How The Changing Regulatory Landscape Will Shape The Future Of E-Pharmacy Startups

The delivery of pharmacy services online has come under great scrutiny in the recent past, with the DCGI issuing a show cause notice to leading players as to why action should not be taken against them. This development has come after multiple representations sent out to the DCGI and MOHFW by various trader organisations. 

The question that arises is whether there are provisions in the law for the online delivery of pharmacy services to exist and how the law can be formulated for better regulation.

The legislation governing the sale of medicines and drugs in India comes within the scope of the Drugs and Cosmetics Act 1940, the Drugs and Cosmetic Rules 1945, the Pharmacist Act 1948, and the Indian Medical Act 1956. With the law being set in a precolonial context, it neither authorises nor blocks the online sale of medicines in India. However, the electronic sale of physician-prescribed drugs from online drug store sites is expressed under the IT Act 2000. Indian policy must avoid one Foreign Trade Policy-like situation which was last released in 2014. 

E-Pharmacy: Legally Tenable & Unlocking Growth Opportunities

E-pharmacies have evolved with the growth and development of online retail fuelled by ecommerce. Ecommerce has made the idea of a digital buying experience mainstream which has led to the development of different and newer avenues like food delivery platforms, service aggregators, and cab aggregators, among others. Hence, the idea of online sale and purchase of medicines is not only legally tenable but also can spur opportunities for licensed pharmacists. 

There have been instances in the past where the law has evolved to make way for new sectors so that while people are safeguarded, innovation is not repressed. Just like how the Food Safety and Standards 2018 Rules, allowed for the existence of food delivery and aggregator platforms to exist. This not only helped the F&B industry but also provided a huge employment opportunity for gig workers. The consumer has been a happy beneficiary of such innovations and policy support with increased access and easy delivery. 

Leveraging ‘Digital India’

The mobile-first growth of internet in India has created a digitally enabled population which has embraced digital payments, online retail, services, online logistics etc. This has been a culmination of Digital India and the efforts by the government across all its three pillars of the Creation of Digital Infrastructure, Delivering Services Digitally and Digital Literacy. Digital health vision is a key pillar of Digital India, so e-healthcare forms a critical aspect of the vision of Digital India.  

The need for e-healthcare was highlighted during the pandemic when online pharmacy services and teleconsultation were able to help patients, especially the elderly, with getting medicines and basic consultations at home. This also enabled a lot of smaller chemists and pharmacists during the pandemic to expand their markets and services. 

Regulation Needed For Increased Accountability

Now that the restrictions of the pandemic have been lifted, the need to evolve a framework which enables online pharmacies is important given that the country is becoming more and more digitally inclined. E-pharmacies working as marketplaces can be governed in the same manner as food aggregators, who provide only for the listing of food products and are not required to obtain a separate food license under the existing legislation.

An online pharmacy regulation could also help with better enforcement of the laws that already exist. Only valid prescriptions as per the Drugs & Cosmetic Act will be accepted for order processing. All prescriptions will be stamped when dispensed, preventing the re-use of the same prescription. The health data of the patients stored in secured servers makes it convenient and time-saving to fill and refill prescriptions. 

E-pharmacies would also make it easier to keep a track of medication history and increase the traceability of inventory thus enhancing the regulation of Schedule H and X drugs. Online pharmacies also increase access to medication and make it easier to find rare medicines that are not available in traditional stores. Online pharmacy services also help keep in check the counterfeit operations making the entire supply chain from manufacturer to delivery easily trackable.

E-pharmacies go hand in hand with the Pradhan Mantri Bhartiya Janaushadhi Pariyojana making affordable medicines more accessible. So, while a lot of offline players might feel that the advent of online pharmacy business could hamper their business, online pharmacy services will not only help small chemists discover newer markets but also provide consumers with easy access to better healthcare.

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