#no5

by Andreas Olpeter
#Abouthealthcareandsupplychain #No5

The increasing role of online-pharmacies during Corona – and beyond...

The increasing online-Pharmacy business in Europe is a logical answer to changing market conditions, patients‘ needs and customers’ behavior.

“Click here to receive your prescription pharmaceuticals delivered to your doorstep”.

Cosmetics, medical products, over-the-counter medications and now also prescription pharmaceuticals are already available via online channels in some European markets. A world is changing…

More and more EU members already announced to authorize extended internet pharmacy businesses. Recently, also the French government published its plans to enable OTC drugs to be purchased via online channels and – of course – received a strong headwind from established market players.

During the current Corona-crisis, online pharmacies in Europe are showing a massive increase in their businesses. Instead of joining the queue in front of public pharmacies (where too often social distancing and personal protection is difficult to manage), many customers and patients make use of the home delivery service of online-pharmacies. Moreover, many of them tried this new market channel for the first time, discovered its benefits and said that they would continue to order their products online also in the post-Corona time. This is why online pharmacies undoubtedly belong to the beneficiaries of COVID-19.  

But the growing success of online-pharmacies started even before the current pandemic.

Whilst the overall European OTC market of pharmaceutical products (public and internet pharmacies) grew by 2% in 2019, the internet pharmacy business alone grew by 6%. In the context of the corona crisis, it can be assumed that the growth figures for 2020 will be even higher.

An honest and unprejudiced look at this development makes the reasons behind easy to understand. The European supply model of pharmaceutical products to patients is reliable and secure. And still somehow it seems to be sick in itself why critical voices for reforms are raised more and more.

Patients are customers and their needs and habits are changing in an increasingly digitized world. Online buyers value the secure processes, market-transparency, flexibility, convenience (including “contactless shopping”) and – last but not least – cost advantages when ordering products “with a click” and receive the shipments delivered to their doorstep.

In this context, it is becoming increasingly difficult to explain to patients, why they should not be able to order their medicine online whilst they can do so with almost all other products in their life (consumer products, food, cars etc.). The growing availability of e-prescriptions in Europe will further accelerate the change and demands alternative structures.

US internet pharmacy Pill-Pack (an Amazon-company) offers exactly such services to patients and its increasing success is undisputed.

Now many will argue that Europe is different – and they are right to a certain extend. In many EU countries, pharmacies have to be owner-operated, with manifold different specific local regulations on top. And YES, the different European healthcare markets and their mechanisms makes it difficult if not impossible for a “one size fits all” approach.

However, also in Europe we witness an increasing debate about changing market conditions and new sales channels for healthcare products. We see a rapid growth of “E-commerce” and “direct-to-patient” delivery models for medical devices and an increasing number of manufacturers of pharmaceutical products seek for new ways of patient care.

Although the reasons for the implementation of new and direct sales channels are manifold, they have one thing in common: the wish for a secure, cost-effective, future-looking and customer-friendly commercial distribution solution.

Patients have the sole and full control over their prescription. They will have the choice to either continuously carry their smartphone with the e-prescription to a public pharmacy or to simply “click a button” and forward to an online pharmacy.

We witness a changing patient behavior, driven by digitization, changing working environments and lifestyle and – last but not least – new expectations towards support for their disease. This “pull-effect” will continue to drive the change…

Officially authorized online pharmacies are secure, their services reliable and their prices attractive. They represent an ever-increasing new supply model of pharmaceutical products (being it “over-the-counter” or prescription products).

However, the new ecosystem in pharmaceutical distribution in Europe will require both, the “established” and the “new” delivery models.

This is why Arvato offers manufacturers of healthcare products either in the Pharmaceutical or the Med-Tech sector healthcare supply chain solutions for all sales channels, being it B2B and/or B2C.

We at Arvato operate commercial distribution solutions in a transparent and reliable way via our highly efficient supply solutions, being it direct to hospitals, wholesalers, pharmacies or increasingly important direct to patients.

Many medical devices manufacturer already rely on our patient supply solutions and we empower more and more pharmaceutical manufacturers to implement such direct delivery models to the end customer, too.

Furthermore, we enable pharmacists to implement and operate online-businesses, from web-shop design via customer care, logistics solutions up to financial processes.

Healthcare

Find out more about the business Unit Healthcare!

Learn more

Do you have any questions? Get in touch with me!

Andreas Olpeter

Andreas Olpeter

Vice President Sales & Business Development - Healthcare