What Is the E-Pharmacy Business Model?
The eCommerce pharmacy business model is a new form of digital healthcare that uses the internet and eCommerce tools to allow customers to purchase pharmaceuticals from anywhere in the world. This business model has enabled consumers to access medication quickly and conveniently while also providing cost savings.
The process typically involves customers placing orders online, with the pharmacy then sending them the medication through mail or delivery services. By reducing the need for physical stores, e-pharmacies can provide customers with greater convenience and better affordability. They are currently gaining popularity as an alternative to traditional brick-and-mortar pharmacies due to their advantages such as round-the-clock availability and better pricing.
The Advantages of E-Pharmacy
Many of the advantages of owning an e-pharmacy start with the customers and how they will interact with your store. If you provide a better experience for customers, they're more likely to choose you over a traditional brick-and-mortar pharmacy.
Convenience
E-pharmacies give customers the ability to purchase medications from anywhere in the world. Customers no longer have to physically visit a local pharmacy or drug store, but instead can make purchases online and have them delivered directly to their doorstep. This eliminates the time and effort associated with making trips to a physical store.
In addition, many e-pharmacies provide customers with 24/7 availability and access to detailed information about medications that may not be available in stores. Customers also benefit from the cost savings associated with buying medication online due to reduced overhead costs.
Wider Product Range
E-pharmacies give customers a wider product range is that it allows them to access medication and medical products that may not be available in a traditional pharmacy. By utilizing online databases and online suppliers, e-pharmacies can provide customers with a greater selection of products than those typically found in physical stores. This gives customers the ability to find specialized medications or medical equipment that may otherwise be difficult to obtain from local pharmacies.
Many e-pharmacies stock over-the-counter drugs and other items such as vitamins and supplements that are not commonly stocked in brick-and-mortar stores. In this way, e-pharmacies can offer customers a more comprehensive selection of products compared to traditional pharmacies.
Lower Costs
This advantage should be pretty obvious: Providing customers with lower costs allows them to save money. E-pharmacies can often offer reduced prices due to their lower overhead costs, such as not having to pay for physical store space or staffing costs. Furthermore, many e-pharmacies pass on additional savings to customers in the form of discounts and promotional offers.
By taking advantage of these cost reductions, customers are able to save significantly over purchasing medications from traditional stores. Additionally, some e-pharmacies offer free shipping and delivery services which further reduce costs for customers. In this way, e-pharmacies can provide significant savings to customers over traditional pharmacies.
Privacy
Many traditional pharmacies require customers to provide their personal information and make purchases in person, which can leave them feeling exposed and vulnerable. By contrast, e-pharmacies offer a much higher level of privacy as customers are not required to present any identification or reveal their medical history when making a purchase.
Due to the digital nature of the transactions made through an e-pharmacy, all payments and customer data are securely protected by modern encryption technologies, keeping customers' private information safe from prying eyes. In this way, e-pharmacies are able to offer customers greater privacy than that provided by traditional stores.
Accessibility
One of the main advantages of giving customers better accessibility is that it allows rural customers to access medication that may not be available in their local area. By providing customers with an online ordering service, e-pharmacies can make it much easier for rural customers to purchase medication, regardless of their location.
This is especially valuable for those living in remote areas who may have difficulty accessing traditional pharmacies due to transportation or travel constraints. E-pharmacies offer delivery services that allow rural customers to have medication delivered directly to their door, further increasing accessibility for those who cannot easily travel to a store. In this way, e-pharmacies are able to provide better accessibility and convenience for all customers, including those living in rural areas.
The Disadvantages of E-Pharmacy
While there are many advantages of pharmacy eCommerce, it's important to be away of the challenges you may face with this business model.
Lack of Physical Interaction
While customers can use a chat feature to talk to someone about their prescription, e-pharmacies don't allow for face-to-face interaction with pharmacists. Brick-and-mortar pharmacies allow customers to have one-on-one conversations with their pharmacist, which can help to provide greater understanding and assurance when purchasing medication.
By contrast, due to the digital nature of e-pharmacies, customers are not able to engage in such conversations and instead must rely solely on their own knowledge or seek advice from external sources when it comes to selecting and taking medications correctly. This can lead to confusion for some customers and can cause potential safety issues if the wrong dosage or type of medication is taken.
It is important that e-pharmacies provide clear usage instructions so that all customers are aware of how to safely use medications purchased online. Offering a chat option—or even video chat with a pharmacist—can put their minds at ease. Seeing someone on the other end of the transaction can also give customers a sense of loyalty to a particular e-pharmacy.
Differentiating Yourself from Counterfeiters
Competing with counterfeit medication sellers can be a major disadvantage. Counterfeit medications are often produced with inferior ingredients and without the necessary safety standards in place, which can lead to significant health risks for customers who purchase them. No matter how quickly the drug enforcement administration takes them down, they just pop back up.
E-pharmacies must take extra steps to ensure that their products are safe and authentic, as even a single case of distributing counterfeit medications can cause serious damage to an e- pharmacy's reputation. Additionally, counterfeiting is illegal in many countries and therefore e-pharmacies may face legal action if they unknowingly distribute such products.
Counterfeit medication sellers also have access to cheaper production costs and prices due to their lack of regulations and standards, giving them an unfair economic advantage over legitimate e-pharmacies which have stricter regulations in place.
In other words, it can be difficult to differentiate your legitimate business from counterfeit sellers who are also advertising the same products at exponentially cheaper prices.
Delivery Times
From an e-pharmacy point of view, one of the main disadvantages is delivery times compared to brick-and-mortar pharmacies. Due to the distance between e-pharmacies and customers, there is usually a longer lead time for medications to be delivered. This can delay the process of receiving necessary treatments and can be especially problematic for those suffering from illnesses or chronic conditions that require prompt attention.
In contrast, brick-and-mortar pharmacies can provide customers with immediate access to medications, allowing them to receive medical care more quickly and conveniently. Due to geographical considerations such as traffic congestion or bad weather, delivery times for e-pharmacies may sometimes exceed expectations, further hindering their convenience.
How to Take Advantage of the E-Pharmacy Model
- Seek professional advice: While e-pharmacy may lack face-to-face interaction with pharmacists, customers can still seek professional advice by contacting online pharmacists via email, phone, chat, or video chat. It is important to ensure that the online pharmacy has a registered pharmacist available to provide guidance and advice.
- Verify Authenticity: Like all pharmacies, online pharmacies must ensure that the medications they purchase are reputable and authorized by regulatory bodies such as the FDA. Since you'll be engaging in B2B eCommerce transactions with suppliers, perform thorough research on all pharmaceutical suppliers.
- Getting Prescriptions: Utilize prescription transfer software that is integrated with EMR/EHR software and uses HL7 protocols to ensure standardized data. Doing this will allow you to accept prescriptions from most doctors. Making use an of electronic prescribing system can also help reduce prescribing errors.
- Ensure HIPAA Compliance: It's absolutely vital that you put HIPAA compliance at the forefront of your plans when building your online pharmacy. Failure to do so could result in government fines and loss of customer confidence. This means investing in a HIPAA-compliant website and secure hosting for it.
- Electronic versus Traditional Prescriptions: Because there's so much less chance of misreading a doctors handwritten prescriptions, patient safety is increased with e-prescribing.
The Future of E-Pharmacy
The trend toward digitalization in the healthcare industry is expected to continue, with e-pharmacy playing a significant role in this transformation. With the global pandemic accelerating the adoption of digital healthcare solutions, e-pharmacy is poised for significant growth in the coming years.
According to a report by Grand View Research, the global e-pharmacy market size is expected to reach USD 146.1 billion by 2028, growing at a compound annual growth rate (CAGR) of 16.3% from 2021 to 2028. This growth can be attributed to factors such as the increasing prevalence of chronic diseases, rising healthcare costs, and the growing demand for convenient and accessible healthcare services.
Technological advancements such as artificial intelligence, big data analytics, and blockchain are expected to improve the efficiency and effectiveness of e-pharmacy, further fueling the growth of the market. These technologies can enable e-pharmacies to provide personalized medication recommendations, prevent medication errors, and enhance supply chain transparency.
