You want to sell your pharmacy? Then it's good to know what the pharmacy acquisition market looks like. Rabobank predicts that scaling up of existing pharmacists will continue to increase. In addition, developments in the market are leading to a shift in services from one branch point to more branch points and more of an omnichannel character (webshop, delivery and 24-hour safe).
Concrete figures on the number of mergers and acquisitions in the pharmacy industry do not exist. Therefore, here are estimated figures. However, it is known that pharmacies are increasingly transforming into retailers, according to platform RetailDetail. Although Rabobank expected consolidation earlier in 2020, it did not happen and the number of branches continued to decline.
There are many ways to value a business. A common method of expressing the value of a business is "a factor x gross annual profit." This factor is also called multiple and another designation for gross annual profit is EBITDA (Earnings Before Interest Taxes Depreciation and Amortization).
In healthcare and pharmacy, the sector to which pharmacies belong, an indicative range of EBITDA multiple of 5.90 to 6.90 is currently used, according to the Brookz Takeover Barometer. The average EBITDA multiple across all SME sectors is 4.90.
The valuation of a business is often the starting point for negotiations between buyer and seller. The outcome of these negotiations is the final sales price. So valuation and price are two different quantities. Besides valuation, the price is also determined by possible scarcity in the market, bargaining power of the parties, the strategic value of the business for the buyer and possible synergy effects for the buyer (cost savings, purchasing advantages).
Do the calculation
The Netherlands has five pharmacy formulas with more than about one hundred and fifty affiliated pharmacies, according to research by the Foundation for Pharmaceutical Statistics. An SFK inventory shows that BENU Apotheken, affiliated with wholesaler Brocacef, will be the largest pharmacy formula in early 2019 with a total of 482 affiliated pharmacies.
In figures, the number of pharmacies in 2024 looked as follows(CBS):
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A number of trends and developments will inevitably cause changes in the coming years, but also offer pharmacies many growth and acquisition opportunities:
Contact with patients is becoming easier and easier, and therefore more innovation is taking place in the distribution model. Think online orders, 24-hour medication dispensers and various delivery times. As a result, pharmacists have to make more conscious choices in their services.
Scarcity in the market is unfortunately also the order of the day for pharmacists. More and more often you read about people with health conditions who cannot get their much-needed medication at the pharmacy. According to ABN AMRO, it is essential that the production of medicines is drawn to Europe, making us less dependent on countries such as China and India. Also, then-Minister van Rijn announced that by July 1, 2022, there must be a supply of medicines for at least five months.
Innovation plays an important role, both in terms of product and process. This can take the form of new partnerships with nutrition consultants, e-health (creating an online relationship and increasing understanding of medication use) or the role of nutrition in medication and prevention.
Changing market conditions are expanding the role of pharmacists to pharmacist, logistics manager and retailer all in one. Depending on the environment, the retail activities of the pharmacy can be expanded to include self-care medication, hearing and optical supplies to increase revenue and margin. In doing so, the pharmacy is not always optimally visible in the neighborhood, and this needs to be addressed, according to the Young Pharmacists Association (VJA).
Pharmacists collect medicine waste, such as unused medications and needles. Proper disposal of drug waste prevents drug residues from entering surface and groundwater. Society demands that pharmacists do this in a sustainable manner.
