MedScore helps pharma distributors reduce bad debts and manage credit better

When Mannuri Vamshi Krishna was just 13, his father died of tuberculosis—not because treatment was unavailable, but because medical help didn’t arrive in time. 

“We spent three years going from hospital to hospital, but help never came in time. There wasn’t a shortage of medicines. It was the delay caused by systemic inefficiencies and lack of coordination in the healthcare system. The healthcare system failed where we lived,” recalls Krishna.

Growing up in Nizamabad, a small city in Telangana, he saw first-hand how rural healthcare access was not just about doctors or medicines but about how efficiently the system functioned. In his father’s case, the issue wasn’t the absence of a pharmacy in the city, but the lack of reliable supply chains, transportation, and coordination to ensure medicines reached patients on time. The delay arose from poor logistics, limited cold-chain infrastructure, and the absence of last-mile delivery systems.

This early experience gave him a deep understanding of the structural inefficiencies that plague India’s healthcare delivery.

To support his family after his father’s passing, Krishna dropped out of school and began working at a medical store in Nizamabad. What started as a necessity soon evolved into a lifelong engagement with the pharmaceutical supply chain. He went on to work with a wholesale distributor for over eight years, followed by a stint as a medical representative, and eventually he rose to become the regional manager for Andhra Pradesh and Telangana.

Over more than a decade, Krishna witnessed both urban and rural healthcare markets up close. “What I saw again and again were systemic gaps, not in science, but in infrastructure. Distributors had no visibility on retailer credibility. Payments were delayed, credit was blind,” he says.

This realisation led Krishna to a critical insight: infrastructure gaps in healthcare aren’t just physical, they’re financial too. India’s pharmaceutical trade largely runs on informal credit cycles. Distributors extend 30–45 days of credit to pharmacies without any structured way to assess risk. Defaults are widespread, undocumented, and deeply disruptive.

Krishna explains, “Bad debt is a recurring pattern that eats into working capital, damages margins, and ultimately affects access to medicines, especially in smaller towns where credit is the only way stock moves.”

This became the foundation for MedScore, a credit-risk intelligence platform designed specifically for the pharmaceutical supply chain.

Founded earlier this year, MedScore works like a credit bureau for pharmacies. It collects real-time billing and payment data from drug distributors, builds credit profiles of retailers based on their payment behaviour, and generates reports that help distributors decide whom to extend credit to and how much risk is involved.

Building a credit intelligence network

The idea of MedScore began taking shape in August last year when Krishna, along with two former colleagues, a tech professional and a chartered accountant, started building a proof of concept. Their focus was simple: gather transactional data from drug distributors, including payment timelines and credit history, and use it to score pharmacies on their repayment behaviour.

“There are credit bureaus for consumers,” Krishna says. “But no one tracks how pharmacies treat their suppliers. That’s the blind spot we set out to solve.”

The Medscore platform collects data from invoices, including how much was billed, how much was paid, and how long the payment took. The data shows exactly how much a retailer owes to the distributor, how promptly they pay, how late their payments are, and how they behave with other distributors in the region. 

A pilot project with 50 distributors across Telangana, Andhra Pradesh, Maharashtra, and Delhi gave the Medscore team access to billing data from over 10,000 retail shops. This validation led to the official incorporation of MedScore in January this year, based in Hyderabad. 

Unlike traditional credit assessment tools that rely on outdated or incomplete records like GST filings or tax documents, MedScore’s system is built on tamper-proof, real-time data pulled directly from the billing software of distributors.

“Retailer data is considered sacred in this industry. But what surprised us was how ready people were to share it if it helped reduce risk, specifically the risk of payment defaults. The platform helps distributors avoid unreliable buyers and protect their working capital,” explains Krishna.

“Distributors treat billing data as sacred. Getting access means earning their trust every single day,” he adds. 

MedScore’s product is built in-house, giving the team control over feature development and data architecture. All data collection is consent-based and in compliance with India’s Digital Personal Data Protection Act. The data stays with the distributor and is not shared with retailers, emphasises Krishna. 

The platform runs on a pay-per-use model, charging Rs 2 per invoice. The company has also added subscription-based offerings, data licensing for NBFCs, and collaborations with ERP providers to its revenue mix.

Creating widespread impact

Drug distributors use the data aggregated by MedScore to assess a retailer’s creditworthiness before giving new credit. For example, if a retailer has delayed payments with others in a region, the distributor may choose to pause, reduce credit limit, or ask for upfront payment. This helps reduce the chance of bad debt. 

Also, knowing which retailers usually pay late helps distributors follow up in advance, thus improving collections.

If a distributor marks a retailer as a ‘defaulter’, MedScore sends a real-time alert to distributors in the network. “The system creates shared awareness,” says Krishna.

Today Medscore aggregates invoice-level data to build credit profiles for over 1.57 lakh retailers across Telangana, Maharashtra and Delhi. It generates over 3,000 credit reports every day and supports more than 360 distributors, many of whom had never used structured credit evaluation tools before.

The platform is also enabling regional distributors to expand confidently into new territories. “Earlier, a distributor might hesitate to enter a new district because they didn’t know the market players. Now, with access to credit behaviour and transaction patterns, they’re able to grow with confidence.”

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The startup operates in a niche space with few direct competitors. While players like CIBIL, CRIF, and Experian offer generic credit scores, they don’t track real-time trade behaviour in sectors like pharma. Others like Crediwatch, Bureau, and OkCredit have overlapping features but they aren’t purpose-built for pharmacy-distributor dynamics. 

Expanding the framework 

MedScore was started with a modest investment of around Rs 15 lakh from the founding team. In March, it raised a Rs 2.1 crore seed round from a Hyderabad-based public technology company and two angel investors. 

Having reached an “inflection point” in just a few months after launch, MedScore is ready to scale up, without compromising on accuracy, reliability, and respect for data. “The platform is built, the data is flowing, and the demand is organic. We now need to build the depth—more integrations, analytics, and scale,” says Krishna. 

While MedScore remains focused on the pharma sector, the startup is developing a broader platform called SafeCredits that applies the same credit intelligence to other sectors such as FMCG, retail, and manufacturing. It is also collaborating with the Drug Control Board in Telangana to offer real-time dashboards that track pharmaceutical transactions and stock movement across the state to prevent misuse and stockouts. 

The startup is in the process of raising $1 million to expand operations across 10 Indian states and onboard more than 2.5 lakh active retail users.

Talking about the challenges of scaling, Krishna says, “It’s about respecting local business cultures. Each region has its own operating norms, regulatory nuances, and distributor behavior. What works in Telangana may not work in Gujarat or Bihar.” 

Krishna believes MedScore’s model can travel around the world; it has already received early interest from Malaysia and Indonesia. 

For Krishna, it always comes back to where he started: a boy in a village, watching his father fight an illness they couldn’t afford to treat properly. 

“If we can reduce the financial friction in the system, we can unlock better care and get medicines to people faster by helping distributors manage credit better. That’s what drives me every day,” he says.