e-commerce – more than just online retailing

Online retailing seems to get all the attention in today’s press but another online revolution is occurring and it’s in the business-to-business (B2B) space. This rather quiet movement is going on in all industries but for the healthcare industry the potential could have an amazing impact for not only businesses but also for consumers.

Changes are underway in the healthcare industry – tightening regulatory environment, expiration of blockbuster drug patents, expanding insurance coverage and more – are resulting in needs to adapt supply chains to compete in this new environment.

However, this new environment has also encouraged the growth of new alternative ways of doing business. In particular, the need to streamline procurement processes is great. This is especially true as reimbursement dollars decline for hospitals and other such facilities. Also, the mail-order prescription drug market is getting a new look thanks to a start-up company – guaranteed shipments and refills every two weeks versus the typical 90 day period – a much simpler model.

Pharmly, for example, is an online marketplace in which medical facilities can source drugs directly from the wholesale market. Purchasers submit bid requests to verified vendors who then submit an offer back to the purchaser to accept or reject. This process not only helps save on the cost of drugs and speeds up the ordering process but it also shortens the supply chain.

Another online company, MedPassage, focuses on the implantable medical device market. It basically removes the sales and marketing aspect as it offers collaborative online tools for product training, educational webinars and support while at the same time sells these medical devices directly to hospitals and other healthcare facilities. According to the company, as of June 2013, it had 6% of all US surgery centres on contract.

Finally, PillPack, an online, fully-licensed pharmacy, ready to take on the likes of retail pharmacies Walgreens and CVS. Currently available in 31 states, PillPack ships medications to customers every two weeks in a recyclable roll of individual dose packets that are organised by time and date. On-time delivery is guaranteed. The pharmacy accepts most prescription insurance plans and charges a monthly $20.00 fee plus co-pays.

As healthcare companies and manufacturers work to reduce supply chains costs, online start-ups are “thinking outside the box” and coming up with unique solutions to simplify the healthcare supply chain even further. More creative thinking is likely for the healthcare industry – either via completely new solutions or adapting solutions found in existing e-commerce models such as Shipwire’s cloud-based order fulfilment solution.