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If Zigy, the online pharmacy started by former Infosys senior executive and iGate CEO Phaneesh Murthy, were a person, the place where it died sometime towards the end of 2016 would now be a memorial.

A memorial dedicated to a fearless, though some would say foolhardy, pioneer that decided to run guns blazing into the thicket that was India’s pharmacy sector. In just over a year, it fearlessly took on the powerful offline lobby and outdated government regulations and expanded into five major Indian cities. And it almost made it.

Because what brought Zigy down, in the end, weren’t bullets from its foes, which it had many, but running out of money. Even after reportedly raising over $5 million.

If Zigy were a person, it’s tombstone would today read:

“Here lies Zigy. Ambitious, brave, foolish.

Because in losing its battle, it won us the war.

R.I.P. 2015-2016.”

The ‘us’ here are online pharmacies, led by Zigy’s former competitors like 1mg and Netmeds. And the ‘war’ they won was when on 16 March, the union ministry of health put out a public notice to announce its stance on the sale of drugs—both offline and online. Over the next thirty days, the ministry’s inbox was flooded with mostly congratulatory emails, some apprehensive and one angry, said a ministry official in confidence. And it is now busy formulating a policy incorporating the feedback, but its intention is clear—e-pharmacies have every right to sell drugs. And they’re here to stay.

The war Zigy won for e-pharmacies by losing its own battle for survival.

The hunted become friends

Like ride sharing, e-commerce, Internet telephony and numerous other Internet-enabled businesses in India, e-pharmacies, too, came up before government policy created the space for them. Many came up around the 2014-2015 period. And they started growing, some slowly, some fast. Till they appeared as threats on the radar of their powerful foes—the hundreds of thousands of small, offline pharmacies they were hoping to disrupt. Having seen sector after sector collapse to the onslaught of e-commerce, offline pharmacies were in no mood to roll over. Using threats of shutdowns and lobbying, they went for the e-pharmacies’ jugulars. The $13.4 billion market for drug sales was theirs alone.

On their spurring, and aided by ancient laws drafted in the 1940s, drug regulators in multiple big states then started going after online pharmacies. Maharashtra’s Food and Drug Administration filed FIRs against several e-pharmacies, including MeraPharmacy, mChemist, Pharmeasy and their offline partners. Similarly, in Karnataka, the Drugs Control Department decided to cancel the licences of all online pharmacies in the state early last year.


Ruhi Kandhari

Ruhi writes on the impact of healthcare policies, trends in the healthcare sector and developments on the implementation of Electronic Health Records in India. She has an M. Sc. in Development Studies from the London School of Economics.

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