Credit Lyonnais Securities Asia (CLSA) - there are several e-pharmacies operating currently but Netmeds, Pharmeasy, Medlife, and 1mg have emerged as the key players with a pan-India reach. These companies have cumulatively raised close to $400 million since starting out.
According to a research note by foreign brokerage, CLSA, the e-pharmacies are expected to grow seven times to $3.7 billion by CY22 as they aim to grab a large part of the highly fragmented Indian market.
The Indian pharma market is valued at $20 billion and has been growing at 10-12 percent. Continuation of current growth trends could propel the market to $35 billion by 2025, the report noted.
According to CLSA, there are several e-pharmacies operating currently but Netmeds, Pharmeasy, Medlife, and 1mg have emerged as the key players with a pan-India reach.
Apollo Pharmacy with 3,500 stores is the largest offline pharmacy and is also piloting an e-pharma portal. These companies have cumulatively raised close to $400 million since starting out.
As per Frost and Sullivan, e-pharmacy is a nascent market worth $0.5 billion, but it is expected to grow nearly 7 times at 63 percent compounded annual growth rate (CAGR) to $3.7 billion by 2022, riding higher internet penetration.
At present, e-pharmacies largely provide to a subset of the chronic market (cardiac, diabetes where drug purchases can be planned) and their penetration of the acute market has been tough.
E-pharmacies currently comprise only 2-3 percent of the India pharma market and thus have limited bargaining power while sourcing from the manufacturer.
Once e-pharmacies are able to garner 10-15 percent share of the market, they are likely to have better bargaining power and could then be able to capture a larger pie of margins.