Interview

e-Pharmacy: The Next Big Scope in Pharmabiz

Dr Varun Gupta

Dr Varun Gupta, Convenor, Digital Health Platform, and Senior Vice President, 1mg elucidates to Prathiba Raju, Elets News Network on the scope of e-pharmacies and its potential to streamline operation, eliminate wastage, and during pandemic how the segment played a crucial role in improving access to quality and affordable medicines.

Q How was the e-pharmacy platform before the pandemic and what are the changes, big trends, or disruptions emerging in this space?

We have been building the e-Pharmacy sector block by block, and today, it has braved the challenges posed by the COVID-19 pandemic. It gives us great pride and hope in saying that the e-pharmacies proved to be the backbone in the battle against this pandemic, and we have continuously focused on making life-saving drugs available in every nook and corner of our country. For e-pharmacies in India, it has been non-stop operations on the ground since the COVID-19. They have been at the forefront of providing lifesaving medicines and all healthcare needs at doorsteps.

At the time of the pandemic, ePharmacies had delivered medicines to 3.5 million households across the country. The sector received $700 million of investments during the FY 20 and employed 30 thousand plus skilled professionals.

After the imposition of the lockdown, e-pharmacies played the role of key enabler and delivered medicines to nine million households across the country in May 2020. The spread of e-pharmacy operations benefited people all over the country and 50 percent of the new users ordering medicines online have been from non-metro cities. MHA had listed e-pharmacy operations as essential service through an order dated 24th March, 2020. Subsequently, 19 out of 29 state governments identified e-pharmacies as essential service in accordance with the MHA directive. More than 70 percent of the consumers using e-pharmacy services during the lockdown have reported being positively impacted by the services, and e-pharmacies are witnessing a strong positive response from the investor community as well.

With the rise in popularity of the e-pharmacies, it is expected that the growth will continue strongly, and the overall number of households served is set to cross the 70 million mark by 2025. The impact of e-pharmacies is being felt in the area of streamlining chronic disease management through tech-driven pharmacy delivery.

Q How e-pharmacy is helping consumers in the pandemic. How it changed or amplified the online pharmacist’s role?

With the rise in popularity of e-pharmacies, it is expected that the growth will continue strongly, and the overall number of households served is set to cross the 70 million mark by 2025. The impact of e-pharmacies is being felt in the area of streamlining chronic disease management through tech-driven pharmacy delivery.

The pandemic clearly demonstrated how the physical and online pharmacies need to work in tandem and both play a crucial role in improving access to quality and affordable medicines across the country. All over the world, wherever e-pharmacies operate, they co-exist peacefully with retail pharmacies. While e-pharmacies are viable due to their focus on chronic therapies, retail pharmacies are necessary for the immediate requirement of acute medicines such as pain killers and antibiotics.

It has also shown that there is a need for a future-ready digital health system in India, with a resilient digital backbone and, in this light, ePharmacies have the potential to ensure efficient and affordable universal health coverage. Evidently, the technology driven efficiencies ushered into the pharmacy retail sector by e-pharmacies are essential for the future development and growth of the sector.

Q Can you tell us how The National Digital Health Mission (NDHM), aimed at improving the country’s digital health ecosystem, will boost growth in the online pharmacy segment?

A vibrant e-pharmacy remains a vital cog in the implementation of the National Digital Health Mission. It aims to empower citizens to avail all services including healthcare with more ease and convenience. It is a historic moment for the healthcare sector in the country, as revolutionary and much-needed changes are done.

As digital stakeholders of the Indian healthcare sector, we have always believed that technology is the force multiplier that is needed to improve access, authenticity, affordability, and accountability of the overall Indian healthcare ecosystem. e-Pharmacy operations are completely digital and all details pertaining to every transaction is documented can provide invaluable data and information necessary for the successful implementation of the NDHM. The announcement of the National Digital Health Mission is going to be a game-changer for the country and we are highly inspired and encouraged by the work, the government is doing in the areas such as National Digital Health Mission, Ayushman Bharat, Digital India, Start-up India, and enhancing the ease of doing business.

Moreover, e-Pharmacy technology has the ability to transform other Government initiatives like Pradhan Mantri Bhartiya Janaushadhi Pariyojana (PMBJP).

Q What is the recommendation you have for the government in regards to the e-Pharmacy Draft Rules? Why do you think it should be prioritized now? What are the immediate changes the rules can bring and how it will help the patients and providers?

The pharmacy retail sector requires an overhaul of the supply chains, technology, and access solutions to make healthcare delivery more streamlined, efficient, faster, and affordable, and a pre-requisite for this is the simple, clear, and uniform regulatory pathway for investments and innovation to thrive in this important space.

Despite this being a key sector for India and a very active sector globally attracting tremendous innovation and investment, his sector has seen significantly lower investment in comparison to its potential owing to regulatory uncertainty in our country. While sectors like fin-tech, mobility/ transportation, education, etc. have seen billions of dollars of global investment pours in and the growth of the e-Pharmacy sector has been significantly hampered. The vision of better, simpler, regulations for businesses will foster entrepreneurship, attract foreign direct investment and create jobs.

The process of bringing-out e-Pharmacy rules was initiated by DCGI in 2015 – an extended process of multi-stakeholder consultation was conducted over the last five years, with active engagement of all stakeholders. This issue was discussed multiple times at different meetings of DTAB and DCC since 2015. DTAB (Drugs Technical Advisory Board) has approved the draft rules on 11th June 2019. We have prepared and submitted representations to the Government after detailed consultations with several stakeholders.

The Government needs to notify the final e-Pharmacy rules at the earliest, to unleash the role of technology for improving access and affordability of quality medicines. We need a system to encourage and enable entrepreneurs in this sector.

Q As we see large e-commerce players, tech giants entering into this segment, what are the changes expected in this space? What measures should be taken to bring fair competition and transparency into the segment?

Competition is an inevitable part of business and beneficial for both the consumers and the markets. When firms compete with each other, consumers get the best possible prices, quantity, and quality of goods and services. It is very important to enable more competition in the pharmaceutical sector since market forces may not effectively work because of information and decision-making asymmetry for the consumers. There are already clear aspects of PN 2, 2018 (DIPP) as well as powers with the CCI India that can address any violation on account of unfair competition. New e-Commerce policy is going to be applicable to this sector as well and is expected to bring a more structured framework for fair competition.

Q Can you tell us about the technological innovations that will help the e-pharmacy model as a whole and in particular the pharmacy supply chain and how it will help in lastmile delivery?

India cannot solve its healthcare problems by operating the way it has operated all these years. We have to leverage technology in a really unique way and make quality medicines accessible to all consumers. This is a moment for strong fundamental disruption in healthcare delivery. As per the National Drug Survey 2014-106 “Facilitate regulation for transparent and secure drug distribution system which results in product traceability and reconciliation throughout the supply chain in case of a quality issue or nation-wide recall.”

Innovation in this space is critical since access to quality medicines present one of the largest opportunities to see disruption through AI, IoT, Blockchain, and other new technologies, which are absolutely key for a country like India.

Right from the outset, the purely digital model of operation makes the e-pharmacy model an innovative tech-driven service. The whole process of receiving and processing the order is digital. It is a paperless and streamlined model of operation with checks built into every step to ensure complete transparency and traceability. All the transactions made through e-pharmacies are completely recorded and stored. Every order dispensed through e-Pharmacy has a valid bill, therefore tax to the government is paid in full.

Moreover, e-pharmacies have put in various self-checks and voluntary protocols to ensure transparency and genuineness. All orders for medicines are processed only upon the furnishing of a valid doctor’s prescription and any prohibited medicines/drugs are not even listed on the inventory. Further, the online platform only works as an order receipt and processing mechanism, and each order is cross-checked by the physical pharmacy that fulfills it. Thus, the last mile connectivity issue is also resolved more efficiently with the integration of the country-wide network of physical pharmacies. These technology-driven value additions result in the consumers getting the medicines faster, easier, and in a more affordable manner.

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