PharmEasy — Recipe for making one uneasy? Is it for the faint-hearted? 💊⚕️💉
I was exploring user needs, currently not served by Amazon India. Some of the alternatives included selling — prescription-based drugs, Cars, Insurance policies, Flight tickets, etc.
This drove me to explore the Indian Pharma industry & especially PharmEasy, in order to understand its overall strategy & thought process. However, the company’s business model is hard to crack & its story is even harder to comprehend.
It started as a pharmaceutical distributor followed by an e-pharmacy. And later, it started calling itself a unified health tech player. The whole, however, is not greater than the sum of its parts. Integrating & seeking synergies across businesses acquired is tough, complex, and time-intensive.
Pharma is an extremely fragmented market. Online pharmacies have captured 7% of the $25 billion domestic pharma market.
People forget that it’s the doctor/ the prescription writer who controls where the tests are done. Three of the largest e-pharmacies were acquired — NetMeds to Reliance, 1mg to Tata group, and Medlife to PharmEasy.
Reliance is building out full-stack digital health businesses. Tatas have been piloting their digital health business in Bengaluru and it will merge its business with 1mg.
When the Tatas/ Reliance get their act together, PharmEasy will find it hard to compete. Hence the race to be ahead of the curve, so that others are left chasing.
🧠PharmEasy is approaching this like some have approached other horizontal (E-Com) and vertical (education, food delivery) e-commerce businesses. Gain the largest market share and wait for it to get over, the last one standing is determined by the scale and not profitability (similar to the Telecom business landscape) Profits can always follow.
Now, as the company seeks public market validation, its approach and business model will be in the spotlight💱
Feel free to reach me at forritesh@gmail.com for feedback, questions, and ideas. Thanks for reading!
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