Japanese government to finally lift ban on online drug sales

Photo by gullevek, CC-license
Photo by gullevek, CC-license

Japanese prime minister Shinzo Abe announced earlier this week that the government would lift the ban on online drug sales as a part of his economic stimulus package. In Japan, online drug sales has been prohibited not only because of the obvious fear that people would abuse over-the-counter drugs without proper medical consultation, but also — and this is the main reason — is that conventional drug retail chains and entities in the pharmaceutical industry are resisting the change.

As some of our readers may know, Hiroshi Mikitani, the head of Japanese commerce giant Rakuten (JASDAQ:4755), has been strongly lobbying the government for the past few years to remove the ban. It should also be noted that company has more than a half stake in the Japan’s largest online drug retailer, Kenko.com (TSE Mothers:3325). That company has established a local subsidiary in Singapore to serve Japanese customers without violating the Japanese drug law.

Rakuten’s Mikitani and Kenko.com’s CEO Genri Goto once brought a lawsuit against the government, because the regulation reduced accessibility of drugs and supplements for many who really needed them. Upon the government’s announcement, Kenko.com’s Goto commented:

I really appreciate the prime minister’s decisive judgment (to lift the ban) because it will permit the sale of “all types of medical drugs” online. In terms of providing pharmaceutical consultations to customers when purchasing drugs, it is needless to discuss whether online or face-to-face consultation is better. To meet the needs and expectations of consumers, we need to discuss what kind of rules will serve them better.

On a related note, Askul (TSE:2678), one of Japan’s largest B2B services dealing in office stationary is reportedly going to join the Japanese online drug market soon. In terms of the variety of drugs available, Askul expects to sell more than 4,000 kinds of drugs on its website, which means stiff competition for Kenko.com which has 4,300 items currently available.