E-pharmacy is also known as internet pharmacy, online pharmacy or mail-order pharmacy. E-pharmacy companies operates online and deliver their products to its customers through shipping chains. E-pharmacy platform provides all types of pharmaceutical drugs such as OTC drugs, prescription products, and personal care products to its customers. Customers only have to upload their prescriptions online for getting prescription drugs. However, sales of illegal drugs is a major problem in online pharmacies. However, governments and regulatory bodies are working on reducing it by making various rules and regulations. For instance, the U.S. food and Drug Administration (FDA) has prohibited the import of drugs in the U.S., and E-pharmacy companies who want to sell its products in the U.S. need to have their physical presence in the country. Furthermore, the company has to take state wise license to sell and deliver its products in respective state.
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Increasing investment and funding in key region such as Asia Pacific and Europe to scale up and expand their online pharmacy business and this is expected to drive growth of the global E-pharmacy market in the near future. For instance, in 2017, Zur Rose AG, a Switzerland-based online pharmacy company raised US$ 237 million to expand its business in Germany. Furthermore, the increasing usage of internet is also expected to drive the growth of market. For instance, according to data published by the World Bank around 87.5% of total population of U.K. were using internet in 2012, which has increased to 94.8% in 2016. Strategies deployed by major E-pharmacy key players such as free delivery, and lucrative offers and discounts is also expected to increase the adoption of E-pharmacy by population. For instance, in April 2018, Netmeds, an India-based E-pharmacy startup, is providing 20% discounts offers on its medicines. Moreover, these kinds of discount are widely aiding in growth of the market. Increasing prevalence of lifestyle diseases such as high blood pressure, diabetes, cardiovascular diseases, and obesity etc. is also expected to increase demand from products from E-pharmacy. For instance, according to data published by World Health Organization (WHO), globally, the number of people with diabetes increased from 108 million in 1980 to 422 million in 2014. According to WHO in 2017, cardiovascular diseases is the leading cause of death worldwide, about 17.7 million died from cardiovascular diseases in 2015.
Increasing investment by private players and initiatives taken by governments is expected to drive growth of the global e-pharmacy market
Key players in the market are majorly investing to scale-up online pharmacy business, which is projected to drive growth of the global e-pharmacy market in the near future. For instance, in 2017, Zur Rose AG, a Switzerland-based online pharmacy company, invested US$ 237 million to expand its business in Germany. Furthermore, initiatives taken by government to establish well developed online infrastructure and provide high speed internet connection is driving growth of the market. For instance, in 2015, Indian government launched Digital India program with the motto ‘Power to Empower’. Under this program, government aims to digitalize India by providing high-speed internet networks in rural areas. Such initiatives by Indian government is expected to positively affect the E-pharmacy market over the forecast period.
Increasing penetration of online pharmacy due to lucrative strategies deployed by key players
Offers and discounts on E-pharmacy channel is a major factor attracting consumers towards it. For instance, as on April 2018, 1mg, an E-pharmacy company in India, is providing a discount of 12% on over-the-counter (OTC) drugs. Free home delivery, and free returns are other two important and attractive features of E-pharmacy channel. Thus, evolution of E-pharmacy channel has resulted in availability of products at every doorstep and also, at significantly lower price. Moreover, increasing internet penetration across the globe has expanded the customer base for these E-Pharmacy companies. For instance, according to data published by World Bank, only 12.58% of total population were using internet in 2012 in India, which has increased to 29.5% in 2016. The growth rate of internet coverage is similar in developing economies such as China, Brazil, and Mexico.
Selling of illegal drugs online is a major concern for regulatory bodies across the globe. Hence, various governments are working on formulating policies to regulate the E-pharmacy business. In U.S., Food and Drug Administration (FDA) has ruled that importing prescription drugs is illegal. All the online pharmacies that are supplying medication in the U.S. must be physically present in the U.S. Furthermore, all the online pharmacy companies need to be licensed at the state-level. However, it does not need require physical presence in state, it just needs to get licensed if it wants to deliver its products in a particular state. The Central Drugs Standard Control Organization (CDSCO), the regulator for pharmaceuticals and medical devices in India, and the health ministry are also working on framing some policies to encouraged online pharmacy companies to sell quality medicines.
E-pharmacy companies have gained significant market share in urban, however, these companies have not been able to effectively target rural areas. Low literacy rate, lack of internet facilities, weak supply channel, and lack of awareness about these channels are the prime reasons for this scenario. Moreover, rural population still accounts for significant share in total population. According to the World Bank data, about 2 in 3 people in India, and 2 in 5 in China lives in rural area in 2016. High percentage of population living in rural areas with low or no access to online pharmacy has inhibited the growth of E-pharmacy market.
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Key players operating in the E-Pharmacy Market includes The Kroger Co., The Walgreen Company, Express Scripts Holding Company, CVS Health, Zur Rose Group AG, Giant Eagle, Inc., Walmart Stores, Inc., OptumRx Inc., 1mg, and Netmeds.
This post was originally published on Trading Herald