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The Online Pharmacy Market in India medbuzz.in/blogs/the-online-pharmacy-market-in-india Just like you order your clothes, electronics or other stuff of personal use through different websites, the pharmacy market has also started operating the same way through the internet. While there are restrictions on what kind of advertising can be done or medicines can be kept, the online pharmacies have been becoming a hit nevertheless. India comes in third place for the pharmaceutical industry in terms of volume, and in terms of value, it takes the thirteenth place globally. No surprises here given how the country has been known to be the favored destination for medical tourism. With its skilled resources and affordable healthcare, millions of dollars flow into the economy thanks to the healthcare sector. With the advent of internet and availability of doctors on call, this facility and affordability has been further extended to the not so affluent sections of the Indian population too. Size of the Pharmacy Market: A Few Stats The online pharmacy presents a total market size of US$9.3 billion for the year 2019 and estimated to reach a market size of US$18.1 billion by 2023. The Indian pharmacy market takes 35 per cent of chronic medicines and the rest 65 per cent as acute medicines. The rise in the online pharmacy market has mainly been through collaboration with the local pharmacies. The retails pharma market is at a promising stage divided into three segments: generic drugs, OTC or over-the-counter, and patented products. The generic drug constitutes the largest share of 70 per cent market share of the revenue. OTC medicines and 1/5
patented drugs form 21 per cent and 9 per cent shares respectively of the total market share. The Indian pharmacy retail market was valued at around US$ 17.64 million as of 2017. The driven points were the anti-infective market, the cardiac drug market and the gastrointestinal drugs with their shares as 15.2 per cent, 12.5 per cent and 11.8 per cent, respectively. The vitamins, nutrients market and the anti-diabetic market holds 8.8 per cent and 8.1 per cent shares, respectively. In India, the online pharmacies that have been able to deliver medicines at homes without people visiting the brick and mortar ones are mainly Medlife, Netmeds, 1MG, PharmEasy, Myra, CareOnGo and PharmaSafe. Whooping a market share of the total online pharmacy market in India, Medlife is already a leader with 30 per cent. However, all of these players have been based on the standard prescription-based medicine model whereby no generics are provided. At Medbuzz, we hope to start a revolution by making the affordable and available to the masses so that you they buy generic medicine online. And as we strengthen the cause of Digital India by taking the pharmacy online, we also make sure that through the use of generic medicine app, the same become reachable to all. Having said that, let us have a look at some of the important reasons for the growth of Online Pharmacy Market in India. Factors for the growth of Online Pharmacy Market in India 1. Internet The total internet subscribers from the year 2015 to 2020 has been increasing at a CAGR of 15 to 16 per cent, and the main factor is the mobile internet. With the improved broadband services under the 'Digital India Program', the number is expected to rise more. Smartphone mobile users with digital transaction usage are expected to grow to 600 million in the coming years too. 2. Digital India The vision to transform the country into a digitally empowered one and to make the citizens aware of the services that can be made available by the powerful internet connectivity has helped in improving the overall infrastructure significantly. The main objective is to connect with every corner of the country, including each village and smaller areas. For farmers and remote villagers, the Government of India programs to ensure high-speed internet to improve the lives of its citizen. 3. Online healthcare initiative by the Government The Ministry of Health and Family Welfare, with their various initiatives is using Information and Communication Technologies (ICT) to improve the health of its 2/5
citizen. The National Health Portal is an online portal that provided information to citizens and stakeholders in a variety of languages to create awareness about health programs and services. Online Registration System is a generic software for hospitals in the government sector which covers major functional areas like patient care, medical records management. Sugam is a single-window for multiple stakeholders that helps in the submission of applications online, their tracking, processing and finally grant of approvals online mainly for drugs, clinical trials, ethics committees, medical devices and vaccines. All the above government initiatives will bring medical services online and help people get familiar using the e-healthcare. 4. Growth of Healthcare Insurance The share of health insurance has doubled in the last five years, and the major drivers of the same increase in the awareness and adopting of insurance products, and rising programs of insurance schemes by the Government. 5. Ayushman Bharat Health Insurance Scheme National Health Protection Scheme or Ayushman Bharat Yojana, aims for a healthy, capable, and content, new India. The scheme is mainly for the poor, deprived rural ones, as well as for the fifty crore people who will be having a benefit cover of five lakhs Indian rupees' scheme per family. 6. Changing Disease Patterns In India, the pattern of diseases has shifted from communicable to non-communicable diseases. Due to changing lifestyle, diabetes and hypertension are rising, and the rise in chronic diseases has led to increased demand for medicines to be taken over the long term. The online pharmacy provides cost benefits as they supply medication at a cheaper cost, and they cut down their extra margins too, which in turn offers a great discount for the consumers. Other factors such as Foreign Direct Investment Policy (FDI), Single Window Approval, increased spending on medicines, growth in healthcare financing products, increase in the Indian economy and domestic demand are among other things that have influenced the factors of online pharmacy market in India. Challenges for the Online Pharmacy Market in India 3/5
The online pharmacy operates as per the Drugs, and Cosmetics Act, 1940 (D&C Act), Drugs and Cosmetics Rules, 1945 (D&C Rule); Pharmacy Act, 1948; and Information Technology Act, 2000 (IT Act) and there are no specific regulations that govern the online pharmacy market in India. Here is a list of the different rules and regulations between the existing and the proposed one with the legal issues: License- Existing Regulation says retailers must obtain a license for the sale of medicines as per D&C Act and D&C Rule. The proposed rule says to create a National Portal for transacting and monitoring the online sale of drugs. Storage and Transportation- Existing Regulations say the license is grated if pharmacists' premises are adequately quipped for storage of medicines sold are to be given by hand to a patient as per D&C rules. The proposed rule says that online pharmacy is an intermediary, its registration, functions, responsibilities need to be fixed under D&A Act. Prescription- As per the existing regulations, a valid prescription is mandatory for the sale of drugs as per D&C Act. The proposed rule says that the sale of online medicines is to be carried through the proposed Electronic Prescription Exchange. Geographical Restriction- The existing regulations say that geographical restrictions at the licensed premises by D&C rule. The proposed rule says that the sale of medicines within the respective state from where the order has been placed, and this should not be interstate. Patient Confidentiality- Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations, 2002 and Pharmacy Practice Regulations, 2015 makes strong provisions for patient confidentiality, as per the existing regulations. In 2018, December, the Delhi High Court ordered a complete ban on the online pharmacies across India, as over 8 lakh traditional chemists opposed on the ground that the online selling of drugs can lead to the illegal and easy availability of drugs. But, the Madras High Court, on the appeal of a group of online pharmacy companies banned the suspension till a decision is announced. 4/5
Online pharmacy companies do not compete with the traditional pharmacies, and they do offer heavy discounts to consumers to gain market share. Conclusion Though adoption and discounts are important for the online pharmacy market, profit cannot be achieved by operational efficiency and lowering of delivery costs; cuts have to come down to a reasonable rate for breakeven and actual profits The online pharmacy market can even widen their revenue-generating opportunities, like the collection of samples, e-Prescriptions and health insurance services that can help in engagement with the customers and broaden their services too. There are challenges like trust issues, language barrier, customer support issues, data privacy that needs to be addressed by the online pharmacy companies. Some consumers even face difficulties like placing the order, cancelling, replacement with substitutes and lack of customer support. There are benefits of online pharmacy like increased convenience, improved accessibility, cost advantage, enhanced patient compliance and education, and authenticity. Finally, we will conclude with a statement: “As one of the main lists of the Government has been to provide easy, quality and affordable access to health services to the consumers. I'm sure that the evolving concept of ePharmacy will give an impetus to the health sector of the country- "Dr A. Didar Singh Former Secretary-General FICCI. 5/5
