E-commerce success: After mobile phones, clothes, now online medicine market to grow multifold.
Indian e-pharma players will be the next beneficiaries of e-commerce popularity as they are poised to grow multifold over the next few years to attain a market size of $2.7 billion by 2023, says a report. Currently pegged at $360 million, the industry is rising at a CAGR of above 18%. The factors driving e-pharma business are smartphone ownership and the increasing internet access across India, a report by EY said. Several other reasons have also contributed to this. While there has been a rise in chronic diseases, per capita income levels have also spiked. Also, the ease of ordering online has made e-commerce platforms popular. The same worked in favour of medication business as well.
“On the back of the renewed focus of the government and households on healthcare spending and the faster adoption of internet amongst users,” the pharmacy market is expected to grow, said Ankur Pahwa, Partner and National Leader – E-Commerce and Consumer Internet, EY India. He added that this will also create a host of B2B opportunities.
E-pharma eyes majority share in chronic medicine market
The Indian pharmaceutical market caters to two market needs — Chronic and Acute. The domestic pharma is led by the demand for acute medicines as over 60% of the medicines are needed for acute diseases. However, the e-pharmas are looking a majority share of 85% of the total domestic chronic market. They are also targeting a 40% share in the acute medicine market as well, the report said. 2023. “This expected rise in the acute target market by e-pharmacies, can be attributed to an improvement in last mile logistics through collaboration with local pharmacies and integrating into existing hyperlocal models,” according to the EY analysis.
It is not all rosy for e-pharma players. Considering the fact that the online platforms provide more discounts than their retail store counterparts, the cash burn is common in the e-business.
Other issues such as the fear of receiving counterfeit medicines, customer support laggards, lack of regional languages in the mobile application are major obstacles that the e-pharmas will need to work on to improve their penetration.