Retail Pharmacy in Brazil Customer Challenges and Pains Analysis¶
Challenges and Pains faced by Customers¶
Based on the analysis of the Brazilian retail pharmacy value chain, several challenges and pains faced by the final customers, primarily the B2C end consumers, can be identified. These challenges often stem from bottlenecks and complexities present at various stages of the value chain – Manufacturing, Distribution, and Retail – as well as overarching factors like regulation and the economy.
One of the significant pains for customers is the difficulty in affording medications and other pharmacy products. This is influenced by several factors within the value chain, including the high cost of production (Manufacturing), logistics and distribution costs (Distribution), operational costs at the retail level (Retail), and significantly, the complex and high tax burden on products throughout the chain. [Value Chain Analysis] Economic instability also directly impacts consumers' purchasing power, making affordability a key challenge. [Value Chain Analysis] While price controls (CMED) exist to limit maximum prices, the underlying cost structure and economic conditions contribute to this pain point. [Value Chain Analysis]
Customers also face the pain of products not being available when needed, or delays in receiving deliveries. This is largely due to logistical hurdles inherent in Brazil's vast territory and infrastructure limitations, which affect the efficiency of product movement from Distribution to Retail. [Value Chain Analysis] Challenges in inventory management at both the distribution and retail levels can also lead to stockouts. [Value Chain Analysis] For customers relying on e-commerce and delivery services, logistical complexities translate directly into delivery delays or higher associated costs. [Value Chain Analysis]
Another pain point, particularly for customers purchasing temperature-sensitive medications like vaccines or certain biologicals, is a potential lack of confidence in product integrity. While the value chain has processes for cold chain management, the complexity of maintaining strict temperature controls during storage and transportation across Brazil's varying climates and long distances presents a challenge. [Value Chain Analysis] Any failure in this process can compromise product efficacy and safety for the end consumer.
As retail pharmacies evolve to offer more health services, a pain point for customers is the difficulty accessing a consistent range of these services (such as vaccination, basic tests, or enhanced pharmaceutical care). This is linked to operational challenges in the Retail segment, including ensuring the availability and adequate training of pharmacists for these expanded roles, as well as the investment and regulatory navigation required to offer such services effectively across all pharmacy locations, particularly impacting smaller or independent pharmacies. [Value Chain Analysis]
Furthermore, customers face a challenge regarding the responsible disposal of expired or unused medications. Implementing effective reverse logistics systems for collecting and disposing of these products safely and conveniently across the country is a bottleneck involving coordination between consumers, pharmacies, distributors, and waste management. [Value Chain Analysis] This leaves many customers unsure or unable to dispose of medications properly, posing potential environmental and health risks.
Customers may also experience inconsistent or insufficient pharmaceutical counseling. While pharmacists are legally required and play a crucial role, operational pressures in busy retail environments and potential gaps in training for providing comprehensive clinical counseling can impact the quality and depth of advice received by the consumer. [Value Chain Analysis]
Finally, though perhaps less frequently perceived by every customer, the delayed access to new and innovative medications is a pain point impacting patients with specific conditions. This delay is primarily caused by the complex and lengthy drug registration and approval processes managed by the regulatory body, ANVISA, at the Manufacturing stage. [Value Chain Analysis]
Prioritized table of challenges and pains:
| Priority | Customer Pain Point | Underlying Value Chain Challenge/Bottleneck | Impacted Value Chain Stage(s) |
|---|---|---|---|
| High | Difficulty Affording Medications/Products | High Tax Burden, Economic Instability, Production/Distribution/Retail Costs, Price Control System (Indirect) | All Stages, Cross-Chain |
| High | Products Not Available When Needed / Delays in Delivery | Logistical Hurdles (Transportation, Infrastructure), Inventory Management Challenges, Competition | Distribution, Retail, Cross-Chain |
| Medium | Difficulty Accessing Health Services in Pharmacies | Operational Challenges in Retail (Pharmacist Role/Training, Service Integration, Investment, Regulation) | Retail |
| Medium | Lack of Confidence in Product Integrity (Cold Chain) | Logistical Hurdles (Cold Chain Management Requirements), Quality Control | Distribution, Manufacturing |
| Medium | Difficulty Disposing of Expired Medications | Reverse Logistics Implementation Challenges | Retail, Distribution, Cross-Chain |
| Medium | Inconsistent/Insufficient Pharmaceutical Counseling | Operational Challenges in Retail (Pharmacist Role/Training, Time Constraints) | Retail |
| Low | Delayed Access to New Medications to Market | Regulatory Burden (ANVISA approval process) | Manufacturing, Cross-Chain |
Correlation with Value Chain¶
The challenges and pains identified for the final customers in the Brazilian retail pharmacy sector are directly correlated with bottlenecks and complexities across the value chain stages: Manufacturing, Distribution, and Retail, as well as cross-cutting factors.
The pain of Difficulty Affording Medications/Products is intrinsically linked to the cost structure built throughout the value chain. Manufacturing costs, distribution logistics and associated fees, and the operational expenses of retail pharmacies all contribute to the final price. [Value Chain Analysis] The significant tax burden applied at multiple points in the chain is a major contributor to higher costs passed on to the consumer. [Value Chain Analysis] Furthermore, the macroeconomic environment and consumer purchasing power are external factors directly impacting affordability. [Value Chain Analysis]
Products Not Available When Needed / Delays in Delivery primarily highlight issues in the Distribution and Retail stages, exacerbated by Brazil's challenging logistics. The ability of distributors to efficiently move goods from warehouses to over 93 thousand pharmacies nationwide is critical, and limitations in infrastructure or transportation directly cause delays and impact product availability on shelves or for delivery. [Value Chain Analysis, InovaFarma] Retail pharmacies' own inventory management practices also play a role in ensuring products are in stock. [Value Chain Analysis]
The potential Lack of Confidence in Product Integrity, especially for temperature-sensitive items, points directly to the critical need for robust processes in the Distribution stage, particularly cold chain management, but also quality control originating in Manufacturing. [Value Chain Analysis] Any weakness in warehousing or transportation conditions can directly harm the end product the customer receives.
The Difficulty Accessing Health Services in Pharmacies and Inconsistent/Insufficient Pharmaceutical Counseling are direct reflections of operational challenges and the evolving role of pharmacists within the Retail segment. [Value Chain Analysis] The push to transform pharmacies into health hubs requires significant changes at the retail level, including investment in training, facilities, and integrating these services into existing workflows, which is not yet uniformly achieved across all pharmacy types (chains vs. independents). [Value Chain Analysis]
The pain point of Difficulty Disposing of Expired Medications correlates with the nascent state of comprehensive Reverse Logistics implementation across the value chain. While regulations exist, the practical infrastructure and coordinated processes for consumers to return medications and for these to be safely collected, transported, and disposed of are still developing and represent a significant challenge. [Value Chain Analysis]
Finally, the Delayed Access to New Medications is a direct consequence of the Regulatory Burden imposed by ANVISA during the drug registration process, which occurs at the Manufacturing stage before products can enter the distribution and retail channels. [Value Chain Analysis]
In summary, the customer pains are not isolated issues but are symptoms of various operational, logistical, regulatory, and economic bottlenecks that manifest at different points and interactions within the Brazilian retail pharmacy value chain. Addressing these underlying challenges at the manufacturing, distribution, and retail levels is essential to improving the experience and well-being of the final customer.
References¶
Abradilan. Crescimento das grandes redes de farmácias. https://abradilan.com.br/crescimento-das-grandes-redes-de-farmacias/ Abradilan. Farmácias destacam-se entre 120 maiores varejistas do Brasil. https://abradilan.com.br/farmacias-destacam-se-entre-120-maiores-varejistas-do-brasil/ Abradilan. Brasil tem 18 indústrias farmacêutica bilionárias. https://abradilan.com.br/brasil-tem-18-industrias-farmaceutica-bilionarias/ Abradilan. Das 20 maiores farmacêuticas do Brasil, 17 são nacionais. https://abradilan.com.br/das-20-maiores-farmaceuticas-do-brasil-17-so-nacionais/ Abradilan. Dez maiores farmacêuticas do Brasil detêm 48,6% das vendas. https://abradilan.com.br/dez-maiores-farmaceuticas-do-brasil-detem-486-das-vendas/ E-Commerce Brasil. Varejo farmacêutico brasileiro soma R$ 158,4 bi em 2024. https://web.archive.org/web/20240523095902/https://ecommercebrasil.com.br/noticias/varejo-farmaceutico-brasileiro-soma-r-158-4-bi-em-2024 Estadão RI. Principais redes de farmácias faturaram R$ 91,3 bi em 2023. https://web.archive.org/web/20240509012914/https://conteudo.estadao.com.br/system/public/estadaori/2024/04/29/principais-redes-de-farmacias-faturaram-r-913-bi-em-2023.html Giro News. Redes de farmácias faturaram R$ 91,3 bilhões em 2023; RD segue no topo do ranking. https://web.archive.org/web/20240520122416/https://gironews.com/farma-cosmeticos/redes-de-farmacias-faturaram-r-913-bilhoes-em-2023-rd-segue-no-topo-do-ranking/ InovaFarma. Confira os números atualizados do mercado de varejo farmacêutico no Brasil. https://web.archive.org/web/20240523095025/https://onovovarejo.com.br/inovafarma-numeros-atualizados-mercado-varejo-farmaceutico-brasil/ Investe SP. Brasil soma 47% do mercado farmacêutico na América Latina. https://web.archive.org/web/20240517191733/https://www.investe.sp.gov.br/noticia/brasil-soma-47-do-mercado-farmaceutico-na-america-latina Novo Varejo. Conheça as 5 maiores redes de farmácia do Brasil. https://web.archive.org/web/20240523100517/https://onovovarejo.com.br/5-maiores-redes-de-farmacia-brasil/ Panorama Farmacêutico. Ranking das grandes redes de farmácias da Abrafarma. https://web.archive.org/web/20240523094400/https://panoramafarmaceutico.com.br/ranking-grandes-redes-farmacias-abrafarma-2024/ Panorama Farmacêutico. Redes de farmácias mantêm projetos de expansão para 2024. https://web.archive.org/web/20240523095253/https://panoramafarmaceutico.com.br/redes-de-farmacias-mantem-projetos-de-expansao-para-2024/ Panorama Farmacêutico. Ranking das redes de farmácias mostra consolidação do setor. https://web.archive.org/web/20240523095536/https://panoramafarmaceutico.com.br/ranking-redes-de-farmacias-mostra-consolidação-do-setor/ Pague Menos tem receita bruta de R$3,1 bi no 1T24. https://web.archive.org/web/20240523100844/https://agenciabrasil.ebc.com.br/economia/noticia/2024-05/pague-menos-tem-receita-bruta-de-r31-bi-no-1t24