Prashant Tandon, founder and CEO of 1mg, an online pharmacy that offers prescription and over-the-counter medicines, talks about the e-pharma sector in India, how it operates and why it has an edge over the conventional one.
What is the immediate fallout of the Delhi High Court ban?
At 1mg, all sales are done by licensed retailers, who operate with full compliance with the Drugs and Cosmetics Act. As a platform, we receive patient requests and prescriptions. These are then forwarded to a pharmacy partner for dispensation. Hence, our model operates with full compliance and no sale takes from non-licensed players. The Delhi High Court ban is on sale through non-licensed pharmacies. Our model ensures that 100% of dispensing pharmacies have valid licences.
How big is the online pharma business in India and in Delhi? Which State has the maximum sale? Which are the fast-moving categories of drugs?
The online e-pharma business will be approximately ₹ 2,000- ₹ 2,500 crore across India. We believe that Delhi represents between 10% and 15% of the national market. Customers from across the country buy medicines via e-pharmacies and we cover more than 1,000 cities. A majority of sales are for patients on chronic therapies like diabetes and hypertension, who need their medication regularly.
How does the ban affect the customers and the industry?
In general, licensed players can continue operations. Thus, the industry and customers are not affected currently. However, this sector employs over 15,000 people and serves nearly 50 lakh patients every month, who will be concerned if there is a disruption in the access.
Who are your primary customers?
Patients from across India on chronic therapy seek convenient access to authentic medicines. These include a fair number of elderly patients, and people who are unwell and need medicines at home.
How is an online pharmacy better than a conventional one?
It is not a question of better or worse; it is more a question of a model that is suitable to serve a certain set of patients better. Four specific points here: first, the online model allows the sick, the recovering and the elderly get access to medicines as per their convenience and without having to find and get medicines by leaving home.
Second, the entire supply chain is digital, which means there is strict quality control and the authenticity is maintained by an organised e-pharmacy player. Third, we provide access to over one lakh stock keeping units by aggregating inventory of pharmacies across the country. This means that in case a specific brand is unavailable in one place, but is there in another place or even if one city is facing shortage while other cities have availability, we are able to match and balance the demand and supply. Fourth, given that we do not need to store inventory or have expensive real estate costs, we have an efficient model and are able to share some of the cost savings with the consumer. This year, consumers would have saved almost ₹ 500 crore on medicines by purchasing through e-pharmacy platforms like 1mg.
