The Indian pharmaceuticals market is the third
largest in terms of volume and 13th largest in terms of value, globally. The
growth in this space will be primarily driven by the high burden of disease, good economic growth leading to higher
disposable income, improvements in healthcare infrastructure & improved
healthcare financing, to name a few. India is expected to be among the top
three pharmaceutical markets by incremental growth and the sixth largest market
globally in absolute size by the end of 2020.
On the other hand, India
E-Pharmacy market is at its nascent stage, but like other
categories, it has the potential to be a very large industry segment in the
near future. The advent of online pharmacy retailers in the Indian market
during Covid period will further increase the penetration of the organized
pharmacy segment in the country. Most e-pharmacies have seen a surge in demand,
thanks to customers beginning to recognise them as a safer, faster, and cheaper
mode than physical stores. It is
expected that the E-Pharmacy model could account for 15%-20% of the total
pharma sales in India over next 10 years, largely by enhancing adherence and
access to medicines for a majority of the under-served population. Currently,
many E-Pharmacy players such as Medlife, Netmeds, 1MG and Pharmeasy operate in
this segment and offer varied value added services to the consumers. Though, the
market competition is majorly concentrated among these major players, but we
have witnessed the entry of many new entrants into this market in recent months
owing to its rising popularity of the segment in the retail pharmaceutical
industry.
Challenges for Retail Pharmacy Market in India
Low Industry
Margins: Retail pharmacy
is a highly fragmented and competitive industry with ~800,000 registered retail
outlets across the country. Drugs are bought in smaller quantities by these
retail stores from drug distributors at high prices which in turn reduces their
profit margins.
Sustainability of
the Industry: Due
to increased competition and rising pressure on price controls, the
sustainability of the retail pharmacy industry is at risk due to the already
lower profit margins. Technology adoption can help this industry to increase
productivity and provide value-added services to consumers.
Drug Abuse: Allegations of medicine sales without
prescriptions are levied at some of the retail pharmacies. This has led to
significant number of cases of drug abuse in the country.
Counterfeit
Medicines: Retail
pharmacies in India are alleged to sell sub-standard and fake medicines,
thereby increasing the risk of adverse effects.
Tracking &
Documentation: Sale
of drugs also happens without providing bill / invoice for the purchase,
affecting the amount of tax collected. Poor documentation of prescription drug
sales is therefore impacting the drug recall process and poor inventory management.
Competition Overview
The competition in E-Pharmacy space of India has consolidated
in last 2-3 years. The industry majors such as Medlife, Netmeds, Pharmeasy
& 1 MG are seeing surge in their number of orders each month and are
looking forward to expand their distribution reach further to Tier 2 &
Tier-3 cities and rural regions as well.
Medlife and Pharmeasy have the widest reach amongst all the
e-pharmacy players, delivering medicines to approx 25,000+ pin codes across the
country. Netmeds supplies drugs to all major cities in India with presence in
approx 19,000+ pin codes as of FY’2020.
The major parameters of competition are the
product portfolio of companies along with various value added services &
discount option offered by various players. The e-pharmacy players in India are undertaking various activities for
marketing in order to gain competitive advantage and to increase customer
retention. Therefore, players are allocating high portion of their total expenses
to marketing activities. Advertising is mainly done through digital media
platforms such as Whatsapp, Facebook, Instagram and other social media
platforms. Many players are also offering discounts in the range of 15-70% to
attract more and more consumers on their platforms.
Future Growth
Online
pharmacies account for 1.5-3% of the total pharmacy sales in India. The country
has over 502 million smartphone users and 653 million mobile broadband
subscribers and it is expected this will further augment the penetration of
these platforms in the coming years specifically among young consumers. Going
forward, players might develop their hybrid models and could partner further
with offline pharmacies and pharmaceutical manufacturers to avail the benefits
of both the worlds- offline and online and will be able to expand their product
portfolio to other segments as well to increase their revenue generation
capability and to offer a one stop solution to every healthcare needs of the
consumers.
The
report would be beneficial for various stakeholders who are interested to
understand the overall ecosystem, competition framework & challenges faced
by the major E-Pharmacy companies in India.
Key Target Audience:-
Pharma/Medicine Manufacturers
Medicine Distributors/Wholesalers
Health Supplements and OTC Products Manufacturers
3PL Logistic Players
Government Organization catering to the Pharmaceutical
Industry
E-Pharmacy Players
Offline Pharmacy Players
Hospitals
Industry Associations
Time Period Captured in the Report:-
FY’2015-FY’2020
Companies Mentioned:-
Medlife Wellness Retail Private Limited
Netmeds Marketplace Limited
Pharmeasy (91 Street media Technologies Private Limited)
1 MG Technologies Private Limited
Key Topics Covered in the Report:-
Operating
Analysis of Medlife, Netmeds, Pharmeasy, 1 MG (Including GMV, Number of Orders
(Per day), Average Ticket Size, Month-on-Month growth Rate (On the basis of GMV),
Cancellation Rate, Refund
Policy,
Logistic Charges, Number of Warehouses ,
Number of Application Downloads (As of 31st May, 2020) (Monthly Average), Partnerships,
Unique Selling Proposition, Business Strategies, Strength, Weakness)
Financial
Analysis of Medlife, Netmeds, Pharmeasy, 1 MG (Including Total Revenue, Growth
of Revenue (%), Total Expenses, Earnings before Tax & Extraordinary Items,
Earnings after Tax (Net Income), Growth of Net Income (%), EPS,
Advertisement Expenses)
Heat
Map Analysis of Value Added Services (Including Online Consultation, Diagnostic
Labs, Appointments with Doctors, Health Blog)
Services
Analysis of Players (Including Delivery Timings, Refund Status, Express
delivery, Subscription model, Private Label Goods, Diagnostics Services, Live
Doctor Consultation, SKU Details (Top Categories), Payment Services
Competition
Analysis (Market Share on the basis of GMV)
For More Information on
research report, refer to below link:-
Related Reports:-
Contact Us:-
Ken Research
Ankur Gupta, Head Marketing & Communications
+91-9015378249
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