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Pharmaceutical Franchises Have Great Scope in Tier II and Tier III cities

The pharmaceutical industry is expected to expand at a CAGR of 12.89 per cent over to reach USD 55 billion by 2020

By Content Writer
Pharmaceutical Franchises Have Great Scope in Tier II and Tier III cities

India is emerging to be one of the fastest growing economies in the world. With quality human resources and technological advancement, the healthcare sector is continuously prospering. In the pharmaceutical sector, India enjoys an important position in the global pharmaceuticals sector.

The country is the largest provider of generic drugs globally, with supplying over 50 per cent of global demand for various vaccines, 40 per cent of generic demand in the US and 25 per cent of all medicine in the UK.

The Indian healthcare sector is expected to advance at a CAGR of 17 per cent to reach USD 250 billion by 2020, with the pharmaceutical industry expected to expand at a CAGR of 12.89 per cent over to reach USD 55 billion by 2020.

Low cost of production and R&D is boosting the efficiency of Indian pharmaceutical companies, which  have increased their spending to tap rural markets and develop better medical infrastructure. The market in tier II and tier III cities is highly unsegmented, thus creating huge opportunities for pharmaceutical franchises in these cities. Below are some of the reasons why small cities hold huge potential for the pharma industry.


Economic prosperity in small cities is improving the affordability for generic drugs in the market and also addint to the per capita sales of pharmaceuticals in India. Rising incomes are expected to drive 73 million households to the middle class over the next 10 years. With increasing disposable incomes, people in small cities are opting for quality medication from reputable franchises.

Rising Demand

With 70 per cent of India’s population residing in rural areas, pharma companies have immense opportunities to tap this market. Demand for generic medicines in rural markets has seen sharp growth. This is one of the most important reasons why various companies are investing in the distribution network in rural areas.


One of the major roadblocks for pharma franchises in tier II and tier III cities was acceptability. People of small cities were often reluctant to buy modern medicines and preferred to stick to home remedies. But, recent times have seen the most notable change in consumer behaviour. Owing to aggressive market creation by players, an increased acceptance of biologics and preventive medicine, and a greater propensity to self-medicate, people have become more accepting of modern medicine and newer therapies.

Brand Name

Franchising offers a reputable brand name. With an increase in literacy level in small cities and rise in penetration of technology and the internet, people are becoming increasingly aware of reputable brand names. Starting a franchise in rural India not only offers you an established model, but also a reputable brand name, which people can easily trust,thus providing greater opportunity for success.

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