Starting a Pharmacy Business in Dubai: A Complete Guide (2023)
Dubai offers tremendous opportunities for entrepreneurs looking to open pharmacies. With its growing population, booming tourism industry, and rising healthcare spending, the demand for pharmacies is higher than ever. This comprehensive guide covers everything you need to know to successfully start and run a pharmacy business in Dubai.
Introduction: Start a Pharmacy Business in Dubai
Dubai’s reputation as a dynamic global business hub makes it an attractive market for healthcare services. The emirate offers a thriving environment for pharmacy entrepreneurs due to the following key factors:
Dubai’s Expanding Population and Demographics
Dubai has a population of over 3.3 million (in 2019) which grows annually thanks to a high influx of expats. The population is expected to reach 5.8 million by 2040. This creates a huge consumer base for pharmacies. The population also has favorable demographics with 75% adults in working age and continued growth in elderly residents.
Increasing Health Expenditure
Health expenditure in the UAE is projected to grow at a CAGR of 5% from 2019-2023, reaching USD 19.5 billion by 2023. Dubai accounts for a major share of the nation’s booming healthcare industry. This spells opportunities for pharmacies.
High Prevalence of Chronic Diseases
Lifestyle changes have led to high rates of conditions like diabetes (affecting over 19% of adult population) and cardiovascular diseases. Such ailments increase demand for prescription drugs and medications, driving pharmacy sales.
Expanding Medical Tourism
Dubai medical tourism is growing exponentially. The emirate received 669,000 medical tourists in 2019, a growth of 5.5% over 2018. This sector looks highly promising for pharmacies located near hospitals/clinics.
Dubai offers superb infrastructure, low taxes, facilitated company ownership policies, availability of capital, and minimal red tape. The excellent environment and support for businesses makes it easy to set up and operate pharmacies.
Given these promising conditions, Dubai presents lucrative prospects for entrepreneurs to launch new pharmacy ventures or expand existing ones.
Understanding the Pharmacy Market in Dubai
Gaining in-depth knowledge of Dubai’s pharmacy segment is vital for making informed business decisions. Here are key details about the market:
Demographics and Medication Usage
- 75% of Dubai’s population comprises expatriates from diverse nationalities.
- Chronic conditions like diabetes, high BP, high cholesterol affect 20-30% adults.
- Prescription drug use is high, especially for diabetes, cardiovascular, gastrointestinal issues.
- Top selling drug categories are antidiabetics, pain relievers, antibiotics, dermatologicals.
- Market has over 1100+ pharmacies including chains like BinSina, Lifepharmacy, Pharmacies, and smaller independent stores.
- Chains hold majority market share (~60%) while independent pharmacies cater to neighborhood demand.
- Main competition parameters are prices, discounts, loyalty programs, e-pharmacy services.
Growth Trends and Opportunities
- Increasing demand for specialty drugs for chronic illnesses.
- Growing popularity of generics due to cost-conscious buyers.
- Rising sales of OTC medicines, dietary supplements.
- Scope for expanding e-pharmacy operations and home deliveries.
- New outlets in residential areas to cater to underserved localities.
- Rising real estate and licensing costs.
- Staffing shortages – lack of qualified pharmacists.
- Inventory management difficulties due to supply chain issues.
- Regulatory compliance requires dedicated resources.
Regulatory Environment for Pharmacies in Dubai
Dubai’s pharmacy sector is regulated by various authorities. Being aware of the key regulations is important for compliance and smooth business operations:
Ministry of Health and Prevention (MOHAP)
MOHAP regulates core aspects of pharmacies in Dubai including:
- Issuing new pharmacy licenses and renewals.
- Setting rules for pharmacy premises size, design, dispensary counters.
- Approving location suitability for a pharmacy business.
- Regulating inventory management, drug registration, storage and dispensation.
- Monitoring compliance with prescription drug laws.
- Setting guidelines for pharmacy products pricing.
Department of Economic Development (DED)
The DED is responsible for:
- Issuing commercial licenses to establish a pharmacy business.
- Trade name registration and other startup legal formalities.
- Ensuring facilities meet occupational health and safety standards.
- Implementing regulations for data protection, business conduct etc.
Dubai Health Authority (DHA)
The DHA regulates:
- Licensing and qualifications criteria for pharmacists.
- Standards for pharmacy services, dispensing, counselling practices.
- Sale and stocking of DHA-prohibited pharmaceuticals.
The municipality oversees:
- Zoning laws and land use regulations for pharmacies.
- Approving location suitability and issuing NOCs.
- Physical premises layout, parking, other infrastructure compliance.
Step-by-Step Pharmacy Licensing Process in Dubai
To legally operate a pharmacy in Dubai, you must obtain licenses from the DED and MOHAP. Here is the step-by-step process:
DED Commercial License
- Identify suitable commercial location or lease retail space. Get NOC from Dubai Municipality.
- Obtain pre-approval from DED for the business activity – “Wholesale and Retail Trade of Medical Goods and Equipment”.
- Submit license application to DED with business plan, owners’ details, legal documents. Pay fees.
- Once approved, complete trade name registration, establishment card registration.
- Obtain other needed permits – signage, civil defense etc.
MOHAP Pharmacy License
- Recruit licensed pharmacists as per DHA norms. At least one full-time pharmacist is required.
- Apply for pharmacy license from MOHAP with premises ownership/lease details, pharmacist NOCs, staff list.
- MOHAP inspects premises and inventory infrastructure for approval.
- Once approved, complete computerized inventory software implementation.
- Undergo inspection for final license issuance. Display license prominently.
Pharmacists must register with DHA and obtain a professional license. The eligibility criteria include:
- A recognized Bachelor’s/Master’s degree in Pharmacy.
- Proof of English proficiency.
- Passing qualifying Pharmacy exams.
- Emirates ID and medical fitness certificate.
The licensed pharmacist will be your facility’s legally responsible representative.
Choosing the Right Location for Your Pharmacy
Choosing an optimal location is crucial for the success and viability of your pharmacy business in Dubai. Here are some key factors to consider:
Visibility and Accessibility
Ideally pick a spot with heavy footfall in commercial/residential areas with a pharmacy need gap. Being on bus routes and metro stations helps attract walk-ins.
Nearby Healthcare Facilities
Proximity to hospitals, clinics, diagnostic labs generates prescription footfall. Pharmacy next-door partnerships also work well.
Consider the income levels, age groups, and health conditions prevalent in the area. This indicates the demand for medications.
Study existing pharmacies in the locality and avoid saturation. Identify neighborhood gaps that your pharmacy can fill.
Parking and Transport Links
Convenient parking and access via public transport enables customers to visit easily. It also helps attract talent during hiring.
Zoning and Premises Regulations
The premises must meet MOHAP and municipality regulations. Consider getting a real estate agent to find compliant available spaces.
Setting Up Your Pharmacy in Dubai
Once licensing and location are done, you need to set up the physical infrastructure and facilities. Here are the key steps:
Design and Layout
- Premises should have minimum 150 sq. ft. area as per MOHAP rules.
- Clearly designated and organized dispensing areas and storage spaces.
- Patient counseling and waiting sections.
- Wheelchair access and washrooms.
Fixtures and Furnishing
- Invest in quality racks, counters and drug shelves. Also refrigerators for temperature-sensitive stock.
- Comfortable seating in waiting areas, and dispensing stools.
- Security systems like CCTVs, alarms, locking drawers.
- Cash registers and billing systems for checkout.
- Inventory management software for stock control.
- Pharmacy management system for procurement, reports etc.
- Hardware like computers, scanners, internet, and phones.
- Recruit professionally qualified and licensed pharmacists. Also hire assistants.
- Optimize staff shifts to have full coverage during operating hours.
- Provide uniforms, name badges and training on processes.
Inventory and Stocking
- Stock base medicines, first aid items, surgical supplies, medical devices etc.
- Maintain 15 days inventory for fast moving items and 1 month for slow movers.
- Follow FEFO (First Expire First Out) method.
Running Your Pharmacy’s Operations in Dubai
With your physical infrastructure in place, you now need to implement systems and processes for smooth functioning:
Managing Procurement and Inventory
- Identify reputed pharma distributors and get trade accounts for procurement.
- Track expiry dates, demand levels, and lead times and order accordingly.
- Ensure no drugs are expired or near expiration. Follow stock rotation protocols.
- Conduct monthly physical inventory audits and updates. Maintain precise book inventory.
Dispensing and Counseling Practices
- Verify doctor prescriptions carefully. Provide generic alternatives if branded not available.
- Counsel patients on dosage schedules, possible side effects, precautions etc.
- Follow good dispensing hygiene and safety processes. Avoid medication errors.
- Maintain patient records with dispensing details as per regulations.
- Implement accounting best practices – invoicing, vouchers, petty cash.
- Enforce dual custody of cash and strict closing/opening procedures.
- Do monthly reconciliations of bank statements.
- Ensure timely vendor payments, license renewal, taxes.
- Adhere to controlled drugs storage protocols set by MOHAP.
- Comply with data protection and privacy regulations.
- Renew trade licenses and municipality certificates annually.
- Display price lists and licenses as per norms.
- Train pharmacy staff on customer service etiquette and protocols.
- Resolve insurance/billing issues promptly and keep patients informed.
- Set up customer feedback channels like surveys, social media.
- Offer home delivery services for improved convenience.
Marketing and Promotions Strategy of Pharmacy Business in Dubai
Creating pharmacy brand awareness among consumers in Dubai requires implementing a solid marketing plan. Here are proven tactics:
- Build an intuitive pharmacy website highlighting services offered.
- Run Google/Facebook ads to improve visibility in searches. Geo-target nearby areas.
- Email newsletters to retain customers and promote health programs.
- Active social media presence to engage customers and improve SEO.
Partnerships and Referrals
- Partner with insurance providers to boost footfall. Offer discounts to members.
- Build referral relationships with nearby clinics, hospitals etc.
- Tie up with corporates/schools to service their health plans and staff.
- Offer special discounts on chronic meds, OTC brands, first-time purchases etc.
- Run seasonal offers during festivals, back-to-school period etc.
- Loyalty programs giving points redeemable for free products.
- Promote health check-ups camps, vaccination drives to engage community.
- Invest in exterior signage, branding of prescription packaging, uniforms etc.
- Improve storefront appeal with notice boards, brochure stands.
- Sponsor nearby events and local sports teams to enhance visibility.
Success Story: Medcare Pharmacy, Jumeirah
To understand running a pharmacy business in Dubai better, let’s examine a case study of Medcare Pharmacy located in Jumeirah:
Medcare Pharmacy operates on a franchise model under the Medcare Group. It leverages the group’s strong healthcare reputation while retaining its own local identity.
Its proximity to Jumeirah Hospital, clinics, diagnostic centers and residential complexes helps drive footfall. The pharmacy sees 500+ daily customers on average.
It stocks over 10,000 products including prescription and OTC drugs. It also sells medical devices, supplements etc. Home delivery services provide convenience.
Medcare has adopted automation for inventory management. Its online portal and app enable easy repeat prescription orders and deliveries.
Well-trained pharmacists provide exceptional service. Value-adds like gift-wrapping and monthly promotions make it popular with loyal customers.
Due to its success, Medcare plans expanding through more franchise outlets across residential communities in newer parts of Dubai.
Conclusion: Start a Pharmacy Business in Dubai
The growing demand for pharmacies in Dubai offers tremendous prospects for aspiring entrepreneurs. By obtaining the right licenses, choosing a strategic location, implementing good operating processes, and building a strong brand image, you can establish a successful pharmacy business here.
Partnering with specialists well-versed in Dubai’s regulatory nuances can help overcome obstacles and ensure smooth setup. With the right approach and diligent execution, your pharmacy can flourish in Dubai’s vibrant healthcare market.
Now you know how to start a pharmacy business in Dubai, if you want to setup your own pharmacy business in Dubai, please feel free to write us at: firstname.lastname@example.org or WhatsApp us at: +971585865477 or +918750030003 to book free business consultation with our business expert.