The market for pharmacy automation is expected to grow at a CAGR of 10% during the forecast period of 2023 to 2030. The primary factors driving expansion in the market are an increasing emphasis on automating tasks in order to cut down on the cost of labor and an increase in the dispensing of specialty drugs. Additionally, organizations that specialize in pharmacy automation are looking for new business prospects by increasing their presence in emerging markets. However, the expansion of this industry may be hampered by the high costs associated with deploying pharmacy automation systems as well as by rigorous regulations that cause delays in product introductions. The retail pharmacy industry all over the world is undergoing significant transformation as a result of the introduction of pharmacy automation technologies, analytics, and software. Not only has the sector been more profitable as a result of automation, but it has also become significantly more efficient as a result of automation. Because of the automation, there has been a discernible reduction in the amount of medication that is thrown away; as a result, the cost of each dose has fallen. It has also made it easier for pharmacists to control workflow, allowing them to place a greater emphasis on the satisfaction of their customers. In recent years, there has been a meteoric rise in the annual expenditure on pharmaceuticals (prescription and over-the-counter treatments).
Increased Focus on Improvising Quality Care
Pharmacists in industrialized nations are putting into practice new ways that will improve the drug procedure in terms of both its safety and its effectiveness. It's possible that optimizing medicine distribution with the use of automated drug dispensing systems (ADS) could be beneficial in a variety of hospital departments, including intensive care units. Because the mundane tasks of compounding, dispensing, labeling, and packaging the pharmaceuticals are taken care of by automated equipment in pharmacies, pharmacists are now able to devote more of their time to providing high-quality care to individual patients. It is anticipated that growing competition between hospitals and retail pharmacies to deliver better care to patients will drive the revenue growth of the pharmacy automation systems market over the forecast period.
Because of recent developments in technology, pharmacists and nurses now have access to technologically advanced pharmacy automation systems. These systems are able to automate processes such as the dispensing of medications, the packaging and labeling of medications, the compounding of medications, the tracking of inventory, the storage and retrieval of inventory, and other processes. In addition, there have been developments that have boosted the efficacy of hospital and retail pharmacies, such as the connecting of electronic medical records with drug and dispensing cabinets as well as pharmacy robots. It is projected that interfacing with various software and rising levels of automation in pharmacies would drive revenue growth for the pharmacy automation systems market over the course of the research period.
Significant Role in Elimination of the Drug Errors
Errors in medication and inaccuracies in the way drugs are administered pose significant dangers to patients. These errors lead to the causation of deaths that may have been avoided in a hospital setting. According to the findings of the study, around 98,000 people lose their lives in hospitals due to preventable medical errors. This amount is greater than the total number of deaths that have been attributed to AIDS, breast cancer, and automobile accidents combined. Medication errors claim the lives of more persons on an annual basis than work-related injuries. As a direct result of this, the governments of various nations are increasing the use of automation in pharmaceutical tools in hospitals and pharmacies in an effort to reduce the number of drug-related errors. As a direct consequence of this, pharmacy automation systems are becoming increasingly widespread. During the process of preparing or dispensing drugs or administering drugs, some of the key factors that contribute to medication errors include poor order communication between physicians and pharmacists, dangerous storage practices in pharmacies, and confusion that arises from similar labels and drug prescriptions. Automated methods are widely regarded as among the most effective approaches to reducing the occurrence of these errors. The successful adoption of automated dispensing cabinets (ADCs) and automated dispensing machines (ADMs) in hospitals in the past led to considerable reductions in the number of errors that occurred during the process of distributing medications and dispensing them incorrectly.
Need for High Capital Investment Limits the Market Expansion
A number of professionals and providers in the healthcare industry are hesitant to adopt or accept IT-based approaches to pharmacy administration, despite the benefits that these techniques offer. This is especially clear when cultural barriers are present, especially in developing economies where the economy is still relatively young. As a consequence of this, many pharmacists do not want assistance and are hesitant to include pharmacy automation technologies into their normal dispensing routine. The widespread adoption of technology demonstrates that automated pharmacy systems offer significant benefits; however, up until recently, only large-volume pharmacies and hospitals were able to justify the returns on investment (ROI) obtained from installing these automated systems. Despite the fact that automated pharmacy systems offer significant benefits, the widespread adoption of technology continues to verify this.
Developing Nation to Present Immense Opportunities During the Forecast Period
It is anticipated that developing nations would become the driving force behind the expansion of the pharmacy automation industry. The percentage of elderly people living in developing countries is typically quite high. According to the UN report on World Population Ageing (2019), Eastern and Southeastern Asia are expected to experience a two-fold increase in the number of geriatric individuals. The population aged 65 years or over is projected to increase from 260.6 million in 2019 to nearly 572.5 million by 2050. This represents a significant increase from the current number of geriatric individuals, which is only 260.6 million. It is anticipated that this demographic shift would result in an increase in the number of patients in numerous Asian countries, which will in turn boost the demand for high-quality patient care and the effective distribution of medications. As a direct consequence of this, it is anticipated that the need for pharmacy automation systems would expand in a number of Asian nations over the course of the next few years.
Stringent Regulatory Norms to Challenge the Market Growth
The level of scrutiny that is applied throughout the regulatory clearance process is contingent on the category that a certain medical device falls into; in addition, the level of scrutiny can differ from one region to another. When it comes to the use of automated dispensing devices (ADDs) in healthcare settings, a number of state boards of pharmacies, which are state agencies responsible for the control and regulation of the practice of a pharmacy and the licensing of pharmacists in the state, have different requirements. Therefore, makers of automated systems for pharmacies are required to comply with a variety of standards; guaranteeing such compliance is a time-consuming operation that can cause delays in the launch of new products.
Automation Medication Dispensing Systems Dominated the Market in 2021
The Automation Medication Dispensing Systems segment dominated the market in 2021 by contributing over 25% of revenue and this trend is expected to continue during the forecast period of 2023 to 2030. The large share can be due to accuracy in dispensing pharmaceuticals and increased safety afforded by these systems, which result in fewer instances of patients receiving the incorrect medication after having it dispensed to them. It also helps in proficient inventory management, which helps cut costs, and it assists in controlling storage space, which also helps manage costs. Patients receiving incorrect prescriptions not only run the risk of having their health compromised, but it also has substantial financial repercussions for the healthcare provider. According to a research article by StatPearls, nearly 9,000 people lose their lives each year as a result of errors in the medication that they were prescribed, and the costs associated with medication errors in terms of patient management amount to more than 40 billion USD annually.
During the forecast period, it is anticipated that the automated pharmaceutical compounding systems market sector would exhibit the highest CAGR. This is owing to the fact that even with a precise hand compounding procedure, it is prone to errors, which can have significant effects on how the medications turn out. This is especially true when the medications are being made in large quantities. Because of this, the likelihood of errors occurring in the mixing of pharmaceuticals is diminished or eliminated entirely by using an automated compounding system. As a result of the fact that the procedure is carried out inside of an aseptic chamber, it not only eliminates the possibility of contamination but also eliminates the sources of contamination. The elements that have been discussed thus far are the primary drivers of the market.
Retail Pharmacy Segment Contributed to More than Half of the Revenues in 2021
The retail pharmacy sector accounted for the greatest proportion of the total market share in the end-use category of the global industry. In 2021, the segment was responsible for accounting for 52.5% of the revenue share. This can be attributed to the rise in the number of retail pharmacies that have opened up in different countries. Automating formerly manual processes in retail pharmacies is leading to a sea change in the amount of money saved across numerous fronts. The OECD library reports that the total number of pharmacies in all of the OECD enterprises has grown over the past few years. Due to intensified efforts on the part of the Japanese government, Japan maintained the world's highest population density from the years 2000 to 2019. 75% of pharmacists in Canada worked in community or retail pharmacies in 2019, while only 25% of them worked in healthcare settings. This statistic was based on data from 2018.
The hospital pharmacy sector has been characterized by the industry's most rapid expansion. This is because there is a greater emphasis on reducing the number of errors that occur during the distribution of medication in clinical and hospital settings. In addition, automation makes it possible to easily control the workflow, and it does it in a manner that is more effective than its human equivalents. Another benefit of managing the inventory for these hospital pharmacies is a decrease in the amount of unused medication that is thrown away. The rapid expansion of the market segment can be attributed to each of these contributing elements.
North America Clearly Dominating the Market, APAC Promising Significant Opportunities
In 2021, North America was the most dominant region that accounted for about 55% of the revenue contribution. Some of the most important factors contributing to the expansion of the region include the establishment of a highly developed healthcare system, significant developments in patient management, and the implementation of hospital management systems. The COVID-19 epidemic has been a major driver of growth in recent years, which has caused many vendors of technology to assert that pharmacy automation, in addition to the general adoption of technology, is the way of the future. In addition, the presence of big drugstore chains as well as high patient numbers has been a driving force behind the expansion of the regional market. The imperative to reduce both the amount of unused medication and overall expenditures have also been a driving force behind the expansion of this region. According to the Food and Drug Administration of the United States (FDA), each year in the United States there are still reported to be over 100,000 incidents of suspected pharmaceutical errors. In addition, a study that was conducted by Johns Hopkins University found that each year, the United States has more than 250,000 deaths as a direct result of mistakes that were made with drugs. As a consequence, it is regarded as one of the primary reasons for deaths across the nation. The majority of errors with medication take place at the prescription and distribution stages. Because they improve inventory stock management, drug traceability, and dispensing speed, automated medicine dispensing systems and cabinets are becoming increasingly popular in North America. This is due to the fact that they reduce the number of errors that occur during the dispensing process.
During the time covered by the forecast, it is anticipated that Asia-Pacific would have the highest CAGR. The increasing proportion of elderly people who require medication to treat persistent diseases is mostly responsible for this expansion. The requirement for a decrease in the costs of medications, the occurrence of pharmaceutical errors, and the effective management of workflow in hospital pharmacies and stand-alone units have all contributed to the expansion of the region. This region has been offering tremendous growth potential for the sector due to huge unmet demands in terms of modern healthcare systems and management systems. These needs have been a driving force behind the region's rapid population increase. According to the article that was released by Business Standard Private Ltd. in the month of May 2019, India consistently ranked higher than Singapore in terms of automation. The article states that 69% of Singaporeans and 76% of Indians are willing to try new technologies and ways of working in order to be more efficient or productive, respectively.
Market to Get Increasingly Fragmented with Emerging Players from Developing Nations
The market for pharmacy automation is moderately competitive and fragmented. Market participants are placing an emphasis on the ongoing development of new products while also providing items at prices that are competitive, particularly in developing countries. Dominant market participants are placing a strong emphasis on product development and innovation as a means to expand their brand recognition and increase their overall revenue. Mergers and acquisitions of smaller players by larger players, as well as strategic alliances between hospitals or pharmacies and software firms, are the primary strategies adopted by key market players. Key players in this market segment include Becton, Dickinson, and Company from the United States, Omnicell, Inc. from the United States, KUKA AG (Swisslog Healthcare) from Germany, Baxter International Inc. from the United States, Capsa Healthcare from the United States, Cerner Corporation from the United States, Yuyama Co., Ltd. from Japan, ARxIUM Inc. from the United States, Parata Systems, LLC from the United States, RxSafe from the United States, and ScriptPro LLC (US).
Historical & Forecast Period
This study report represents analysis of each segment from 2022 to 2032 considering 2023 as the base year. Compounded Annual Growth Rate (CAGR) for each of the respective segments estimated for the forecast period of 2024 to 2032.
The current report comprises of quantitative market estimations for each micro market for every geographical region and qualitative market analysis such as micro and macro environment analysis, market trends, competitive intelligence, segment analysis, porters five force model, top winning strategies, top investment markets, emerging trends and technological analysis, case studies, strategic conclusions and recommendations and other key market insights.
Research Methodology
The complete research study was conducted in three phases, namely: secondary research, primary research, and expert panel review. key data point that enables the estimation of Pharmacy Automation market are as follows:
Market forecast was performed through proprietary software that analyzes various qualitative and quantitative factors. Growth rate and CAGR were estimated through intensive secondary and primary research. Data triangulation across various data points provides accuracy across various analyzed market segments in the report. Application of both top down and bottom-up approach for validation of market estimation assures logical, methodical and mathematical consistency of the quantitative data.
| ATTRIBUTE | DETAILS |
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| Research Period | 2022-2032 |
| Base Year | 2023 |
| Forecast Period | 2024-2032 |
| Historical Year | 2022 |
| Unit | USD Million |
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End Use
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Region Segment (2022-2032; US$ Million)
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Key questions answered in this report
