Case Study

Ayala Healthcare Holdings, Inc. (AC Health)

December 31, 2022
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Can the largest and oldest corporation in the Philippines contribute to long-term social benefit? That question is at the heart of the story of Ayala Healthcare Holdings, Inc., also known as AC Health. Founded in 2015, AC Health is dedicated to bringing affordable, high-quality medical services and pharmaceuticals to a country that historically has not had these widely available.
Ayala Corporation, the parent organization that launched AC Health, is a much larger conglomerate, still controlled primarily by the same family that founded it in 1834. During the past decade, parent and startup have both defined their core purpose as making life better for all Filipinos. They’ve demonstrated the multifaceted effort and design needed to realize that deeper purpose while also meeting sustainable growth targets.

AC Health has grown its care network and patient base throughout the years, largely through its innovative business model. The company has developed an entire healthcare ecosystem aimed at the country’s emerging middle-class population. Its several lines of business, primarily broken down into three major pillars (clinics and hospitals, pharma, and digital health), all add to one another’s value.

The Healthway Group includes Healthway, one of the major clinic networks in the country. It is complemented by QualiMed, a comprehensive network of four full-service hospitals and one standalone day surgery center. On pharma, AC Health has Generika, its chain of drugstores consisting of over 700 branches nationwide, which promotes and sells affordable high-quality generic medicines. The pharma pillar also includes IE Medica and MedEthix, major pharmaceutical importation and distribution firms. This allows AC Health to vertically integrate its pharma supply chain and further expand its medicine portfolio. Finally, on digital health, AC Health, in partnership with 917Ventures, has the new KonsultaMD superapp—a consolidation of AC Health’s HealthNow and AIDE apps, and 917Ventures’ KonsultaMD app. The new KonsultaMD will allow teleconsultations, medicine deliveries, and home-based diagnostic services, among others, to be accessed all through one smartphone app.

These services complement each other in ways that make each of them more effective than they would be on their own. They are particularly meaningful in the Philippines because of the country’s longstanding struggles with healthcare coverage. The country faces high rates of infectious diseases, its maternal and neonatal mortality rates still need to come down, and it is also prone to natural disasters that put additional pressure on the health system. Health insurance coverage has been so limited and its resources so meager that, as of 2019, many Filipinos seldomly see a doctor.

AC Health’s parent company, Ayala Corporation, which includes real estate, banking, telecommunications, water, energy, transport infrastructure, electronics, automotive, and education businesses, is also known for its commitment to social and environmental responsibility. One telling indicator is the Glassdoor website of anonymous workplace ratings, where 99 percent of the company’s employees say they approve of the CEO. Chairman of the Board Jaime Augusto Zobel de Ayala is a leading exponent of stakeholder capitalism. “[The Ayala Group] used to focus on the affluent end of the market,” he told McKinsey Quarterly in 2020, “but I wanted to leave a legacy of an institution that addressed the needs of the vast majority of Filipinos.”

In January 2022, IFC invested in Ayala’s $100 million social bond issuance. These are thematic bonds: capital-raising instruments oriented to specific investment “themes” such as climate change, food,health, or education. They also align with agreed-upon transparency and disclosure guidelines, a feature that attracts investors who want assurance that their financing efforts will genuinely support positive social and environmental outcomes.

The 2022 social bond will finance the first dedicated specialty cancer hospital in the Philippines, which AC Health is building and will operate in partnership with Siemens, Varian, and Cancer Treatment Services International (CTSI). IFC’s investment, combined with its advisory support, will be a landmark transaction, applying Excellence in Design for Greater Efficiencies (EDGE), IFC’s green building certification system. In meeting the EDGE-designated efficiencies for the use of energy, water, and materials, the cancer center will be good for the sector. Meanwhile, the company’s pandemic-driven transition to digital first technology with a very human-centered sensibility continues to gain strength. The government, in turn, is launching initiatives to expand health insurance coverage and service access to more Filipinos than has ever been done before. When it comes to providing healthcare as a service, AC Health is at a turning point, and so is its country.


I. Creating shared value

II. Developing an integrated ecosystem

III. Innovating on new business models and services

IV. Designing digital technology for people

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