The idea of putting up a Generika Drugstore came about when Mr Teodoro Ferrer, then a newly

retired Ayala executive and his business partner Mr Julien Belo saw the plight of many Filipinos
when it comes to healthcare specifically the intake of medicine and the completion of treatments that
involves antibiotics. They noted that due to the high cost of medicines, people tend to take shortcuts
in their medication without realizing the health risks it involves.

This is what prompted them to put up a business venture that aims to offer quality affordable generic
medicines that will help each Filipino live a healthy life. This partnership gave birth to Generika
Drugstore - the pioneer champion of generic medicines in the pharma retail space.

Generika Drugstore came from modest beginnings; Generika’s first office was a small 2-bedroom
apartment in Goodwill Village, Parañaque City. It was a huge risk for both partners since none of
them had a background in the healthcare industry, let alone in running a retail business. Gradually,
the company grew with the help of its stakeholders such as pharmacists and key employees.

In 2004, Generika Drugstore opened its doors and started selling medicines to the public through its
first outlet located in Montillano, Muntinlupa. Since then, more customers have patronized Generika
Drugstore and the company continuously expanded by opening more stores.

With 16 company owned stores in 2008, Generika Drugstore took the next big step and made its
business model available for franchising.

In 2011, Generika Drugstore has set its footprints in Visayas and Mindanao. Generika continued to
expand by putting up more branches not only in key cities and municipalities, but also in small towns
and barangays. Franchising became the main engine of growth for Generika in the years ahead as the
company strives to serve more communities throughout the country.

True to its pioneering nature, Generika Drugstore launched in 2014, MEDPadala- an electronic gift
certificate used to purchase medicines. This is in response to the growing need of OFWs abroad who
sends money to the Philippines for their families health needs. MEDPadala ensures that the money
sent will be used for medicines only instead of other unnecessary items.

Another major milestone took place in 2015 when Generika Drugstore became a proud member of
AC Health, a subsidiary of Ayala Corporation. Through AC Health, Ayala acquired 50% stake of
Generika to help address the gap in affordable retail healthcare. With Ayala’s business expertise,
Generika Drugstore is poised to become bigger in the pharmaceutical retail space as it continues to
be at the forefront in providing quality affordable healthcare to Filipino families.

FRANCHISE PACKAGE AND

INVESTMENT

1. How much is the investment cost to put up a Generika Drugstore?

Generika Drugstore’s standard franchise package is approximately P900K – P1.7M and includes:

The franchise fee (P210K)

• Computer hardware (3 or 4 PC package) and OS licenses

• Retail expert, the proprietary POS system of Generika, which helps you manage your sales
transactions, inventories and facilitate customer service and is regularly loaded with new features and
modules

• Design Services Fee

• Security deposit to our commissary (refundable)

• Initial inventory of 300KP to 400KP

• Pharma supplies

• Marketing supplies and sound system

• Operations supplies

• Store Renovation

Furniture / Fixtures

• Business Permits

• Operating Capital

Responsibilities of the franchise applicant, under the guidance of Generika Drugstore

• Hiring of store renovation contractor

• Hiring of Staff

• Securing Business Permits

• The security deposits to the lessor for the rental of the store space

Total Investment for a Generika outlet in a particular location will vary based on the size and
condition of the store, equipment required, prevailing rates for rent, amount of advance rent and
deposit, and the need for working capital and contingencies.

The Franchisee must be cautious during site selection and store preparation in order to minimize the
cost of renovation, other capital expenditures and expenses that would increase the total investment.
Please take note that many items are pro forma estimates, e.g., prices of computers, construction
costs, etc., are subject to change. The costs may also vary from one region to another. Moreover,
figures could move up or down depending on the specific conditions of each location as well as the
wishes of the franchisee, e.g., who might take a much bigger space to accommodate a medical clinic
or office.

2. How much is the franchise fee itself?

The franchise fee, payable to the Franchisor, P210K. It is a one-time payment which is good for the
entire duration of the franchise (5 years).

The Franchisee Fee grants the Franchisee the right to use the Generika Drugstore trademark and to be
taught the Generika Drugstore system. Part of the franchise fee paid is used for market study done by
the

Franchisor to validate the prospect site, and for other research deemed necessary by Generika
Drugstore.

Generally, the franchise fee entitles the Franchisee to a wide array of services: assistance in hiring
and screening of the store personnel, 13-day comprehensive training of your store personnel, store
design assistance and monitoring of your renovation, counselling on the processing of permits, etc.

3. How long is the franchise contract?

The franchise contract is good for five years and can be renewed. For renewal of the franchise
contract, you will be charged 30% of the prevailing franchise fee. This renewal is valid for another
five (5) years.

4. Can I sell my franchise?

You must inform Generika of your intention to sell. Generika will have to evaluate the interested
party and make sure that he/she is qualified to take over the existing franchise.

FRANCHISE LOCATIONS/SITE
ASSESSMENT

1. What areas are open for franchise?

Generika Drugstore is open for franchise nationwide (Luzon, Visayas, Mindanao).

2. Does Generika Drugstore provide franchisees with locations?

In most cases, Generika Drugstore does not, as good sites are difficult to get and are quickly taken.
Generika suggests that you look for a site yourself to be able to get a franchise sooner.

3. What are the franchisee’s responsibilities regarding site assessment?

It is important that you do your own due diligence, conduct your own investigation about the
proposed location, assess its strong points and weak points, and/or explore further possible aspects of
a site. Generika Drugstore focuses on the issues related to a location that it believes are important;
however, if there are other things important to you, or other issues that you're aware of, use this
report as your guide to determine if this location is right for you.

Finally, you, as Franchisee, are responsible for making the decision on the choice of location, and
negotiating the rent and other terms and conditions of the contract. Generika Drugstore’s reports,
comments and recommendations are presented only as an additional reference and help.

4. How long does it take to process the market study and evaluation of a site?

If during the ocular inspection Generika Drugstore feels that the site is not feasible, you will be
immediately informed. If the site shows positive prospects, the market study will take a few days.

After the market study, Generika Drugstore conducts a “deliberation meeting” at its head office,
during which the site is presented and its strong and weak points are discussed. The franchisee or
franchise applicant who will be managing the site – if the franchise application is successful – is
invited to join this meeting so that he or she can give his comments/observations, and also witness
first-hand Generika Drugstore’s reactions to the market study.

5. What is the required store size?

Generika Drugstore requires approximately 20 sqm up to 40 sqm, preferably with at least 3-4 meter
frontage. 20 to 40 sqm is usually ideal and will accommodate the customer area, equipment such as
three sets of computers, refrigerator, compounding area, shelves, counters and cashier tables, as well
as storage for the stocks. Preferably, the sites should also have a restroom, but it is not an absolute
necessity.

6. What are the store models of Generika Drugstore?

Generika Drugstore has 1 store model. The Standard Model. The Standard model is used for
locations where the market population is above 30,000 and the required store floor space is more than
25sqm.

7. What are the location requirements?

Locations should be at the ground floor, located along a main street, preferable at a corner
intersection, and highly visible outside with no major obstruction to access. There should be dense
residential areas nearby, and good pedestrian traffic. Ideal locations are near landmarks, like public
markets/commercial areas, jeepney or tricycle terminals. Presence of nearby hospitals or clinics is an
advantage but it is not required.
8. What qualities do we look for a Franchisee?

A Franchisee must be hands-on, knowledgeable in managing a business, has the capacity to open and
operate multiple branches, and must be financially able to sustain a franchise business.

Why choose Generika Drugstore?

Advanced information system and fully computerized operation.

Our Proprietary Point of Sale (POS) system helps you monitor sales transactions, inventories and manages your
store conveniently.
Emphasis on quality and service
Air-conditioned stores to maintain the potency of medicines with highly trained store personnel.
Wide range of products
Generic medicines, branded medicines and selected consumer goods.
Additional revenue generating sources.
I-Load (Globe, Smart & Sun)
MEDPadala (the first electronic gift check for medicines)
Commendable track record
Multi-awarded drugstore business
Dedicated support of franchisees
Ongoing monitoring and business consultation with franchisor.
Strong sense of social responsibility
Patient counseling, Libreng Konsulta, Mobile Lab services, etc.
The Ayala group has raised its stake in the health care space by gaining majority
control of the Generika group of companies, one of the pioneers in the retail
distribution of generic medicines in the country.

Conglomerate Ayala Corp.’s wholly owned subsidiary Ayala Healthcare Holdings

Inc. (AC Health) has agreed to increase its stake in the Generika group to 52.5 percent
from 50 percent by subscribing to primary shares.

The Ayala group has raised its stake in the health care space by gaining majority
control of the Generika group of companies, one of the pioneers in the retail
distribution of generic medicines in the country.
Conglomerate Ayala Corp.’s wholly owned subsidiary Ayala Healthcare Holdings
Inc. (AC Health) has agreed to increase its stake in the Generika group to 52.5 percent
from 50 percent by subscribing to primary shares.

Generika’s issuance of new shares would in turn “raise additional capital for
operations and national store expansion,” Ayala said in a disclosure to the Philippine
Stock Exchange on Thursday.
The Generika group is composed of Actimed Inc., Erikagen Inc., Novelis Solutions
Inc., and Pharm Gen Ventures Corp. With over 800 stores nationwide, this is the third
largest player in retail pharmacy in the country by number of stores.
The Ayala group has raised its stake in the health care space by gaining majority
control of the Generika group of companies, one of the pioneers in the retail
distribution of generic medicines in the country.
Conglomerate Ayala Corp.’s wholly owned subsidiary Ayala Healthcare Holdings
Inc. (AC Health) has agreed to increase its stake in the Generika group to 52.5 percent
from 50 percent by subscribing to primary shares.
Generika’s issuance of new shares would in turn “raise additional capital for
operations and national store expansion,” Ayala said in a disclosure to the Philippine
Stock Exchange on Thursday.

The Generika group is composed of Actimed Inc., Erikagen Inc., Novelis Solutions
Inc., and Pharm Gen Ventures Corp. With over 800 stores nationwide, this is the third
largest player in retail pharmacy in the country by number of stores.
“The transaction is expected to be value accretive to AC Health,” the disclosure said.
Issuance of shares to AC Health would only be made after the satisfaction of the
conditions precedent, the disclosure said. Approval from the antitrust agency
Philippine Competition Commission (PCC) is among the conditions needed to close
the transaction.
The deal is priced at less than 10 percent of Ayala Corp.’s total equity.