The Rise of Digital Pharmacies—How Will This Shape the Future of Pharmacy?
July 21st, 2020
Digital pharmacies are growing and expanding their influence. What does this emerging player mean for retail, chain, and independent pharmacy market share?
In the modern world, everything can become digital. Technology allows us to do or obtain just about anything we need online. That now includes prescription medicines. Digital pharmacies are seeing substantial growth, and it started long before COVID-19.
PillPack—The Literal Amazon of Digital Pharmacies
The wave of online pharmacy adoption began with PillPack, funded by the innovations of eCommerce giant Amazon. Consumers looked to PillPack and others for convenience. Consumers in 2020 don’t want to wait in lines or chase down.
Amazon, a master at marketing, has been able to gain momentum in market share. They’ve even filed trademarks on the global level, indicating they are serious about international expansion.
Now others in the space are seeing growth, finding funding, and making plans to take on the leading retail pharmacies.
Digital Demand Grows, Investments Follow
Several digital pharmacy startups are making headlines relating to funding. Fierce Healthcare recently published a story highlighting these new players.
Medly Pharmacy received $100 million in series B funding. Launched in 2017, the company has already increased revenue by 100%. This new money will help them expand beyond their current area.
Others making moves include NowRx, which used crowdfunding to gain funding. The company’s founder felt compelled to change the pharmacy experience, which is still heavily reliant on paper scripts and in-person pickups. However, most retail pharmacies do have alternatives—mail order, curbside pickup, and delivery. Many have expanded these services during the pandemic.
Alto Pharmacy and Truepill are also staking their claim in the pharmacy market. But what makes them so competitive?
It’s more than just convenience for the patient.
Digital Pharmacies Want to Disrupt the Industry
Yes, consumers want simplicity. Like any other thing they buy, they want it to appear on their doorstep. That’s only part of the equation.
Digital pharmacies want to meet the need in the market. And the need is multi-generational. Older patients may be unable to go to the pharmacy physically. Millennials are digital natives. It’s attractive to all.
Its appeal is not specific to urban areas. Those that live in cities have more options and certainly appreciate meds delivered. However, rural patients can find advantages as well, especially in pharmacy deserts—areas with limited access to pharmacies.
The shift is consumer-driven, but it’s also about revolutionizing the entire process. These new pharmacies lean on automation, robotics, and technology to increase efficiency and streamline dispensing and insurance approvals.
It’s not that retail pharmacies aren’t leveraging these tools. They are, in some instances. The big chains are but still rely greatly on the in-store experience. Independent pharmacies may not be able to invest in advanced technology. Their position to retain patients is about relationships.
Is a Hybrid Approach the Future?
Is the ideal pharmacy of the future one that is equal parts technology and personalization? Technology will enable them to scale and reduce costs. In doing so, pharmacists may have more time to build relationships with patients, consulting with them more about their medications and chronic conditions.
Who will dominate the market in the next five years? That’s unknown for now. Internal and external factors will influence the answer. No matter what pharmacy operations look like in the future, data will continue to be critical to everything they do, and we’ll be there to support all pharmacies in their data management needs.