The pandemic, and the subsequent adoption of the technology, have brought about a quantum shift in the Indian healthcare sector, with the advent of new players vying for a 2 billion dollar piece of the healthcare technology market. Recently, Flipkart also took a foray into space with Health +, joining the likes of Amazon Pharmacy, Reliance Industries’ NetMeds, Tata Group’s 1mg, and Temasek-backed PharmEasy.
While Walmart’s proprietary platform has introduced value-added services such as teleconsultation and electronic diagnostics, other platforms are also expanding their service offerings. MediBuddy, which has just secured $ 125 million in funding, and Tata 1mg are strengthening their partner networks and have built an omnichannel presence with services that go beyond just providing medicines, expanding into physical counseling, inpatient services. and even establishing distribution centers, in some cases.
Within the healthcare technology universe, the e-pharmacy segment was worth $ 700-750 million in 2021 and is expected to reach $ 2.1-2.5 billion by the end of 2023, according to Kearney partner Saumya Krishna.
Tata 1mg’s health product portfolio includes Ayurvedic and homeopathic formulations, as well as dietary supplements. As some e-pharmacies are able to deliver drugs faster through licensed local pharmacies, Antony Prashant, partner of Deloitte India, says an expansion to higher margin, non-drug products such as FMCG items is inevitable, similar to pharmacies. offline.
Both Flipkart Health + and Tata 1mg supply medicines and health products through 20,000 PIN codes in the country, while MediBuddy claims to cover most of India’s PIN codes.
“Tata 1mg is strengthening its network of logistics centers, having opened over 25 centers in recent months, with the aim of maintaining its growth trajectory near or above 100% in the coming years,” says Gaurav Agarwal, co-founder , Tata 1mg. The platform fulfills a few million orders per month and currently has a revenue growth rate of 100%, he says.
MediBuddy has 90,000 doctors, 7,000 hospitals, 3,000 diagnostic centers and 2,500 pharmacies as partners and has experienced 70% growth since the pandemic. It serves 35,000 customers every day and plans to expand to 1,00,000 patients a day in the coming months. “We wanted to create an omnichannel presence for all healthcare needs; so we built a strong network channel, ”says Satish Kannan, co-founder and CEO of MediBuddy.
Kearney’s Krishna says there is significant potential for e-pharmaceutical platforms to expand into wellness and nutraceuticals, particularly with the emergence of several online first and direct-to-consumer (D2C) brands. However, a key issue, especially for Ayurvedic products, is counterfeit medicines; these companies are addressing this problem with rigorous certifications for partner clinics.
However, Prashant says the biggest challenge is limited penetrability beyond urban environments, due to a lack of trust and a lack of awareness of the benefits. “E-pharmacies following a market model rely on qualified pharmacies for prescription brand availability, so they have limited margins to increase margins, thanks to multiple levels in the value chain,” he points out. While platforms that follow an inventory model must maintain fulfillment centers and must be positioned closer to demand centers.