Exploring Pharma eCommerce: Current Landscape, Key Initiatives, and Trends

Compared to other sectors, the pharmaceutical industry accounts for just a small portion (about 0.86%) of the global eCommerce market, worth $8.8 trillion (about $27,000 per person in the US) in 2024. Yet, the market is proliferating and catching up with other sectors, thanks to the COVID-19 pandemic, ongoing digital transformation, and supportive regulatory environments.

Despite the regulatory complexities, opaque pricing structures, and sensitive nature of pharmaceutical products, in recent years, we’ve seen many new eCommerce solutions emerge in both the B2C and B2B spaces to meet the demands of a digital-first world. These range from online pharmacies and telehealth services, which make getting digital prescriptions and medications more convenient, to raw material marketplaces and specialty drug distribution platforms, designed to streamline R&D procurement and distribution of pharmaceutical products.

While the industry is still actively shaping and evolving, this article tries to capture a slice of what it looks and feels like today. We'll look at the current state of the sector and emerging trends in pharma eCommerce, examples of digital commerce initiatives, and the challenges that one might face launching an online pharmaceutical marketplace or other eCommerce solution.

1. NAVIGATING THE DIGITAL FRONTIER: PHARMA’S GRADUAL SHIFT TO ECOMMERCE
2. BEHIND THE COUNTER: HOW ECOMMERCE IS RESHAPING THE B2B PHARMACEUTICAL SECTOR
3. POSSIBLE CHALLENGES AND NUANCES IN LAUNCHING AN ONLINE PHARMACEUTICAL COMMERCE PLATFORM
4. CONCLUSION

As we mentioned in our previous article, despite being one of the world's largest and most profitable industries, pharma was lagging behind other sectors in digital transformation due to the nature of its goods and strict legal requirements. That’s why it’s no surprise that the penetration of eCommerce was also slower and more gradual than in other industries, both in B2C and B2B segments.

For instance, in 2024, the pharmaceutical B2B eCommerce market reached $30.2 billion and is expected to grow at a CAGR of 7.7% to reach USD 47.27 billion by 2030. In comparison, the global FMCG B2B eCommerce market was valued at $520.8 billion back in 2021 and is projected to reach $1220.5 billion by 2031. Yet, the market is thriving and shows a growing appetite for digital commerce models thanks to shifting consumer and business demands, technological innovations, and, of course, the push from COVID-19.

The B2C pharma eCommerce segment experienced massive pandemic-induced growth when consumers suddenly and rather urgently switched from offline to online shopping for prescription and OTC medication and healthcare products. This, in turn, changed the future of retail pharmacies, pushing pharmacy owners to launch digital storefronts or significantly up their digital game, even if they had a pharmacy eCommerce business before.

Established pharmacies like CVS and Walgreens saw a massive increase in online prescription orders in the early months of the pandemic. This prompted them to invest heavily in their digital infrastructure to facilitate easier prescription refills, deliveries, and telehealth services. We’ve also seen a massive rise of digital-first pharmacies, such as PocketPill, Pillway, and Medly.

Since then, consumer habits have only strengthened, initiating even higher eCommerce penetration in this segment. Giants like Amazon and Alibaba launched their own eCommerce pharmacies to cater to the increasing demand for digital health solutions. To avoid industry intermediaries, some pharmaceutical companies, like Pfizer and Eli Lilly, have also launched their own online pharmacies to sell their medicines directly to consumers. The move is part of a growing trend in the pharmaceutical industry for companies to focus on direct-to-consumer services.

At the same time, lack of transparency in drug pricing on certain markets has catalyzed the emergence of new types of digital pharmacies with cost-plus pricing models, such as Mark Cuban Cost Plus Drug Company and Express Scripts. By bypassing traditional intermediaries like PBMs and wholesalers, these companies are challenging the status quo and offering significant cost savings on a wide range of generic medications for consumers and healthcare providers.

All this indicates a significant shift in how pharmaceuticals are sold and distributed and emphasizes the importance and much needed necessity of transparency, accessibility, and affordability of drug pricing and industry.

And how have things been going on the other side of the digital counter? In the B2B space, digital commerce has also become the new norm long before the global health crisis and traditional supply chain disruptions.

Pharmaceutical companies, active ingredients and raw material suppliers, contract research and manufacturing organizations, distributors, pharmacies, clinics, HCPs (healthcare professionals), and other stakeholders in the supply chain are actively transitioning or already transitioned to more effective ways to shop and sell the products and services they need to operate.

This switch has also been accelerated by other factors, such as the growing need for a B2C-like shopping experience among B2B buyers, as well as the global trend towards niche B2B marketplaces. As a result, in recent years there has been a boost of online pharmaceutical B2B commerce initiatives integrated over every stage of the manufacturing process.

On the discovery stage pharmaceutical companies have been increasingly adopting life science research platforms, like Science Exchange or ZAGENO, to outsource their research activities to screened and verified contract research organizations (CROs), academic labs, and government facilities. Such marketplaces streamline R&D procurement by bringing suppliers of lab consumables, equipment, antibodies, cell cultures, molecules, and kits under one roof.

Some life science research vendors are launching their own eCommerce websites to streamline their product and service offerings in an omnichannel manner. For instance, in 2015 two companies, Eurofins Drug Discovery Services and life sciences products supplier Qiagen, launched their own eCommerce websites to meet the demands of their clients.

During the clinical development stage, pharmaceutical companies and research organizations rely on clinical trial marketplaces to connect with clinical research organizations, trial sites, and patient recruitment services.

One example is ClinEco, a web-based platform and community that connects all the stakeholders of decentralized, hybrid, and conventional clinical trials.

Another one is TriNetX which connects pharma and healthcare organizations with premier clinical research institutions for study design support, protocol feasibility, site selection, patient recruitment, and more.

During the manufacturing and scale-up phase, B2B niche marketplaces are gaining momentum too. Pharmaceutical companies use platforms like PharmaCompass and Pharmaoffer to shop for active pharmaceutical ingredients (APIs) and finished dosage forms (FDFs) necessary for drug formulation and production from trusted suppliers and Contract Manufacturing Organizations (CMOs). They also rely on such platforms for services like drug product development, packaging, registration, etc.

On the distribution side of things, there is a wide range of B2B eCommerce solutions that pharma companies, wholesalers, clinics, pharmacies, and other stakeholders use to streamline their sales and procurement operations.

For instance, after the pandemic, more drug manufacturers launched their own eCommerce platforms for direct sales to clinics, pharmacies, and healthcare providers, such as Pfizer Pro, and Sanofi Supplier Connect.

Another example is B2B marketplaces where multiple pharmaceutical companies or their distributors sell products to clinics, hospitals, pharmacies, and other HCPs, including Pipelinepharma, Pharmint, and others.

While this list of B2B digital pharmaceutical commerce solutions is by no means exhaustive, the variety of platforms at every stage of the drug development and manufacturing process indicates the significant role of eCommerce as one of the industry's key sales channels.

Any transition to a more streamlined and digitized workflow is not without its challenges, and the pharmaceutical industry is no exception. Due to the more complex nature of pharma products, their pricing, and regulatory compliance requirements, selling and buying pharmaceuticals (or anything that goes into their research, development, production, and distribution) is more complicated and nuanced than buying office supplies or OEM automotive parts.

If we can summarize the challenges that pharma companies and other market players can face in their eCommerce initiatives, based on our extensive expertise in developing complex B2B eCommerce solutions, we’d group them into four categories.

For one, due to the more complex nature of life science and healthcare products compared to everyday items, an eCommerce pharmaceutical platform would need more advanced tools and a more sophisticated user experience than a typical eCommerce platform would allow.

For instance, if you plan to launch a pharmaceutical research service marketplace, you would need to think through providing detailed product information beyond what’s available on the packaging. This includes ensuring consistency in nomenclature across different manufacturers to facilitate accurate comparisons.

If you’re setting up a pharmaceutical marketplace for pharmacies and HCPs, you also need to make sure that your platform can support multiple contract formats tailored for different customers and their unique purchase volume, delivery frequency, and other parameters.

Since drug pricing can vary a lot due to complex negotiations between manufacturers, PBMs, insurers, and HCPs, it’s important to lay down this complexity into your platform from the very beginning. This will allow your clients (manufacturers, wholesalers, etc.) to manage and customize pricing for their pharmaceutical products based on predefined parameters, such as sales channels, customer types, their insurance plans, etc.

Make sure to check if the eCommerce platform you’ll build your pharmaceutical solution on, supports this kind of pricing complexity and customization.

Given the sector’s highly regulated nature, digital pharmaceutical commerce solutions must also have robust security measures to ensure patient data privacy. These include encryption, secure data storage, and strong access controls to make sure they comply with stringent regulations, such as HIPAA and GDPR.

It’s worth checking with the eCommerce technology vendor what kind of approach they take when it comes to data security and privacy.

Finally, knowing how conservative the sector can be when it comes to digitalization, it’s essential to make sure that your pharmaceutical eCommerce platform can smoothly communicate with your existing systems and that’s of your customers, such as ERPs, CRMs, P2Ps, accounting, inventory management systems, and others. This will not only ensure data consistency but reduce manual steps across multiple platforms for all parties involved.

The current landscape of B2C and B2B pharmaceutical digital commerce initiatives clearly demonstrates the industry's ongoing shift toward digitization and automation. Both buyers and sellers are looking for more cost-effective and convenient solutions to speed and streamline their processes, whether it's finding a qualified supplier for timely AIM procurement or getting needed medications delivered quickly to their doorstep.

At the same time, we see a growing demand for transparency, accessibility, and affordability of medicines. eCommerce is part of the solution, enabling patients and HCPs to achieve significant savings by comparing drug prices from multiple suppliers, as well as through more streamlined supply chains or DTC models that cut out intermediaries that add to the cost of medicines.

Integrating an eCommerce platform into your pharmaceutical R&D, manufacturing or distribution workflow is not without its challenges. But with the right eCommerce architecture and technology, you can easily overcome them.

Headless, cloud-based, and API-first eCommerce platforms like Virto Commerce are built with the most complex enterprise commerce scenarios in mind. Its robust integration capabilities, advanced features, and focus on security and compliance make it an ideal choice for addressing the unique challenges of the pharma market. Learn more about our approach and our eCommerce solutions at Virto Commerce.