As per the CLSA report, many e-pharmacies are there, operating at present. However, Medlife, Netmeds, Pharmeasy, and others are currently leading in the market as key players. These online pharmacies have exponentially increased their revenue upto $400 million since there establishment.
In New Delhi, these pharma companies are expected to expand about seven times (i.e., $3.7 billion) by the year 2022. Their ultimate aim is to occupy the more significant portion of the Indian market of medicine as per the foreign brokerage (CLSA) report.
The conventional chemists of physical medicine stores have always been against the concept of online medicine shop. Consequently, they went for strike quite often as a sign of protest.
The value of the Indian pharma market is about $20 billion, which is still rising cumulatively by 10 to 12 percent. Such a trend of continued revenue expansion might drive the market to rise to $35 billion by the year 2025. Well, this is just a moderate estimation note made by the CLSA.
However, the highly unorganized pharma market with around 80,000 distributors is looking to give space for an organized setup. In addition to that, about 0.85 million physical medicinal retail outlets are also providing access to online pharmacies but in a standardized format.
Apollo Pharmacy is one such instance of physically represented online pharma company with more than 3,500 existing store channels. Apart from that, the firm is leading as a successful e-pharma portal at present. Such types of other medicinal firms have also been quite successful in raising their funds to several billion dollars by now since the time they started.
According to the Frost and Sullivan report, e-pharmacy is just a small online market which does not worth more than $0.5 billion. But the daily-growing demand of people to shop for everything online has put a change in this value. The worth of this nascent e-pharmacies is more likely to rise by 7 times to $3.7 billion at the rate of 63 percent CAGR (compounded annual growth rate) triggering higher internet usability.
Currently, the pharma markets are highly catering to the subsets of long-term medicinal stores (diabetes, blood pressure, cardiac, etc., where one can decide before purchasing the drugs). Also, these stores could hardly mark themselves as references in the acute market, which otherwise is not so tough for the e-pharmacy portals.
Deep purchase discounts and promotional advertisements of these online medical stores grab more extensive customer attention and sales growth. The majority of these online medical companies are benefiting upto Rs 70-80 million every month. These stores are being highly capitalized by private equity funds, CLSA reported.
Space formalization on the issue of annual draft guidelines for the regulation of online medicinal firms could also act as a growth enabler for these stores.
The current rate of online pharma portals is only 2 to 3 percent of the Indian medical market. Therefore, these portals are restricted to bargaining power while redistributing medical goods from the manufacturer.
CLSA noted that as soon as online pharmacies attain the percentage of 10 to 15 of market share, their bargaining power will improve. Moreover, these online stores will be able to take over a major portion of market margins. Auto-generation of doctor prescription to off-branded medicines might be a game turner for the online medicine portals. This would be possible if India imposes uniform quality standards.