The fear of contracting the virus has pushed people to take to digital platforms, be it to pay bills or to consult doctors. Online pharmacies are no exception. Case in point, the spurt in growth these platforms have been seeing over the past couple of months, which experts say, is here to stay.
For instance, when the lockdown was announced in March, 1mg, a digital consumer health platform, saw a 100 per cent surge in demand in the first three or four weeks. Cut to June, the orders are still 30-40 per cent higher compared to pre-Covid times, said co-founder Prashant Tandon. According to Samarth Sindhi, founder, Digi-Prex, a digital subscription platform for patients with chronic diseases, the company has been seeing a sustained 100 per cent surge in every day orders since the lockdown. Truemeds, another e-pharmacy platform, has also been seeing a 35-40 per cent surge in orders month-over-month, said co-founder Akshat Nayyar.
“The challenge was the initial resistance, which we are now starting to break,” said Nayyar. The target demographic for online pharmacies is people who have chronic diseases, those who require medication on a monthly basis, and mostly people in the age group of 45-80. This group earlier had a lot of resistance to technology in general — be it e-commerce or online payments, he explained.
“Because people were pushed towards trying out online platforms, we have started seeing a significant change in consumer behaviour,” Nayyar added.
Customer support
To cope with the surge, these firms have been hiring aggressively and ramping up their customer support to help consumers navigate their platform without any hiccups. They have also been expanding their network of suppliers, getting more pharmacists on board to validate prescriptions and strengthen their procurement and logistics network to provide a seamless delivery experience.
“We created a certain amount of redundancies in our system that we would have fairly taken longer to do,” said Digi-Prex’s Sindhi. The demand for medicines isn’t going to change based on online or offline pharmacies, it’s just the way people buy medicines — so once they figure out online pharmacies are faster, more efficient and cheaper, they will want to stick to it, he added.
Online pharmacies account for 1.5-2 per cent of the total pharmacy sales in India, per a 2019 Televisory blog post. With over 502 million smartphone users and 653 million mobile broadband subscribers in the country, the penetration of these platforms is only expected to grow further.
Data from Tracxn, a firm that tracks investments and financials of private companies and start-ups, showed that there are 194 active online pharmaceutical start-ups in India presently. The investment in this space boomed last year, with a total funding of $81.60 million, the highest in the past five years.
A hybrid model
The total addressable e-pharmacy market in India was valued at around $360 million last year, data from Statista, an online statistics portal, showed. The addressable chronic market for online pharmacies, which stood at $5.9 billion in 2019, is expected to surge to $10.1 billion in 2023. The addressable acute market, on the other hand, which was only at $3.4 billion last year, is expected to shoot up to $8 billion in 2023.
Experts said that to address the acute market better, online pharmacies should start partnering more with physical stores, so that while consumers continue to avail themselves of the benefits of using digital platforms for placing the order, their deliveries will be taken care of by the physical stores in the vicinity.
“The best model in the long run will be a hybrid model,” said 1mg’s Tandon. “It will be a model here and we are trying to build — partner with local pharmacies in the neighbourhood, which can deliver directly to the patient’s home especially things that are required quickly, in the next 20 minutes or so.”