The U.S. pharmacy market size was $534.21 billion in 2020 and is now projected to grow from $560 billion in 2021 to $861.67 billion by 2028 at a compound annual growth rate of 6.3% in the 2021 to 2028 period, according to global market research company Fortune Business Insights.
The impact of the COVID-19 pandemic was unprecedented in this category, making for staggering growth rates in pharmacy over the past several years. But even now, as the U.S. is getting back to pre-pandemic levels, market demands in pharmacy still remain strong.
The reason pharmacy still remains strong? According to the report, it’s a combination of factors, including an increase in diseases in the U.S., an aging population, as well as growing healthcare expenses.
Growth in prescription drugs, as well as inpatient and outpatient services in the U.S. are also leading to an increased number of prescriptions being filled by retail pharmacies.
Subsequently, more prescriptions also mean an increase in distribution, and therefore a demand for pharmacy locations. For instance:
- In 2020, physicians’ offices prescribed around 860 million drugs, and hospital emergency departments prescribed about 336 million
- In 2019, an estimated 3.79 billion prescription drugs were billed or dispensed in the U.S.
- The number of independent pharmacies increased 12.9% from 2020-2019
Retail pharmacies that are leading the geographical expansion of physical stores and pharmacies include CVS and Walgreens, improving accessibility for consumers.
Ecommerce companies like Amazon are also making an entrance into the pharma segment, keeping in line with consumers’ continuing shift to digital for goods and services.
Many patients were also forced to stay indoors during the pandemic, resulting in an increased comfort level around receiving treatment and medications at home. Because of this, CVS Health Corporation experienced a 5.3% increase in revenue in the retail business segment in 2020, for example.
Along the same lines, Amazon introduced two new pharmacy offerings in November 2020, helping to transform healthcare into a more digital system.
