U.S. Online Pharmacy Market - Industry Outlook & Forecast 2021-2026

U.S ONLINE PHARMACY INDUSTRY INSIGHTS

The U.S. online pharmacy market size was valued at USD 52 billion and is expected to reach USD 146 billion in 2026, growing at a CAGR of 19% during 2020-2026. The US e-pharmacy industry has gained momentum with the increasing use of e-prescription by hospitals and the high penetration of the internet and smartphones.

Automated prescription filling, automated customer relationship management, direct-to-the-patient sales of medicines are other major factors increasing the adoption of online pharmacies across the US. The market is shifting toward the direct-to-patient model as the ever-expanding digital world opens doors to new services and consumer-friendly online experiences. The ease and familiarity of online purchasing attract several patients to search for virtual care medications and wellness options. This has increased online pharmacies to advertise more and acquire more consumers through digital platforms. The COVID-19 pandemic has further accelerated this shift as most healthcare professionals and patients have adapted to the virtual way to purchase medicines. The trend expects to increase drastically across North America post-COVID-19.

SNIPPETS

• The prescription-based online pharmacy market will likely observe an incremental growth of over USD 85 billion by 2026.
• The high prevalence of chronic diseases such as diabetes, cancer, hypertension, and cardiovascular disorders is likely to aid the growth of the medication segment, growing at a CAGR of over 18% from 2020 to 2026.
• The online health wellness and nutrition pharmacy market is likely to grow at the highest CAGR of over 23% from 2020 to 2026 due to increased vitamins, minerals, and nutrients supplements among US consumers.
• The mobile application segment expects to reach over USD 107 billion by 2026 due to the high popularity of smartphones, especially among millennials.
• Independent online pharmacies are expected to grow at the fastest CAGR from 2020 to 2026 due to cost efficiency and reimbursement facilities.

U.S. ONLINE PHARMACY MARKET SEGMENTATION

This research report includes a detailed segmentation by

• Drug Type
• Product
• Modality
• Pharmacy Type

INSIGHTS BY DRUG TYPE 

The prescription-based US online pharmacy market is likely to cross USD 132 billion by 2026. A significant factor driving the growth of prescription-based medicines via online mode is cost-efficiency. Consumers prefer to purchase drugs from online stores as they offer medications at a low price than retail outlets. Among US adults prescription-taking medications, 1.5% reported having purchased medicines outside the US due to high costs. Hence, online pharmacies are seen as the best solution for providing prescription medications at discounted prices, thereby observing growth.

The OTC market accounted for the share of approx. 11% in the US pharmacy market. The usage of OTC medicines has been increasing over the years. According to the Consumer Healthcare Products Association, 81% of adults in the US use OTC medicines to treat several minor illnesses. OTC drugs are comparatively cheaper than prescription drugs. Over 25% of OTC sales currently occur online in the US. The demand for OTC medicines is increasing partially due to growing prescription drug costs. There is an increased number of new private labels that are likely to be introduced in the market.

INSIGHTS BY PRODUCT

In 2020, the medication segment accounted for approx. 76% in the U.S. online pharmacy market share. The increase in the patient population along with the increased geriatric population is increasing the demand for medications. There is an increase in consumers preferring online pharmacy platforms to purchase medicines due to high purchase convenience. Many customers and patients prefer using online pharmacies for refilling long-term medications.

The US online health wellness and nutrition segment expect to reach over USD 26 billion by 2026. Over the years, there has been a significant change in consumer behavior concerning health, wellness and nutrition products. Most US population aspiring to have a healthy lifestyle use fitness applications and are willing to pay a premium for health. In 2019, over 68 million smartphone owners in the US used at least one health or fitness application once per month. The COVID-19 pandemic further accelerates this trend. Pandemic has impacted the importance of good health and immunity to fight illness. Since the COVID-19 pandemic has affected the US considerably, consumers have increasingly turned toward vitamins, minerals, and nutrients supplement (VMS) products, expressing more significant interest in and engagement with the category.

INSIGHTS BY MODALITY

The mobile app-based segment will likely grow at a CAGR of over 19% from 2020 to 2026. Mobile applications play a significant role in the global online pharmacy market. They help online pharmacies to get in touch with consumers directly, thereby increasing the patient base. Mobile applications help online pharmacies to position their pharmacies effectively. Mobile applications providing refill prescription facilities, secure two-way messaging, HIPAA compliant mobile app will increase the customer base for online pharmacies. Vendors prioritize digital advertising and marketing to attract more audience as many patients spend their time online.

The US web-based pharmacy segment expects to reach USD 38 billion by 2026, growing at a CAGR of over 17% from 2020 to 2026. Web-based pharmacies were the first online channels for pharmacies. In the pre-mobile app era, web-based online pharmacies were used to order medicines. However, after the introduction of mobile app-based pharmacies, the demand for web-based pharmacies has reduced. There is a massive shift toward mobile app-based purchases from web-based pharmacies, thereby increasing market growth.

INSIGHTS BY PHARMACY TYPE

The U.S. epharmacy market by the online branch of brick and mortar expects to reach approx. USD 80 billion by 2026. Most retail companies in the US tend to own an online channel to promote their products and increase the customer base. This trend has been prevalent in the US for a long period. However, during the COVID-19 pandemic, the country further accelerated the adoption of online pharmacy channels.

The US independent online pharmacy market expects to reach over USD 49 billion by 2026. Independent online pharmacies have become one-stop solution providers for medical products across the US. They provide standard prescription fillings and offer several customer-friendly services, which increase their preference among customers. They offer products at high discounts as they have a unique supply chain, removing intermediaries and distributors and deliver products directly to customers. 

INSIGHTS BY VENDORS

The U.S. online pharmacy market is witnessing a steady flow of start-ups entering the industry. The COVID-19 pandemic has increased the importance of online pharmacies in the country. Many physicians, patients, and healthcare providers have increased the adoption of telehealth, which has increased the number of teleconsultations in the country. Large hospitals have received 500% more online consultations, and e-prescriptions among healthcare providers have also increased. These factors have accelerated the growth of the online pharmacy market in the US. A change in consumer behavior patterns has increased opportunities for market growth. However, strict adherence to regulatory guidelines and the prevalence of counterfeiting and fake websites selling unhealthy products are hindering the market. Kroger, CVS Health, CIGNA (Express Scripts), Walgreens Boots Alliance, and Rite Aid are the key players in the U.S. online pharmacy market.

The U.S. online pharmacy market research report includes in-depth coverage of the industry analysis, market dynamics with revenue and forecast insights for the following segments:

Drug Type

• Prescription
• OTC

Product

• Medications
• Health Wellness & Nutrition
• Personal Care & Essentials
• Others

Modality

• Mobile Applications
• Websites

Pharmacy Type

• Online Branch of Brick & Mortar
• Independent Online Only Pharmacies
• Partnership Sites with Neighborhood Pharmacies

Geography

• US