Clinicas del Azucar

Clinicas del Azucar is working to solve the issue of providing quality and affordable diabetes care for low-income populations. In 2019, the International Diabetes Federation estimated that 463 million people have diabetes and this number has more than tripled during the last 20 years. In Mexico over 12.8 million people have diabetes (15% of the population). It is the number two cause of death in the country with at least 100,000 people dying due to diabetes, but this does not include the blindness, amputations, and suicides caused by the disease. Important factors impacting these statistics relate to diabetes management. Only 5% of the population successfully manages their diabetes. 40% of people have received no education in regard to diabetes, which leads to complications. Lastly, 56% of the affected are currently managing their diabetes very poorly. The current healthcare infrastructure in Mexico poorly handles the issue. The public sector is unable to properly care for those with chronic diseases and those patients pay out-of-pocket for their medications. Additionally, only 10% of the population has private insurance and can properly manage their diabetes. As a result, most of the population is currently unable to receive quality diabetes care in the country.

Clinicas del Azucar provides an innovative business model approach that provides care to those in need at an affordable and convenient price. The business has four unique qualities that make it capable of providing this service. First, the project operates one-stop-shop clinics with hybrid care (remote or in-person care) that offer patients a doctor, nutritionist, psychologist, lab tests, eye, foot, and kidney diagnoses, a pharmacy, and a retail store under one roof. The firm offers a subscription model that has an annual fixed-fee membership to increase the patient’s convenience while also reducing the patient’s cost significantly. With behavioral science and artificial intelligence, the company helps patients achieve standardized medical outcomes. The organization captures a high volume of data from the patient in order to personalize and optimize their treatment through the principles of evidence-based medicine. As a result, Clinicas del Azucar is able to provide patients with affordable, specialized, and convenient diabetes care. The firm currently has 33 clinics in Mexico and it is rapidly expanding. Clinicas del Azucar is now the largest private provider of specialized diabetes care in Mexico.

Although, no one is immune to diabetes, the reality is that low-income people are hit the hardest. Clinicas del Azucar has served more than 220,000 diabetes patients as of the end of the first quarter of 2022. Patients come from varied socio-economics groups with different levels of household incomes from different states. 20.5% of patients come from the Middle Income group (households in this group make between $2,200 - $1,980 per month), 32.1% come from the Middle/Low Income group (households in this group make between $1,700 - $1,300 per month), and 44.3% come from the Low Income group (households in this group make between $800 and less than $170 per month). The organization engages and understands their patients in order to address their needs. Patients wait in public health institutions for three hours to then be treated by a doctor that may not be fully knowledgeable about the disease and this does not take into account travel time and lost income. As a result, the clinics are located in retail locations in the patients’ communities and one-stop-shop concept allows for patients to get seven consultations in one visit.

I started Clinicas del Azucar because of how difficult it was for my mom to get diabetes treatment without any hassle and for it to be affordable. Me and my team have all similar stories with a close family member having diabetes. It is something that we are passionate about and also something that we want to make sure that every individual, regardless of their socioeconomic level, can have access to diabetes care. Me and my team have been together for more than 8 years working on Clinicas del Azucar and making sure we scale as quickly as we can while still maintaining quality of care.

At the age of 17, I spent a year in the indigenous community of the Sierra Tarahumara. Living in such dire poverty without the most basic sanitary services, my life perspective changed. I witnessed several community members die from a lack of basic healthcare. This experience helped me plant the first seeds of my later social ventures and guided me toward solving social health issues. This experience marked me as a human being and as a leader as my passion has always been how technology can help in healthcare. I learned first hand how a simple diagnosis with help of technology can really change the lives of people living in rural conditions where no hospitals are nearby. 

We know that our solution has huge impact on people with diabetes, specially those who are underserved or traditionally left behind. We want to quickly scale the solution in Mexico to reach all the patients who are in need. But just as in Mexico, there are other parts of Latin America and also in the Latino population in the USA who are also underserved or do not have an alternative to get diabetes treatment. We want this Challenge to help us plan our scaling process to make sure we maintain our quality and our services not only as we scale in Mexico, but also as we scale internationally. 

With the help of this Challenge we will also increase the access to other financial resources that we currently do not have. 

Clinicas del Azucar’s work is unique as it manages to reduce incongruities in traditional diabetes care through the one-stop-shop model while using new technology and additional process steps to further improve the client’s experience and medical outcomes. The clinics are located in retail locations with significant foot and vehicle traffic to make it more convenient for patients. The organization manages to conduct 7 consultations (laboratory, feet check, eyes checks, doctor, nutritionist, psychologist, and diabetes educator) in one visit while offering an affordable unlimited-use annual membership both in-person and digitally through a video consultation or phone call. The way the workflow of services is organized allows for a patient to complete a comprehensive visit in 90 minutes. This is a reduction in time for patients of about 80%. This reduction in time comes in part from new diagnostic tools to expediate the results of testing during the visit. This allows for clients to know exactly how they are doing without the need for a follow-up visit. We have developed “The Diabetes Nudge Lab” in order to develop and test interventions for patients. We collect over 2,000 variables per patients over the year and this allows for the patients to be segmented into different groups. Behavioral science-based nudges and machine learning are then applied to specific groups of patients in order to make continuous improvements to the organization’s approach and increase the likelihood of better medical outcomes. We managed to reorganize the traditional diabetes care process by emphasizing the value to the patient in the process.

Within the next year Clinicas del Azucar’s goals are to scale to more clinics and more online memberships. In order to treat more patients in Mexico, more clinics need to be opened. These clinics will be opened in different states, cities, towns, and neighborhoods in order to reach new patients while locating the clinics in areas that are accessible to them. At the same time, we plan to continue to scale our digital initiatives  in order to reach patients in low-income and low-population density areas. We plan to open 20 more clinics in the next year and continue to reach more patients in our digital initiatives.

Clinicas del Azucar’s five-year goals is to reach 100 clinics in Mexico, continue improving the digital initiatives, and also enter the south of the US to reach the Latin American communities in the south of Texas. Once we have grown large enough in Mexico, we will expand into other Latin American countries.

We measure three main impact KPIs

1. Number of total patients that have received some kind of treatment or diagnostic evaluation
2. % of patients that after 6 months of treatment have an HbA1c below 7.5% (This KPI is a medical outcome to see if the patient is in diabetes control)
3. Number of complications prevented 

We have more impact KPIs that we measure, but these 3 are the most important. We have been measuring all these KPIs since 2016 every quarter.

Clinicas del Azucar’s theory of change involves aligning all of the clinics activities to allow for diabetic patients to lower their blood sugar levels in order for them to live better lives. The organization’s main service is the comprehensive care provided to patients inside the clinic. It also provides this service at an affordable price and at a location convenient to the patient. Once’s the patient receives care and education regarding diabetes their blood sugar drops. Early results from an ongoing 3 year Eli Lilly and MIT study led by Economics professor Jonathan Gruber on the firm’s care reveal that in the first six months of care patient’s HbA1c sugar levels drop by 1.8%. The New England Journal of Medicine reveals that a 1% drop in HbA1c is linked to a nearly 30% reduction in long-term complications of diabetes. As of the end of 2021, the firm’s internal data shows that 64% of patients have an HbA1c sugar levels of below 7.5%. These results are very good as only 25% of diabetics in Mexico have the disease under control, while in the United States and other developed countries the rate is at about 60% according to the International Finance Corporation. If diabetes is not under a patient’s control, then the risk of developing complications is 60% but if it is, then the risk falls to 4%. The short-term outcome of this medical output is a better quality of life for patients as they are able to be healthier and have a better diet than before. In the medium-term, their risk of developing complications drops from 60% to 4%, In the long-term, patients are able to save more money as the cost of managing their disease is lower than it used to be and medical complications are avoided which allows for patients to be active contributing members of society. At the same time, the medical output allows them to have a higher life expectancy.

The model manages to reduce the patient’s costs while adapting care to the conditions of the Mexican people. The average yearly cost of diabetes treatment is around US$1,000 and the organization manages to reduce this cost to $300 per year through an unlimited use subscription-based model. This is achieved by locating clinics in retail locations in the patient’s community. The clinic operates under a “one-stop-shop” model which provides patients with a doctor, nutritionist, psychologist, lab tests, eye, foot, and kidney diagnoses, a pharmacy, and a retail store under one roof. The organized workflow of services and proprietary software allows for patients to receive 7 consultations (laboratory, feet check, eye checks, doctor, nutritionist, psychologist, and diabetes educator) in 90 minutes, a reduction in time for patients of about 80%. After their appointment, patients can purchase their medication from the pharmacy and specialty diabetic products such as sugar-free snacks, shoes, and creams. The organization also captures a high volume of data from the patient in order to categorize the patient into a behavioral archetype. Then the patient’s treatment is personalized and optimized through the principles of evidence-based medicine. The results and data from the interventions are collected and this allows for continuous improvement to occur to refine treatment approaches for the patients. Patients want these services because there are no comparable alternatives in the market. Patients are better able to manage their diabetes while spending less money and time to get these results.

In order to reach financial sustainability Clinicas del Azucar needs achieve the right economies of scale. Currently the firm is able to fund the clinics and care provided through a combination of revenue from memberships and retail sales, grants, equity, and debt. The revenue generated by the clinics is able to fully cover all operating expenses and 100% of SG&A expenses. In order to be self-sustainable, the firm needs to continue to scale to reach the point that revenues fully cover growth expenses. However, in order to continue to create new clinics a mix of revenue and investment capital will be needed. Eventually, the firm will reach a point that revenues can fully fund new clinics at the firm’s targeted expansion rate.

The organization expects to make +$16 million in revenue from membership (70%) and retail sales from the store and pharmacy (30%). The organization has raised $9 million in equity from angel investors, Halloran Philanthropies, Serious Change, Promotora Social Mexico, The Social Entrepreneurs Fund, and the International Finance Corporation. Additionally, the business has raised $1.8 million in debt from Promotora Social Mexico, Global Partnerships, and the Interamerican Development Bank. Lastly, the firm has raised $1.1 million in grants from the INADEM, the Linked Foundation, The Pfizer Foundation, the Social Impact Incentive and Swiss Agency for Development and Cooperation, and The American Express Foundation.