Lack of progressive and proactive e-pharmacy regulatory framework is impacting the overall growth potential and future investments in the Indian e-pharmacy sector, says GlobalData, a leading data and analytics company.
In a bid to prohibit the unauthorized sale of medicines by certain e-pharmacies, the Drug Controller General of India (DCGI) ordered all states and union territories in December 2019 to stop the online sale of drugs by e-pharmacies without a valid license.
GlobalData’s report, ‘CountryFocus: Healthcare, Regulatory and Reimbursement Landscape – India’, reveals that the pharmaceutical market in India is expected to grow at a compound annual growth rate (CAGR) of 5.6% to reach US$38.3bn in 2022.
Venkat Kartheek Vale, Pharma Analyst at GlobalData, comments: “The e-pharmacy sector in India has a huge growth potential considering key factors such as growing use of mobile internet in urban and rural areas, increasing access to private and government-backed health insurance schemes, and high incidence of lifestyle-related diseases that require regular use of medicines over a long period.”
The e-pharmacy business operates in two models – inventory-based and marketplace-based – both of which require prescriptions uploaded to the e-commerce platform to be verified by registered pharmacists before delivering the medicines to the customers.
Key players in the sector include Medlife, NetMeds, PharmEasy, 1 MG, MedPlus Mart and Apollo Pharmacy, among which Medlife is the leading player with 30% market share.
The e-pharmacy business offers a serious competition to offline retail pharmacies through heavy discounts on products, convenient home delivery options, marketing campaigns, and extended services such as booking diagnostic tests and doctor appointments.
The competitive landscape may increase in intensity with the possibility of many offline retail pharmacies launching their e-commerce portals. In addition, major e-commerce players such as Amazon and Flipkart can also enter this space as they are very keen to capture a major share of the e-commerce industry in India.
Vale concludes: “E-pharmacy sector can still be considered in the nascent stage and a business-friendly environment can improve the confidence of the existing and future investors. Successful adoption of new regulations by the e-pharmacy sector coupled with value-added services like reminders for medication intake, prescription fill and diagnostic tests, and wellness programs for patients will enhance the likelihood of higher market penetration leading to faster growth.”