Drugs controller general of India (DCGI) has directed all states and Union territories to prohibit the sale of medicines through unlicensed online platforms to draft rules to regulate E-pharmacies are finalized and put in place.


  • Pharmacy is the science and technique of preparing, using, and review of drugs. Pharmacists, therefore, are the experts on drug therapy and are the primary health professionals. 
  • The Indian pharmacy market is huge and, as of 2017, is the third-largest in terms of volume and 13th largest in terms of value, globally. However, the e-pharmacy market is estimated to be a fraction of that. There are more than 200 E-pharmacy start-ups in India.

Retail Pharma Market: The retail pharma market in India is currently at a promising stage with its three broad segments of generic drugs, over-the-counter (OTC) drugs, and patented products. Generic drugs form the largest segment, with around 70% market share in terms of revenue.

How are e-pharmacies different? 

  • E-pharmacies receive request for prescription and non-prescription medicines. 
  • These platforms then forward the orders to a licensed pharmacy in their network that is registered with the government authorities. They deliver the order to the customer through a courier. 
  • Some e-pharmacies also stock medicines and thus dispense directly. 

Retail Pharmacy vs. E-Pharmacy Chains: The E-Pharmacy model presents various advantages over the traditional retail pharmacy model. 


Existing E-Pharmacy Models

  • Inventory-based Model of E-Pharmacy: In this model, the e-Pharmacy owns the inventory of medicines/drugs that are stored in warehouses/fulfillment centers across geographic locations. 
  • Marketplace-based Model of E-Pharmacy: In this model, the e-Pharmacy plays the role of an aggregator. It provides a technology platform that connects buyers and sellers of medicines. 
  • Generic eCommerce Marketplace: Generic eCommerce marketplace is a technology-driven electronic platform where a wide variety of products like electronics, fashion, furniture, home furnishings, and cosmetics are sold. 

Portal for Appointments for Doctor Consultation: The pharmacies have tied up with hospitals, stand-alone clinics and individual consultants for appointments. The consumers can make appointments for their doctor consultation from the e-pharmacy website. 

Recent issues

  • Delhi High Court recently banned the online sale of medicines. The Delhi HC said that the Drugs and Cosmetics Act, 1940 and The Pharmacy Act, 1948 prohibited the online sale of medicines. 
  • It was observed that lakhs of medicines are sold online, often without prescription even though the Drug Controller General of India had clearly ordered state drug controllers in 2015 to restrain such online sales in view of public health and safety. 
  • However, e-pharmacies continued to sell online, after securing a stay from the Madras high court.

Govt. regulations for E-pharmacy

  • Currently, E-Pharmacies in India adheres to the Drug and Cosmetics Act 1940, Drugs and Cosmetic Rules 1945, Pharmacy Act 1948 and the Indian Medical Act 1956
  • Online pharmacies are required to register with the Central Drugs Standard Control Organisation (CDSCO), the country's apex drug regulator and central licensing authority, from whom they can obtain a trade license.  
  • However, online sales of the prescription based medicines from the E-Pharmacy’s website are defined under the Information Technology Act, 2000. 

Government  Draft Rules on e-pharmacy: The Union Health Ministry recently notified a draft amendment to the Drugs and Cosmetics Rules, 1945 by inserting a component “Sale of Drugs by E-Pharmacy” (Part VI-B) to legalize the e-pharmacies in India.

  • The draft rules on "sale of drugs by e-pharmacy" state that "Any person who intends to conduct the business of e-pharmacy shall apply for the grant of registration to the Central Licensing Authority.
  • The details of the patient shall be kept confidential and shall not be disclosed to any person other than the central government or the state government concerned, as the case may be. 
  • The supply of any drug shall be made against a cash or credit memo generated through the e-pharmacy portal and such memos shall be maintained by the e-pharmacy registration holder as a record.
  • Sale of tranquilizers, psychotropic drugs, narcotics and habit forming drugs have been prohibited through these portals. Psychotropic drugs are medications that affect your central nervous system.
  • Advertisement of drugs is prohibited on any media for any purpose by an e-pharmacy.
  • E-pharmacies have to comply with the provisions of the Information Technology Act, 2000 (IT Act) and Rules.

Factors contributing to the growth of the e-Pharmacy Industry in India



  • There’s ambiguity on who can sell and who can’t:  Offline retailers say existing laws bar e-pharmacies from selling drugs. Online retailers say they are operating through licensed retailers and are hence not barred. 
    • The draft rules allow only government-registered e-portals to sell drugs; they must retain the prescriptions and verify patients’ and doctors’ details.
  • Fake and Illegal Sites: What if fake pharmacies spring up?
  • Medication Errors:  Wrong medication can be shipped.
  • Substitution: What if the vendor does not have the same brand as on prescription? There are no clear cut solutions
  • Pharmacovigilance: Drugs can be recalled after dispensing in retail pharmacy but difficult in e-pharmacy.

Why ban e-pharmacy?

Benefits of e-pharmacy

There are no clear guidelines regarding e-pharmacy, in the Drugs and Cosmetics Act, 1940. So regulating and monitoring is difficult.

Increased Convenience

Consumers would be able to order medicines in a convenient manner from their mobile phones or computers. This will significantly help patients who are old and sick and not in a condition to go out to find a pharmacy. 

Self-medication and antibiotic resistance:  Using medicines without consulting the doctor. This can cause antibiotic resistance and the spread of superbugs.

Improved Accessibility

With the use of technology and access to an inventory of multiple stores at a time, e-Pharmacies can aggregate supplies, making otherwise-hard-to-find medicines available to consumers across the

country.  Further, e-pharmacies enable access to rural areas where there is a limited presence of retail pharmacy. 

Illegal sites are selling counterfeit drugs.

Authenticity:  All medicine purchases are stored digitally, making it easy to track the supply chain, thereby decreasing the risk of counterfeit medicines, drug abuse, and self-medication.

Lopsided competition: Heavy discounts offered by e-pharmacies are eating into the profits of retail sellers. 

Improved Patient Compliance and Education

e-Pharmacies may provide value-added information to consumers, such as drug interactions, side effects, medicine reminders, and information on cheaper substitutes. 

Online transactions are prone to hacking/phishing. So a patient’s privacy is on the line.

Cost Advantage: e-Pharmacies enable pharmacy entrepreneurs to broaden their customer base while reducing

working capital, overhead costs, and increasing margins, which translates into a cost advantage for end consumers.

It can lead to drug abuse.

Tracking of Data 

All transactions could be efficiently tracked with complete details of the medicines, batch number, dispensing pharmacy name and address, prescribing doctor, name and address of the patient, etc., thereby reducing the problem of drug abuse and self-medication.

The retail pharma industry body also claims loss of jobs.

Documentation and Tax compliance 

Orders are 100% documented with records of the prescriptions. Every order dispensed through ePharmacy has a valid bill and tax to the Government is paid in full. 


Way forward: A competition watchdog is needed to ensure a fair competition between online p-pharmacists and retail pharmacists. 

  • Innovation: The model is in sync with the global models, thus spurring innovation in the industry. Govt. should encourage R&D in this area.
  • Additional Business Opportunity for Brick-and-Mortar Pharmacies: An e-Pharmacy model will enable existing pharmacies to enlist their products on the e-portal and serve a broader set of customers, or a network of pharmacies integrating to one platform and accessing a broader customer base across geographic locations.
  • Implementation of various Government initiatives: The operating model of e-Pharmacy that has been envisaged will have a mobile and a web-based application, directly linked to the inventory at existing Jan Aushadhi stores, which would help consumers procure their medicines
  • A separate license and registry of e-Pharmacy players should be created. 
  • The dispensation of scheduled drugs should be against a valid prescription from a Registered Medical Practitioner (“Prescription Drugs”) and must be undertaken by, or under the direction and supervision of a registered pharmacist 
  • An audit trail (including the address and name of the patient) should be digitally stored to prevent abuse and ensure tracking in case there is any adverse event to a medicine 
  • Narcotic medicines (like morphine) and other habit-forming drugs (like sleeping pills) should be restricted to be sold through an e-Pharmacy model. 
  • Suitable arrangements must be made to ensure that the medicines are packed, transported, and delivered in such a way that their integrity, quality, and effectiveness are preserved. 
  • The website/mobile application must clearly provide information regarding the logo, license number, and contact details of pharmacists for addressing patients’ queries and grievances. 
  • New optimization strategy leveraging big data and machine learning algorithms to automate operations, supply chain and address business challenges will be the area that will impact long term sustainability of pharmacy initiatives. 
  • Integrating the value chain of demography, disease, diagnostics, doctors consultation and delivery of Drugs would be a key-value differentiator and will create niche players able to lead a PAN India operations. 

Since e-Pharmacy is only technology advancement, it is recommended that it should be allowed and its benefits should be made available to the consumers in India but with sufficient safeguards and under stringent regulatory control to protect the interest of the consumers.

Global best practices

  • Developed foreign countries like the USA, Canada, Australia, and European countries have legal internet-based regulatory bodies like NABP (National Association of Boards of Pharmacy) which are defined by a government verified internet pharmacy sites like VIPPS. 
  • These E-Pharmacy websites can be distinguished whether fake or real by the hyperlink seal which is displayed on the home page of the E-Pharmacy website.
  • Indian Government should also frame these sorts of regulatory framework through which real and fake E-Pharmacies in India can be distinguished.
  • The global e-Pharmacy market is currently led by North America and Europe. However, the major opportunity lies in addressing the vast unmet needs of the developing Asia Pacific

Also read: Framework of e-pharmacies

Drug Abuse