2 billion, but above Indies Pharma’s $1.1 billion – two companies that already trade on the JSE’s junior market that RA Williams is now trying to list on.
Reid hasn’t ruled out mergers and acquisitions in the future. The company also intends to expand overseas, although such plans remain in the early stages.
The company was named in honour of Ransford Anton Williams, the grandfather of Reid and father of Evelyn Williams. It was incorporated in 2009, received its licences in 2010 and started operations from Clarendon. Then in 2012 it moved to Spanish Town. And in 2015, business icon and investor R. Danvers ‘Danny’ Williams joined the board.
“He was no less impactful on our lives but particularly my life. I sat at his feet,” said Reid. Williams was a business mogul who made his fortune through insurance. They met in 2006 while Reid was in his final year of high school, and Williams was the chairman of the board of Jamaica College. Reid wanted to start the company just after high school, but Williams stressed the importance of tertiary education. Reid is a registered pharmacist.,
The initial public offering of shares in RA Williams opens today, Wednesday and closes at month-end. A fully subscribed offer would reduce the holdings of Ranwill International, held by the Reid co-founders and Evelyn Williams, from 49.4 per cent to 39.5 per cent. It would also reduce the holdings of chairman John Bailey from 24.7 per cent to 19.75 per cent, and Ravers Limited, the estate of ‘Danny’ Williams, from 24.7 per cent to 19.75 per cent.
Beyond 2024, RA Williams expects to grow revenue by focusing on selling more over-the-counter drugs, or OTCs for short. OTC drugs currently account for a bit over $120 million or eight per cent of total sales. The CEO thinks the company can achieve more from that segment.