Global Retail Pharmacy Market 2024–2033

Reports Description

As per the current market research conducted by CMI Team, the global Retail Pharmacy Market is expected to record a CAGR of 7.1% from 2023 to 2032. In 2022, the market size is projected to reach a valuation of USD 861.9 billion. By 2032, the valuation is anticipated to reach USD 1,215.4 billion.

Public Health Expenditure Per Capita GDP

Source: According to PUBLIC_HEALTH_EXPENDITURE_PC_GDP

The retail pharmacy serves as an independent avenue offering both branded and generic medicines to the public, with or without a prescription. The growth of pharmacy retail chains has facilitated the integration of various healthcare components, enhancing the convenience of purchasing drugs and other products for customers.

This integration allows for easier access to a wide range of medications and healthcare items, contributing to a more seamless and customer-centric healthcare experience. The retail pharmacy market functions as a customer-oriented segment within the healthcare industry, catering to individuals with varying healthcare requirements.

By offering a wide range of healthcare products and medications, retail pharmacies ensure that patients can easily access the essential items they need, contributing to an enhanced and tailored healthcare experience for customers.

Retail Pharmacy Market – Significant Growth Factors

The Retail Pharmacy Market presents significant growth opportunities due to several factors:

• Increasing Healthcare Demand: The growing global population, coupled with an aging demographic, leads to a surge in healthcare demand, resulting in higher prescription and over-the-counter medication needs. This, in turn, positively impacts the retail pharmacy market, as these establishments become vital healthcare providers serving diverse customer requirements.

• Advancements in Technology: Technological innovations have revolutionized the retail pharmacy sector, leading to increased efficiency and accessibility. The adoption of telepharmacy services, mobile applications for prescription ordering and medication reminders, and digital platforms for home delivery and online consultations have significantly improved customer experience and convenience, driving the growth of the retail pharmacy market.

• Emphasis on Preventive Healthcare: The growing focus on preventive healthcare and wellness among consumers encourages the demand for over-the-counter products, vitamins, supplements, and health monitoring devices. Retail pharmacies play a pivotal role in providing these wellness products, capitalizing on the rising consumer interest in self-care and preventive health measures.

• E-Commerce Expansion: The retail pharmacy market has a promising opportunity to invest in and expand its e-commerce capabilities. By developing user-friendly online platforms, retail pharmacies can cater to the growing demand for digital convenience, allowing customers to order medications and healthcare products from the comfort of their homes, and potentially reach a broader customer base.

• Personalized Healthcare Services: With the aid of advanced data analytics and customer insights, retail pharmacies can offer personalized healthcare recommendations and tailored services to individual customers. By understanding customer preferences, medical history, and specific healthcare needs, retail pharmacies can create more engaging customer experiences, fostering loyalty and satisfaction, and standing out in an increasingly competitive market landscape.

• Strategic Partnerships and Collaborations: Retail pharmacies are actively seeking strategic partnerships and collaborations with various stakeholders in the healthcare ecosystem. By teaming up with healthcare providers, insurance companies, and pharmaceutical manufacturers, retail pharmacies can enhance their service offerings, broaden their product portfolios, and expand their market reach, creating opportunities for sustainable growth.

Retail Pharmacy Market – Mergers and Acquisitions

The Retail Pharmacy Market has seen several mergers and acquisitions in recent years, with companies seeking to expand their market presence and leverage synergies to improve their product offerings and profitability. Some notable examples of mergers and acquisitions in the Retail Pharmacy Market include:

• Walgreens Boots Alliance Enters into Agreement with Rite Aid: This new agreement replaces the previous merger agreement with Rite Aid, announced in October 2015 and amended in January 2017, and the agreement to divest certain Rite Aid stores to Fred’s, Inc. announced in December 2016. Both of these agreements have been terminated, and Walgreens Boots Alliance will pay Rite Aid the $325 billion termination fee with respect to their merger agreement.

• Kroger and Walgreens Alliance: In 2019, Kroger, a major supermarket chain, and Walgreens announced a strategic alliance. As part of the partnership, select Kroger grocery stores started housing Walgreen’s health and beauty products, creating a unique “Kroger Express” section.

• CVS Health and Teladoc Health Partnership: In 2018, CVS Health partnered with Teladoc Health, a leading telehealth provider. The collaboration integrated Teladoc’s virtual care platform into CVS Health’s MinuteClinic locations, enabling customers to access telehealth services for minor illnesses and injuries. This partnership expanded CVS Health’s healthcare offerings, providing customers with convenient and remote healthcare options.

• Walgreens Boots Alliance’s agreement with AmerisourceBergen: In 2021, AmerisourceBergen Corporation (NYSE: ABC) and Walgreens Boots Alliance, Inc. (Nasdaq: WBA) announced strategic agreements under which AmerisourceBergen will acquire the majority of Walgreens Boots Alliance’s Alliance Healthcare businesses for approximately $6.5 billion, comprised of $6.275 billion in cash and 2 billion shares of AmerisourceBergen common stock.

These mergers and acquisitions have helped companies expand their product offerings, improve their market presence, and capitalize on growth opportunities in the Retail Pharmacy Market. The trend is expected to continue as companies seek to gain a competitive edge in the market.

COMPARATIVE ANALYSIS OF THE RELATED MARKET

Retail Pharmacy Market – Significant Threats

The Retail Pharmacy Market faces several significant threats that could impact its growth and profitability in the future. Some of these threats include:

• Changing Consumer Behaviour: Shifting consumer preferences and behaviours present another threat to the retail pharmacy market. As consumers become more tech-savvy and accustomed to online shopping, there is a growing inclination towards digital healthcare services and e-commerce platforms. This change in behaviour may lead to a decline in foot traffic at physical retail pharmacies and a potential loss of customers to digital competitors, necessitating adaptation to meet evolving consumer demands and expectations.

• Drug Price Fluctuations: Volatile drug pricing, influenced by factors like government regulations and pharmaceutical manufacturer decisions, can impact retail pharmacies’ profitability. Sudden price fluctuations may affect their ability to maintain affordable pricing for customers.

• Prescription Drug Legislation: Changes in prescription drug legislation and reimbursement policies can impact retail pharmacies’ revenue streams and operational processes. Stringent regulations may require additional compliance measures, potentially increasing costs and administrative burdens.

• Pharmaceutical Industry Consolidation: Consolidation within the pharmaceutical industry may lead to fewer choices for retail pharmacies in sourcing medications. Limited supplier options and potential supply chain disruptions can adversely affect inventory availability and pricing stability.

Report Scope

Category-Wise Insights

By Channel:

• Online: Online retail pharmacies operate through digital platforms, providing customers with the convenience of ordering medications and healthcare products online. The trend in the Retail Pharmacy Market involves the rapid growth of online pharmacies, driven by technologically advanced consumers seeking convenience, competitive pricing, and expanded product selections, challenging the traditional offline brick-and-mortar pharmacy model.

• Offline: Offline retail pharmacies operate physical stores where customers can directly purchase medications and healthcare products. The trend in the Retail Pharmacy Market indicates a need for adaptation and innovation among traditional brick-and-mortar pharmacies to compete with the rising popularity of online pharmacies and changing consumer preferences for digital convenience.

By Type:

• Generic: Generic medications are non-branded versions of drugs, offering the same active ingredients as their brand-name counterparts but at lower prices. The retail pharmacy market witnesses a growing preference for generics due to cost-effectiveness, driving their availability and utilization, leading to increased cost savings for customers.

• Over the Counter (OTC): These medications are non-prescription drugs available without a doctor’s prescription. The retail pharmacy market experiences a rising demand for OTC products due to the convenience and accessibility they offer. Retail pharmacies expand their OTC offerings to cater to the growing consumer interest in self-care and minor ailment treatments.

• Patented: Patented medications are brand-name drugs protected by patents, granting exclusivity to the manufacturer for a specified period. Retail pharmacies face challenges in offering patented medications due to higher costs, limited availability, and competition from generic alternatives, while also striving to provide necessary patient access to innovative treatments.

By Application

• Drug Retail: Drug retail involves the sale and distribution of both prescription and over-the-counter medications directly to consumers. This application segment serves as a primary channel for individuals to obtain vital pharmaceutical products and medical treatments from traditional physical pharmacies or through online platforms.

• Health Products Retail: Health products retail specializes in offering a wide range of health and wellness products such as vitamins, supplements, personal care items, and medical devices. This application segment caters to the growing consumer preference for self-care and preventive healthcare solutions.

• Equipment Retail: Equipment retail in the retail pharmacy market involves the supply of medical equipment and supplies, such as blood pressure monitors, glucose meters, and mobility aids. This segment addresses the demand for home healthcare equipment and aids in patient self-monitoring and management.

By End Use

• Consumer/Patients: This end-use segment refers to individual customers seeking medications and healthcare products for personal use from retail pharmacies. They constitute the primary customer base, driving demand for prescription and over-the-counter medications, health products, and medical equipment.

• Traditional Medicine Practitioners: This end-use segment comprises professionals using medicinal materials and proprietary Chinese medicines in traditional healthcare practices. Retail pharmacies serving this segment offer specialized products to cater to the unique requirements of traditional medicine practitioners.

• Healthcare Facilities: This segment includes hospitals, clinics, and nursing homes procuring medications and supplies from retail pharmacies for patient care. The demand from healthcare facilities contributes significantly to the retail pharmacy market’s revenue and ensures seamless patient treatment.

Retail Pharmacy Market – Regional Analysis

The Retail Pharmacy Market is segmented into various regions, including North America, Europe, Asia-Pacific, and LAMEA. Here is a brief overview of each region:

• North America: North America is witnessing a growing trend of telepharmacy and remote healthcare services, driven by advancements in technology and the need for convenient and accessible healthcare solutions. Retail pharmacies in this region are leveraging digital platforms to offer teleconsultations, medication delivery, and prescription services, enhancing customer convenience and safety.

• Europe: In Europe, there is a notable trend towards sustainability and eco-friendliness in the retail pharmacy market. Pharmacies are adopting green initiatives such as reducing single-use plastic packaging, promoting eco-friendly products, and implementing recycling programs. This shift aligns with the region’s increasing focus on environmental consciousness and responsible business practices.

• Asia-Pacific: In the Asia-Pacific region, there is a rich tradition of utilizing traditional medicine, including herbal remedies and proprietary Chinese medicines. Retail pharmacies in this area are witnessing a growing demand for traditional healthcare products as consumers increasingly seek alternative and holistic healthcare solutions.

• LAMEA (Latin America, Middle East, and Africa): The LAMEA region is witnessing an expansion of retail pharmacies in underserved areas, catering to remote and rural communities. This trend is driven by efforts to improve healthcare access and meet the growing demand for medications and healthcare products. Pharmacies are strategically located in these regions to bridge the healthcare gap and enhance healthcare equity in the region.

Competitive Landscape – Retail Pharmacy Market

The Retail Pharmacy Market is highly competitive, with a large number of manufacturers and retailers operating globally. Some of the key players in the market include:

• Walgreens Boots Alliance Inc.
• CVS Health Corporation
• Rite Aid Corporation
• Walmart Inc. (operates Walmart Pharmacy)
• Wal-Mart de México, S.A.B. de C.V. (operates Walmart pharmacies in Mexico)
• Costco Wholesale Corporation (operates Costco Pharmacy)
• Kroger Co. (operates Kroger Pharmacy)
• McKesson Corporation
• Cardinal Health Inc.
• AmerisourceBergen Corporation
• Others

These companies operate in the market through various strategies such as product innovation, mergers and acquisitions, and partnerships.

In the Retail Pharmacy Market, new players such as online pharmacy platforms, digital health startups, and tech-driven companies are adopting innovation and development to enter the industry. These new players leverage advanced technologies like AI-driven prescription systems, telemedicine services, and seamless home delivery to cater to evolving consumer demands.

Meanwhile, key players dominating the market include established pharmacy chains, national retailers, and vertically integrated healthcare companies. Their dominance is driven by extensive networks, brand recognition, and strategic partnerships, giving them a competitive edge in the evolving healthcare landscape.

The Retail Pharmacy Market is segmented as follows:

By Type

• Generic Medications
• Over the Counter (OTC) Medications
• Patented or Brand-name Medications

By Application

• Drug Retail
• Health Products Retail
• Equipment Retail

By End Use

• Consumer/Patients
• Healthcare Facilities
• Traditional Medicine Practitioners

By Channel

• Online
• Offline

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America

Europe

• Germany
• France
• U.K.
• Italy
• Spain
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• Rest of Asia Pacific

The Middle East & Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of the Middle East & Africa

Latin America

• Brazil
• Argentina
• Rest of Latin America