Startups inject fresh momentum into unorganised pharma market
Startups have set eyes on a $55-60 billion US market as well
Pharma startups are tapping the ‘Kirana shops in their bid to penetrate into the unorganised market in small towns and cities. The new players have such high ambition that they set their eyes on the unorganised pharma market in the US as well.
For instance, MedleyMed has set its eyes on an estimated $55-60 billion unorganised pharma retail market in the US. According to M Satish, managing director (MD), Athena Global Technologies and MedleyMed, the 15% unorganised pharma market in the US is serviced by around 5,000 retail stores. MedleyMed is trying to get these small-scale and mid-sized wholesalers and retailers on board.
Setting eyes on US markets
The Business Standard in a report quoted Satish as saying that the $55-60 billion was a sizeable market that MedleyMed wants to tap. He said his company would approach generic pharma companies based out of India in order to tap this segment.
The company already has business spread across India which includes supplying drugs to pharmacies and offering telemedicine. MedleyMed offers to create a network of franchise stores, of some 41,800 pharmacies by 2023, by offering retail pharmacies their branding.
Other start-ups are also looking to create their own space in the unorganised retail pharmacy market.
India is one of the biggest pharma markets in the world. The market size is now estimated at $42 billion. It is expected to grow to $65 billion within the next three years and to $120-130 billion in the next nine years.
Growing in micro-spaces
The aim of Rajasthan-based Dawaa Dost, which is backed by Singapore Angel Network, is to be within five minutes of every Indian. Dawaa Dost is realising this dream by leveraging the kirana store network in the country. Almost 2,500 kirana stores have been onboarded by Dawaa Dost around Jaipur so far. This is how it works – the company takes orders from kirana stores, which work as feeders to generate orders, using their own platform and then process those orders through Dawaa Dost stores. Amit Choudhury, its chief executive officer (CEO), is quoted in the report as saying that 35% of the Kirana stores registered with them have given Dawaa Dost orders in any given month, which is a figure that he wants to raise to 66%, by creating a network of 15,000 kirana stores within a year’s time.
The startup has reportedly recorded over 12X growth over the past one year.
Ankur Agarwal, founder and director of pharmacy chain Medkart, which runs stores across Gujarat, Maharashtra and Rajasthan, feels that the organised pharmacy market in India is regional. He gave the example of Wellness Forever and Noble, which have a good presence in West India, while Apollo with its network of 3,500 stores, has a healthy presence in the Southern Indian market.
He believes that there is enough scope for retail pharmacies to grow in micro-market spaces, giving the example of Medkart, which plans to strengthen its presence in Gujarat and Rajasthan instead of expanding to other states.