Pharmacy Automation Market Size, Share & Trends Analysis Report By Product (Automated Medication Dispensing Systems, Automated Packaging and Labeling Systems, Automated Table-top Counters, Automated Storage and Retrieval Systems, Other Products), By Pharmacy Type (Independent, Chain, Federal), By End User (Inpatient Pharmacies, Outpatient Pharmacies, Retail Pharmacies, Pharmacy Benefit Management Organizations and Mail-Order Pharmacies) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global pharmacy automation market size was worth USD 5.11 billion in 2022, and it is estimated to reach an expected value of USD 10.22 billion by 2031, registering a CAGR of 8% during the forecast period (2022-2031). Factors such as increasing need for specialty drug prescription filling solutions and Rising Need to Minimize Medication Errors, significantly drives the pharmacy automation market demand by 2031.

Pharmacy automation includes centralized or decentralized automated dispensing, packing, labeling, and other systems that decrease dispensing errors and enhance hospital nursing staff and pharmacies' workflow efficiency. The expanding need to reduce medication errors, the rising demand for specialty drug prescription filling solutions, and the decentralization of pharmacies are all significant drivers of market expansion. 

Market Dynamics

Global Pharmacy Automation Market Drivers

Increasing Need for Specialty Drug Prescription Filling Solutions

Specialty drugs are high-cost medications that treat complex, chronic, rare diseases like rheumatoid arthritis, cancer, and multiple sclerosis. These specialty drugs provide necessary cures and treatments, with new therapies coming up soon. These drugs require special handling, appropriate clinical outcomes monitoring, and adequate cost controls.

There is a rise in the global prevalence of various cancers, cardiovascular diseases, and immunological disorders, which has necessitated the automated dispensing of specialty drugs that demand specialty drug prescription filling solutions. According to the Global Cancer Observatory (GLOBOCAN 2020) report, there were 9,958,133 cancer-related deaths worldwide and an estimated 19,292,789 new cancer diagnoses. In terms of new cancer cases in 2020, breast cancer will account for 2,261,419 of them, followed by lung (2,206,771), colorectum (1,931,590), prostate (1,414,259), and stomach (1,089,103). The increasing incidence of cancer globally raises the demand for oncology drugs that are specialty drugs.

Furthermore, the increasing demand for personalized medications that treat chronic diseases by considering the individual variability in genes has also boosted the demand for specialty drug prescription filling solutions. Hence, with the increase in complex, chronic, rare diseases, the rising demand for specialty drugs has been boosting the prescription filling solutions in the market studied.

Rising Need to Minimize Medication Errors

Error and contamination are improbable with pharmacy automation. This robotic equipment stockpiles the different drugs or medications in separate cells/chambers to evade cross-contamination. Most automation systems also have a photo authentication feature, which records each medication digitally while filling. This process may likely increase patient safety while reducing pharmacies' liability risk.

Moreover, due to the recent COVID-19 outbreak, there is a possibility of infection from healthcare workers. Therefore, pharmacy automation has proven to be the best method for containing the outbreak. Pharmacy automation systems are advantageous for patients, pharmacies, and important healthcare professionals including pharmacists and doctors. Additionally, automated solutions have enormous cost-effective and safety advantages. By streamlining data reporting and workflow, they significantly streamline pharmacy operations. All of these technological advancements have made it easier for pharmacies to stay competitive in a sector that is continually changing, but they have also benefited patients and physicians in many ways. Pharmacy automation helps reduce costs by decreasing overall manual labor expenses. According to 2019 articles, it was found that approximately USD 12 per hour can be reduced with the help of an automated dispensing machine, and the job can be done more quickly and accurately, deprived of the need for breaks, vacations, or sick days. Thus, owing to the factors mentioned above, the pharmacy automation market is expected to grow significantly during the projected period.

Global Pharmacy Automation Market Restraint

Reluctance to Adopt Pharmacy Automation Systems

Despite the advantages connected with pharmacy automation technologies, several healthcare professionals and providers have been hesitant to adopt or accept any IT-based method for pharmacy administration. Many pharmacists are hesitant to include pharmacy automation technologies in their dispensing routine because they do not see a need for assistance. Additionally, though pharmacy automation may reduce pharmacy and hospital costs and provide many benefits, specific institutions' infrastructure, workflow, and management, the initial investments required for the implementation of these systems in pharmacies and hospitals have been way expensive, which has found acting as a barrier to adopt pharmacy automation systems. As is the case with any new technological framework implementation, the financial cost of healthcare information technology support is one of the significant barriers to the implementation of pharmacy automation. Not only does pharmacy automation need basic technological infrastructure, but they also require basic training for installation and maintenance, which adds to the financial burden of their implementation, thereby making it the most significant obstacle that healthcare setups face. Around 80% of primary care setups cite a dearth of financial support as a significant hindrance to its implementation, which has been significantly hindering the pharmacy automation market growth.

Global Pharmacy Automation Market Opportunities

Decentralization of Pharmacies

In a decentralized approach, the medications are kept in the medication room and will only dispense after the doctor's order. This model also provides multiple tower dispensers along with medication rooms housing multiple dispensers. In addition, these systems provide computer-controlled storage, tracking of medications, and dispensing that have been recommended widely. Moreover, there has been a shift from centralized to decentralized medication dispensing systems as they are considered more cost-effective and efficient.

According to an NCBI study published, it has been observed that in Canada, more than half of hospitals (44%–46%) are currently utilizing a decentralized practice model, and only 7% use a strictly centralized pharmacy practice model. Clinical pharmacists have been shown to improve both morbidities- and mortality-related outcomes for patients by providing drug-use evaluation, in-service education, management of adverse drug reactions, management of drug protocols, and admission and discharge medication reconciliation, as well as by participating in cardiopulmonary resuscitation teams and medical rounds and contributing in various ways to reducing the length of the hospital stay. Hence, the rising demand for decentralization of pharmacies due to various reasons, such as providing medication rooms, housing multiple dispensers, and cost-effectiveness, which have been driving the market for decentralized pharmacies.

Regional Analysis

By region, the global pharmacy automation market share is bifurcated into North America, Europe, Asia-Pacific, South America, and Middle East & Africa. 

North America Dominates the Global Market

North America dominated the market and is anticipated to register a CAGR of 7.7% during the forecast period. The US is expected to dominate the overall pharmacy automation market, throughout the projected period, due to the increasing demand for pharmacy automation systems, owing to their The need to concentrate on offering value-based treatment to patients in the United States is necessitated by a rise in the frequency of prescription errors caused by human interaction in specialty medicine administrations. According to the US Food and Drug Administration (FDA), 2019, it was found that every year, more than 100,000 cases continue to be reported in the US, with a suspected medication error. Also, an increase in the shift toward automated systems due to the reduced labor costs for filling, packaging, and labeling, coupled with enhanced compounding and dispensing, has drawn attention toward the market studied, thereby contributing to its outstanding market revenue share throughout the forecast period.

Europe is the second largest region. It is estimated to reach an expected value of USD 2255 million by 2031, registering a CAGR of 8.9%. The pharmacy automation market in France is growing at a good pace. Factors such as the increasing geriatric population, the growing demand for reduced errors in the healthcare industry, the rising need for suppression in cost, and the increasing demand for technologically advanced products in healthcare infrastructure are driving the overall market growth. Furthermore, according to the United Nations Department of Economic and Social Affairs, in 2019, an estimated 13,281 population aged above 65 years in France, and the number is estimated to reach 16,094 by 2030. The rising geriatric population is susceptible to several chronic diseases and thus increases the demand for medication, further boosting the overall market growth in the country. In addition, the COVID pandemic has also increased the demand for pharmacy automation due to the rising demand for medication. Thus, it also acts as contributing factor to market growth. Hence, these factors are expected to propel the growth of the studied market in France.

Asia-Pacific is the third largest region. The Chinese pharmacy automation market is primarily driven by the rising demand for specialty drug prescription filling solutions, the increasing need to minimize medication errors, and the decentralization of pharmacies. A rising incidence of chronic and life-threatening diseases, along with increasing dispensation of medications, is also one of the key factors contributing to regional market growth. As per the International Diabetes Federation (IDF), in 2020, around 116.44 million adults, which account for around 10.9% of the total adult population, had diabetes. Hence, an increasing number of patients are being admitted, which puts more strain on the old pharmaceutical system and raises the need for automated medicine dispensing systems. One indicator of this is the rising prevalence of such chronic illnesses.

Segmental Analysis

The global pharmacy automation market is segmented by product, end-user, and region.

By product, the global market is segmented into automated tabletop counters, automated packaging and labeling systems, automated storage and retrieval systems, automated medication dispensing systems, and other products. The automated medication dispensing systems segment dominated the market and is estimated to grow at a CAGR of 7.9% during the forecast period. Automated medication dispensing systems are decentralized medication distribution systems that typically cover activities, including computer-controlled storage, tracking, and medication dispensing. It is one of the crucial tools in improving efficiency, optimizing workflow in pharmacies, and ensuring patient safety. The companies are adopting strategies, such as partnerships, mergers, acquisitions, and others, to grow their presence in the market. With the emergence of COVID-19, pharmacies were piled up with prescriptions, administration of COVID-19 tests, and home deliveries of prescriptions and OTC. This led to the rising demand for automated medication dispensing systems. Hence, all these indicate positive growth during the forecast period. Additionally, Capsa Healthcare offers a "NexsysADC Automated Dispensing Cabinet" that is designed for securing storage of sensitive and expensive medication doses, tight inventory management, billing control, and other activities. Hence, improvements in automated medication dispensing systems and rising adoption of the same are expected to lower the downtime in pharmaceutical workflow, which, in turn, will boost the further market growth.

By end user, the global market is segmented into hospital pharmacies and retail pharmacies. The hospital pharmacies segment dominated the market and is estimated to register a CAGR of 8.3% during the forecast period. In many hospitals, separate departments manage all hospital-related purchasing. These include pharmaceuticals, medical supplies, equipment, and others. The pharmacy department is controlled by several people for pharmaceutical procurement, with a designated committee helping. Hospital pharmacies are expanding with a higher preference for pharmaceutical companies to make necessary medications available at the earliest. Since the frequency of patients in the outpatient department is significantly high in the daytime, the importance of such services is inevitable. Furthermore, the outbreak of COVID-19 has created immense pressure on hospitals, impacting pharmacies as well. The major challenge posed in front of them was to balance the demand and supply of medications to the large section of the population and, at the same time, optimally use the resources. These factors majorly contributed to the adoption of automated pharmacy technologies in this segment. A study titled "Automation of in-hospital pharmacy dispensing: a systematic review," published in April 2020, evaluated the role and impact of automated dispensing systems among in-hospital pharmacies in the European region. The studies revealed that automated dispensing systems have positively impacted the enhancing reliability and efficiency of medication management in these hospital pharmacies. Such instances are expected to support the market growth in this segment.

Recent Developments

• October 2022 - The debut of Specialty Pharmacy Services, a turnkey product with specialized services to set up, run, and optimize a specialty pharmacy program, was announced today by Omnicell, Inc. (Nasdaq: OMCL), a leading supplier of medication management and adherence technologies for health systems and pharmacies.
• September 2022 - Omnicell, Inc. (Nasdaq: OMCL), a top provider of medication management and adherence tools for hospitals and pharmacies, held its 2022 Investor Day today. During the event, the company provided a detailed overview of its differentiated strategy and distinctive business model, as well as information on its Advanced Services portfolio, ESG strategy, and long-term financial goals.