The key to the collaborative development of industry and retail lies in targeting patient health outcomes, enhancing the professional level of the industry, and ultimately achieving the transformation from "pharmaceutical sales" to "health solution providers"…
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Pharmacies Face Survival Crisis as Challenges Escalate
Facing the Dual Challenges of Slowing Market Growth and Increasing Operational Pressures, China's Pharmaceutical Retail Industry is Entering a Critical Stage of Strategic Transformation. Latest statistics from Zhongkang Pharmacy Channel show that, as of the end of 2024, the total number of pharmacies in China reached 700,881, marking a 2.3% increase compared to the same period in 2023. Notably, this historical peak may stabilize by early 2025, signaling a turning point in the industry’s expansion trend.
Monitoring Data Reveals Significant Trend: Total Number of Pharmacies in China Decreased by 0.5% QoQ in Q4 2024, Marking the First Quarterly Negative Growth in Recent Years; If Contraction Continues for the First Two Quarters of 2025, Q4 2024 May Officially Mark a Watershed Moment for Store Development Volume in the Pharmaceutical Retail Industry.
In terms of category management, the sales of traditional pharmaceuticals continue to face pressure, while innovative drugs are showing strong growth, highlighting the deepening structural contradictions in the pharmaceutical retail sector. Industry observers point out that the core driving force behind the current market transformation stems from a fundamental shift in consumer demand. However, most traditional pharmacies still struggle with insufficient professional service capabilities, making it difficult to effectively adapt to the value restructuring brought about by the upgrading of demands.
Against this industrial backdrop, the discussion on innovation in pharmacy survival models and value reconstruction continues to heat up. On April 18, Novartis China and Sinopharm Holding Guoda Pharmacy Co., Ltd., a leading chain pharmacy in China, jointly held a strategic alignment meeting in Taiyuan under the theme “Value Retail: Born for Patients.” Both parties reached an in-depth consensus on core issues such as deepening patient service strategies, promoting the construction of value-based stores, and strengthening pharmacists' professional service capabilities, and formulated specific implementation plans to jointly explore innovative paths for industry transformation and upgrading. 02Born for Patients: Reshaping Retail Value
For the pharmaceutical retail industry, effectively managing chronic diseases is not only crucial work for pharmacies to demonstrate their professional value but also a core pathway for creating incremental value. Given the characteristics of chronic disease progression and treatment complexity, patients still require long-term disease management after completing hospital consultations. Under the current allocation of medical resources, relying solely on medical institutions makes it difficult to achieve continuous health management, which objectively leads to the widespread issue of insufficient medication adherence among chronic disease patients.
Take hypertension as an example. Asymptomatic hypertension can lead to an increased risk of patients autonomously discontinuing medication. Coupled with the limited capacity of medical institutions, it is difficult to carry out individualized medication monitoring and dynamic follow-ups, affecting the precise adjustment of treatment plans. Against this industry backdrop, out-of-hospital pharmaceutical retail service scenarios are endowed with new strategic value.
The current medical scene is undergoing a fundamental shift: patients' in-store needs have evolved from simply purchasing medications to acquiring health management solutions. Over the past year, the "value retail" concept jointly promoted by Novartis and key chain stores in China has been widely accepted and recognized by the pharmaceutical retail industry. According to the Vice President of Novartis China,Head of Retail, Emerging Markets and BusinessIn Chen Hui's view, being born for patients is a noble value pursuit for many health industry practitioners. He believes that the essence of "value retail" is to achieve the coordinated development of patient health management and commercial value by reconstructing the pharmaceutical service value chain.
Hui Chen, Vice President of Novartis China, Head of Retail, Emerging Markets and Commercial
Zhong Xiangjun, member of the Party Committee and head of operations management at Sinopharm Holding Guoda Pharmacy Co., Ltd., believes that addressing the "last mile" issue of health services for ordinary citizens is a social responsibility pharmacies need to undertake. Serving patients with professionalism reflects the core value of a pharmacy.Heart Value. Sinopharm Holding Guoda Pharmacy Co., Ltd. has always firmly supported frontline stores in enhancing and strengthening the professional level of pharmacists, and is also willing to work with like-minded brand partners to create value retailing. He stated that through cooperation with Novartis China, a group of highly skilled and outstanding pharmacists has been jointly nurtured. Both parties are moving forward hand-in-hand towards a patient-centered retail pharmacy value ecosystem.
Zhong Xiangjun, Member of the Party Committee and Operation Management Director of Sinopharm Holding Guoda Pharmacy Co., Ltd. Taking the cooperation model between Novartis and Guoda Pharmacy as an example, the conference featured guests sharing the achievements of the implementation of value retail through the collaboration between Novartis and Guoda. Additionally, outstanding branch companies shared their successful experiences. In promoting "value retail," Guoda Pharmacy conducted extensive management programs for patients with hypertension and psoriasis. By enhancing the professional capabilities of pharmacists, they provided warmer and more specialized services to patients, helping improve medication adherence and effectively enhancing patients' quality of life. Guest Sharing In the industry insight seminar, Li Hongjian, General Manager of the Strategic Business Development Center of Sino Health Technology, systematically deconstructed the challenges and opportunities faced by the pharmaceutical retail industry based on an industry research model. She pointed out that, against the backdrop of medical insurance reform, retail terminals are undergoing a paradigm shift from "channel value" to "service value." "The new era of medical insurance requires industry players to reconstruct the value coordinate system — with patient health as the origin, building a double helix value chain of 'precise drug accessibility × continuous health management.'" Regarding the practical path of value retail, Li Hongjian believed that the collaboration between manufacturers and retailers needs to break through traditional supply chain thinking by promoting data interconnection, co-building service standards, and jointly developing health management pathways, allowing value stores to become hubs for rebuilding doctor-patient trust. This model not only achieves a "treatment-management-rehabilitation" service loop in scenarios where prescriptions flow outside hospitals but also creatively transforms the professional potential of specialty pharmacies into service momentum for chronic disease management, ultimately forming a positive flywheel of health benefits and commercial growth.
Li Hongjian, General Manager of the Strategic Business Development Center of Zhongkang Technology
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Industry and Retail Join Hands to Create "Value Retail"
The essence of the "Value Retail" strategy is not merely a simple technological iteration or scenario transformation, but a systematic change based on the comprehensive lifecycle health management needs of patients. Its core lies in building a value loop of "demand insight-service delivery-trust accumulation." Through strategic collaboration between the industrial and retail ends, it focuses on investing in the professional capacity building of pharmacists and digital infrastructure, ultimately achieving a strategic leap from "medicine supplier" to "health value creator."
The structural dilemma of 700,000 terminals currently faced by the pharmaceutical retail industry stems from the paradigm mismatch between traditional commodity trading models and modern health service demands. The focus of industry development has undergone a fundamental shift: from the basic requirement of ensuring drug accessibility, to building a concentric circle strategy centered on patient value during the reconstruction of the industrial ecosystem, which has become an inevitable choice for the main players in the health industry. Chen Hui emphasized: "The implementation of the 'Value Retail' strategy will lead to threefold value transformation—first, the explicit conversion of pharmacists' professional value; second, the symbiotic growth of health benefits and commercial value for chain institutions; and ultimately, the reshaping of the doctor-patient trust hub within the medical ecosystem."
Based on the strategic consensus of "born for patients," Novartis and Sinopharm Holding Guoda Pharmacy Co., Ltd. have embarked on a new chapter of the 2025 Value Retail Strategic Cooperation. At the strategic alignment meeting, core representatives from both parties jointly witnessed the launch of the "Value Retail, Born for Patients" project ceremony, promoting the construction of value-based pharmacies towards higher and broader ideal heights.
In the deep waters of industry transformation, the strategic synergy between Novartis and Sinopharm Holding Guoda Pharmacy is writing a new model for pharmaceutical retail. As 700,000 pharmacies face collective questioning about service capabilities and business models, the in-depth cooperation between the two parties offers a key solution. This transformation, centered on patient health value, provides a verifiable implementation framework to solve the problem of "hollowed-out service value" for 700,000 pharmacies. By creating replicable value store models, it establishes a closed-loop service network from disease education, medication tracking to health intervention, truly realizing the reallocation of medical resources with "treatment port moving forward and management scenarios sinking," driving China's pharmaceutical retail industry into a new cycle driven by value services.
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