Following IPO, Brazilian Medical Education Network Afya Eyes Consolidation

July 19, 2019

By Rebecca Heilweil

On Friday, the Brazilian company Afya went public on the Nasdaq, with the hope of raising money to integrate more products and new schools into its growing medical education network.

The company, trading under the ticker symbol "AFYA", appears to be on its way. By mid-afternoon, share prices were up nearly 20 percent.

Afya offers an integrated curriculum of personalized online and interactive content that's integrated with in-classroom studies offered by the schools it operates. Afya's service is meant to follow medical students throughout their studies, from undergraduate studies to their residency prep courses.

"We have many opportunities for consolidation. We are aiming to consolidate more medical institutions in Brazil," CEO Virgilio Gibbon told Cheddar on Friday.

He explained that Afya hopes to address the high demand for doctors in Brazil, which faces an ongoing shortage of physicians, especially in the country's most underserved regions.

In the company's SEC filing, Afya reported that "[o]n average, Brazilian cities with less than 50,000 inhabitants, which corresponds to approximately 90% of all cities in Brazil, have less than 1 physician per 1,000 residents," adding that the country is expected to have 3.07 physicians for every 1,000 people by 2028.

"We need [many] more doctors there. And in Brazil, the density between physicians and inhabitant is very low, so we have almost 100 percent of employability," explained Gibbon. "Also, there are very decent salaries, that makes these careers very attractive for Brazilians. It's also very important for social impact."

Last year, Techcrunch reported that the country ⁠— the world's seventh-largest healthcare market ⁠— now has more than 250 startups working in the healthcare sector.

"It's a huge market in Brazil, very spread out from north to south in our country. As the first step after getting these new institutions in our portfolio, we [will] roll out our digital platform, enhancing the curriculum, their learning program, and engineering much more value for these future physicians at the market," explained Gibbon.

Afya was formed from NRE Educacional Colleges, which had operated several healthcare schools in Brazil, and Medcel, a Brazilian educational technology firm that focused on distance learning.

The company now says it serves 16 campuses, and that it maintains more than 50 partnerships with various hospitals throughout the country.