Pills for Pooches
Like other facets of the pet industry, the pet pharmacy space has mimicked its human counterpart, the human pharmacy space. More specifically, the pet pharmacy space is a large, dynamic and evolving industry.
Within the pet pharmacy space, changes are afoot. Veterinarians (“vets”) have historically distributed the vast majority of pet pharmaceuticals due to their strong relationships with pharmaceutical companies. Moreover, vets rely on pharmaceutical sales for approximately 30% of their revenue. Notwithstanding this dynamic, vets’ historical distribution domination is deteriorating as pet specialty, mass-market retailers and e-Commerce players gain market share. Consumers’ appetite for convenience (evidenced by the exponential growth of pet e-Commerce players such as Chewy.com, Pet360, Jet, 1800PetMeds and Amazon), coupled with growing trust in non-veterinary distribution, is driving this transition. While recent shifts to non-veterinary distribution channels have disproportionately targeted over-the-counter medications, analysts forecast strong prescription expansion into these channels in the coming years. In particular, with market share approaching 20% of the pet e-tail market, online pet pharmacies have capitalized on industry growth. A 2016 study commissioned by VetSource shows that consumers whose pet medications were home delivered were 140% more compliant with parasiticides and those same, more compliant customers purchased $212 more medication per year per patient and drove 93% more profit than their traditional brick & mortar retail-shopping peers. On the regulatory front, the National Association of Boards of Pharmacy (NABP) has bolstered consumer confidence in online veterinary pharmacies by holding U.S. pharmacies to rigorous consumer safety standards. Moreover, The Fairness to Pet Owners Act, currently under review by Congress, promises to catalyze unprecedented online pet pharmacy growth, if passed.
So the next time Rover has an upset tummy, get out your smart phone rather than your car keys.