Amazon’s recent announcement of its new unlimited drug delivery subscription offers hope for a convenient and affordable online option for buying drugs in the US. In Africa, pharmacy retail has already been quietly disrupted.
African online pharmacies such as MyDawa, AddPharma and myMedicines as well as online shops of many stationary pharmacy chains such as GoodLife and HealthPlus have brought traditional pharmacy retail into the modern world of e-commerce. Significant funds have flown, with MyDawa leading the way with over $9 million to date. Investors hope for a profit 34% of Africans are active e-commerce users.
These retailers have successfully built full-service outlets for both high and low cost, defined ways to collaborate with pharmaceutical distributors, and adopted low-tech methods to make their services as convenient and immediate as possible.
Amazon Pharmacy vs. African Pharma Startups
African e-pharmacies have struggled to differentiate between inexpensive emergency treatments and higher-value medicines for chronic conditions. Amazon Pharmacy’s strategy of focusing solely on long-acting drugs promises profit maximization but misses the larger customer need that’s critical to customer acquisition.
According to Abimbola Adebakin, Founder and CEO of Nigerian e-retailer myMedicines, “Our approach was to fill a gap for everyone in need of medication and we have a huge acute medical needs in Nigeria. It’s the higher hanging fruit, but the more urgent need in less developed countries.” MyMedicines and its counterparts provide much-needed medicines such as antibiotics, antivirals and anti-inflammatory drugs that are available within hours.
Offering medicines for acute conditions is an important way to motivate customers to try online pharmacies for the first time. The need for medicines delivered to consumers’ doorsteps becomes critical when customers are ill and need medicines quickly without having to leave their homes. “Many people come to us for urgent reasons and after trying our system, they stay with us,” adds Adebakin.
pharmaceutical distributor
Pharmaceutical retailers around the world play a role in the long journey from manufacturer to consumer. While Amazon has done little to clarify how they will compete with the distribution giants, African players have begun dividing up the value chain, with an emphasis on cooperation rather than competition.
Online pharmacies identify the shopping cart demanded by customers with whom they have a direct relationship, providing merchants with a convenient route to market. For Africure Pharmaceuticals, one of the largest players with manufacturing sites and distribution capabilities across sub-Saharan Africa, “wherever we manufacture and an e-pharmacy is set up, there is potential for collaboration,” says CEO Sinhue Noronha. “Where they’re willing to take on our products, we’re going to get a lot more visibility in the marketplace.”
These types of partners can also guarantee manufacturer discounts and product access. “The e-pharmacy that collects our product collects a registered product in that country. And when it’s made in-country, they can count on a full supply chain process with no hiccups. When you import products made in India or China, the question of supply and supply chain issues arises,” adds Noronha.
prescription check
Another challenge in moving retail pharmacies online is prescription verification. Despite the temptation to digitize a manual, error-prone method of capturing doctor’s orders using pen and paper, African e-pharmacy startups have been building on it. They recognize that the customer journey can be partially offline and even more efficient, especially when end-to-end digitization would require reimagining a centuries-old practice. Most websites only require a photo upload of a paper prescription with live help via WhatsApp for questions and troubleshooting.
Amazon Pharmacy arguably made the high-tech process a mistake. Patients select the provider or pharmacy that holds their prescription, and Amazon does the legwork of contacting them and transferring the prescription. However, the process is opaque and far from instant, which undermines the simplicity that buying online is supposed to offer.
Building an online pharmacy business in Africa is undoubtedly easier than in the US with its healthcare complexities. Pharmacy benefit management middlemen, manufacturer discounts, insurance forms, and competition from existing mail-order pharmacies create numerous distractions from the premise of moving pharmacy transactions online.
Patient-centric focus
But savvy businesses recognize that the most complicated problems are often not the ones that need to be solved first. African online pharmacies have set themselves a clear goal: to deliver medicines to patients quickly and conveniently via an online platform—and delivered on it. This clear focus underlies their success and is a reminder of the importance of patient centricity amidst market complexity.
African startups have disrupted the retail pharmacy with their relentless focus on improving the patient experience and their recognition of market conditions to circumvent. Amazon and other players in the US have yet to master these principles, despite their experience and size. Largely ignored by Amazon’s existing stores, the continent could soon become their biggest competitive threat in the online pharmacy market.
