Get The Important Insights!
When wanting to sell OTC and Pharma products in Germany, there are some insights that your business strategy has to take into consideration.
The German Self-medication and Rx market very much follows the trope of German efficiency. This is probably best exemplified by the retail channels that are used to sell this measure of products in Germany, of which there are 5:
- Online Pharmacies
- Online Marketplaces.
Figure: Overview of the Pharmacy Sales Revenue 2020 in Germany
All 5 different avenues have different permissions to sell different drug types. For example, drugstores, supermarkets, and marketplaces are all able to sell some OTC drugs and supplements but cannot sell prescription drugs. Whereas the fact that all pharmacies are required to have an in-store pharmacist, means that they remain the only place where one can purchase all the different drug segments in person. Still, pharmacists represent a steady point of reference for German people. In fact, more than 83% of German citizens trust and have confidence in their pharmacist.
This, in conjunction with the German government’s implementation of its antitrust laws has created a very unique market system, as it is not possible to own any pharmacy chains. In addition to that, one pharmacist can not own more than 3 pharmacies in Germany.
Drugstores and Supermarkets
As such, drugstore franchises generate the most revenue in Germany–with the top 3 (Rossmann, dm-markt, and Müller) generating more than US$25 billion a year. Drugstores and supermarkets represent an important sales channel especially for “grab & go” products such as vitamins, food supplements, and natural based products.
On the other hand, with the development of online pharmacies and digital solutions, marketplaces such as Amazon are making their way into selling OTC products. Germany being one of the biggest OTC and pharma markets in the world, Amazon is implementing strategies to establish something similar to Amazon pharmacy in the US, even with Germany’s stricter regulations on selling medicinal products.
Online pharmacies experienced a pivotal growth due to recent events, with an increase of 38% in sales, representing approximately 1.6 million new customers.
ABDA, the German Association of Pharmacists, confirmed a shift in the business trend towards the internet, sharing that the mail-order of OTC and non-pharmacy bound products now have 35% of the market share (May 2022).
Many traditional pharmacies are now opening their own e-commerce websites, following the trend and contributing to the market’s growing size. However, the Rx online sales only have a 1,5% share. This will change after e-prescriptions come into place by the end of 2022.
Entering the intricate German market may be a challenge for any OTC and pharma company, but Chameleon Pharma Consulting Group has years of expertise to help you enter some of the channels mentionned above!