U.S. Retail Pharmacy Market Size, Share, and Growth Forecast for 2025 - 2032

U.S. Retail Pharmacy Market Size and Share Analysis

The U.S. retail pharmacy market is estimated to increase from US$ 609.2 Bn in 2025 to US$ 818.0 Bn by 2032. The market is projected to record a CAGR of 4.3% during the forecast period from 2025 to 2032. The rising number of chronic illnesses and the surging use of prescription drugs are contributing to the development of retail pharmacies in the U.S. 

The aging population and rising prescription medication consumption are contributing factors to the U.S. retail pharmacy business growth. For instance, prescriptions were used by 66% of people in 2023, and 32% of national health spending was covered by Medicare.

The shift toward home health care, clinics, and mail-order pharmacies is attributed to consumer preference for over-the-counter drugs and home delivery. Pharmacies offer a variety of patient-care services, such as flu immunizations, blood pressure monitoring, diabetes education, medication therapy management, compression socks, smoking cessation aids, and compounding.

The COVID-19 pandemic has also impacted the pharmacy business, with increased demand for medications, vaccines, and healthcare products. Increasing revenue from vaccine administration and telehealth services has led to an expansion of pharmacy services in the U.S. 

Key Highlights of the Market 

• In 2025, the U.S. medicine industry underwent significant changes, with branded drugs attaining a market share of 67.3%. 
• The prescription drugs segment is set to lead with a 54.2% market share in 2025 due to the rising prevalence of chronic diseases. 
• Consumers are increasingly seeking easy access to medications and healthcare services, leading to the growth of retail pharmacies.  
• The U.S.'s increasing healthcare spending is driving growth of the retail pharmacy market.  
• Chronic diseases like diabetes and heart disease necessitate continuous medication, driving market growth due to their prevalence in the U.S. 
• The industry is rising due to government policies and programs in the U.S. that support healthcare infrastructure and accessibility

Market Attributes	Key Insights
U.S. Retail Pharmacy Market Size (2025E)	US$ 609.2 Bn
Projected Market Value (2032F)	US$ 818.0 Bn
U.S. Market Growth Rate (CAGR 2025 to 2032)	4.3%
Historical Market Growth Rate (CAGR 2019 to 2024)	4%

Generic Drugs Gain Traction in the U.S. Owing to High Effectiveness

Category	Market Share in 2024
Product Type- Generic Drugs	67.3%

Significant changes occurred in the U.S. branded and generic medicine industry in 2024. Despite huge investments in research and development, branded drugs maintained their market dominance, holding a 67.3% share in the same year. For example,

• Though they only make up 17.5% of all pharmaceutical costs, 90% of U.S. prescriptions are now generic.
• Generics helped the healthcare system and individuals in the country save US$ 408 Bn in 2022.

Patients consuming blockbuster medicines are expiring, and generics are gaining market dominance by providing highly affordable options. Increased FDA approvals of generic medications have made them widely available and reasonably priced.

• Up to US$ 9.4 Bn was saved in 2022 by biosimilars, which is a developing class of generics. The savings also increased in 2024. 

Prescription Drugs Offer an Accurate Solution to Patients Suffering from Chronic Illness

Category	Market Share in 2024
Type of Prescription- Prescription Drugs (Rx)	54.2%

In 2024, the prescription drugs segment of the U.S. retail pharmacy industry is projected to hold a 54.2% market share. It will likely be driven by the increasing burden of chronic diseases, including diabetes, as well as the aging population. For example,

• Demand for prescription medications continues to rise, with 26.8 million people in the U.S. living with diabetes as of the latest data. It is hence further intensifying the need for effective treatments and management options.

Pharmacies are also boosting their services to accommodate patients with chronic diseases because of the rising demand for prescription drugs. By guaranteeing improved access to essential medications, this trend not only surges income but also enhances healthcare outcomes. To improve the entire patient care experience, pharmacists are establishing themselves as integrated healthcare hubs. 

U.S. Retail Pharmacy Market Introduction and Trend Analysis

The U.S. retail pharmacy market is a vital part of the healthcare sector, providing medications, products, and services to diverse populations. With a network of outlets like chains, independent pharmacies, supermarket departments, and online services, the industry is rapidly evolving.

Retail chains like CVS and Walgreens monopolize the market, while independent pharmacies serve niche markets. The rise of online and mail-order pharmacies is accelerated by digital adoption and pandemic-driven consumer preferences. For example,

• Rising prevalence of chronic diseases is driving increased demand for prescription drugs and over-the-counter products.
• In 2023, over 131 million people in the U.S. used prescription drugs, reflecting the sector's integral role in healthcare.
• Retail pharmacies have also diversified their services, administering over 50 million flu shots during the 2022 to 2023 season.

The integration of unique technology, such as AI-driven prescription management systems, is enhancing patient engagement and operational efficiency. 

Historical Growth and Course Ahead

Between 2019 and 2023, the U.S. retail pharmacy market recorded a stable compound annual growth rate (CAGR) of 4%. During this time, the industry has progressively shifted toward a more accessible, community-focused model of care. Today, nearly 90% of Americans now live within five miles of a pharmacy, reinforcing their role as vital healthcare access points. Pharmacies have expanded beyond dispensing medications to offering immunizations, chronic disease management, and medication therapy management (MTM), which has been shown to significantly reduce hospital admissions. Many states support collaborative practice agreements (CPAs), allowing pharmacists to co-manage conditions like diabetes and hypertension alongside physicians. As a result, pharmacists now see patients far more frequently than primary care doctors, positioning them as key players in preventive and long-term care. Additionally, services like flu and non-flu immunizations, smoking cessation aids, and medication reviews are commonly available at local pharmacies, increasing patient convenience and adherence.

Retail chains dominated in 2021, accounting for one-third of stores and prescription revenues. Companies are now prioritizing operating margins, reducing physical store footprints, and investing in digital strategies. For instance,

• Regional pharmacies, which account for 30% of shops and 15% of prescription sales, are surging due to focused local markets and tailored services, despite a 50% loss since 1980.
• The mail-order and online pharmacy segment, accounting for less than 10% of prescriptions, has gained significant traction, with Amazon Pharmacy experiencing rapid growth since its launch in 2020. 

Market Growth Drivers

Trend of ePharmacies to Boost Demand for Doorstep Delivery

Increasing demand for doorstep delivery of medical supplies is a result of some items being unavailable in nearby retail establishments or the emergence of reasonably priced alternatives. The U.S. pharmaceutical market is anticipated to rise because of surging internet usage and literacy. For instance,

• Around 89% of people in the U.S. utilize the internet. To meet the unmet requirements of patients, key firms and fresh start-ups are booming in the pharmaceutical industry.

• In October 2024, Amazon introduced 24-hour drug delivery in select U.S. cities, utilizing e-bikes, drones, and electric vehicles. The company uses AI and machine learning to streamline prescription preparation and reduce administrative errors. 

The U.S. is now much more aware of ePharmacies and e-commerce services due to the shift in healthcare from traditional to digital. 

Rising Prevalence of Chronic Diseases like Cancer to Propel Demand 

In the U.S., the most common chronic diseases include diabetes, cancer, congestive heart failure, and chronic immunological deficiencies. For example,

• The World Health Organization (WHO) estimates that 133 million people in the U.S., or nearly 40% of the population, are affected by chronic diseases. Such a demand for healthcare services and pharmaceutical products is driven by the aging population, with over 46 million people aged 65 and older in 2023. It is projected to double to 90 million by 2050.
• Over 80% of older adults suffer from at least one chronic disease, with 77% managing two or more.

While home care options like wearable monitoring devices are becoming immensely popular, the pharmaceutical sector is tackling the problem of diabetes with novel insulin formulations. A few other companies are also focusing on launching cutting-edge cancer therapies. 

Market Restraining Factors

Lawsuits and Product Recalls to Limit Market Growth

The pharmacy sector in the U.S. is grappling with increasing drug and vaccine volumes, with regulatory recalls impacting brand reputation and market growth. It is often caused due to manufacturing defects or safety concerns. For example,

• In March 2021, Dr. Reddy's Laboratories recalled batches of Atorvastatin Calcium tablets due to quality concerns.
• In July 2020, leading India-based pharmaceutical firms like Lupin, Alembic Pharmaceuticals, and Aurobindo Pharma were compelled to recall several drugs from the U.S. market. This damaged their brand images and resulted in substantial financial settlements.

The limited reimbursement landscape in the U.S. exacerbates these challenges, as patients struggle with high out-of-pocket costs for medications. The emergence of novel therapies adds complexity to regulatory and distribution systems, increasing the risk of errors and recalls. 

Key Market Opportunities

Growth of Mail-order and Online Pharmacies Creates Future Prospects 

Increasing need for convenience among customers, especially those with smartphones, is changing the pharmaceutical sector in the U.S.

• Around 92% of the population owns a smartphone (more than 307 million). Hence, it is now simpler to use digital platforms for buying medications. This tendency has been further exacerbated by the COVID-19 pandemic, which has resulted in a move toward online healthcare solutions.

Leading players like Walgreens and CVS are also enhancing their digital footprints. For example,

• In January 2024, Walgreens launched a new mobile app with unique prescription management features, improving customer experience and accessibility.

Patients with chronic illnesses further benefit from mail-order services for reliable prescription supply. For instance,

• Due to their affordable prices and convenient accessibility, around 15% of people in the U.S. are choosing online pharmacies, which suggests a change in consumer behavior and business practices. 

Availability of Personalized Medicine and Pharmacogenomics to Present Avenues  

The market for specialty medications, especially biologics for long-term illnesses, is changing the pharmacy landscape in the U.S. It is providing retail pharmacies with substantial growth prospects. For example,

• Specialty pharmaceuticals dominated the pharmaceutical industry in 2023, accounting for 55% of all U.S. medication spending. As biologics like Humira precisely target disease pathways, they are highly sought after.

Pharmacies may now provide individualized treatments based on a patient's genetic predispositions due to developments in pharmacogenomics and personalized medicine. Walgreens and CVS Health, for example, have teamed up with genomics firms to maximize the effectiveness of medications for the treatment of chronic illnesses.

The growing need for high-touch services like patient education and adherence support is driving the specialty pharmaceutical market. It is also establishing retail pharmacies as essential providers of individualized and effective treatment. 

Regional Insights

Across the U.S., regional trends in the retail pharmacy market reflect differences in population needs and healthcare access. In the Northeast, cities like New York and Boston lead in pharmacy spending, with a strong focus on specialty medications and chronic disease care. This region is expected to remain a major contributor due to its high demand for integrated pharmacy and healthcare services. In the Midwest, where many communities are rural, independent, and mail-order pharmacies are crucial. Over half of rural pharmacies are independently owned, and nearly a quarter are more than 20 miles from the nearest alternative. The South is seeing steady growth in both branded and generic drug use, largely driven by an aging population and a high rate of chronic illnesses. However, the region also faces rising pharmacy closures, especially in underserved Black and Latino neighborhoods, leading to “pharmacy deserts” and reduced access to vital health services.

Competitive Landscape for the U.S. Retail Pharmacy Market

A few large corporations, such as CVS Health Corporation, Walgreens Boots Alliance, Inc., and Cigna, control most of the pharmaceutical industry in the U.S. These firms are extending their businesses by opening both physical pharmacies and online pharmacy platforms.

Some of the organizations are enhancing medication accessibility and improving drug distribution efficiency through technological innovations. These include telehealth services, digital prescription management, and innovative inventory management systems.

Healthcare organizations are also forming strategic partnerships with other providers and technology firms to extend their product offerings and improve service delivery. These strategies are enhancing innovation and helping companies to respond more effectively to consumer needs, ultimately aiming to improve healthcare outcomes nationwide. 

Recent Developments in the U.S. Retail Pharmacy Market

• In October 2024, Arkansas-based Walmart introduced home delivery of prescription drugs and medication refills in six states, namely, Arkansas, Missouri, New York, Nevada, South Carolina, and Wisconsin. It is now offering same-day delivery and 30-minute or less delivery options.
• In May 2024, Rhode Island-based CVS Pharmacy introduced the Well Market brand for snacks, beverages, and groceries. It offers nutrition, bold flavors, recyclable packaging, and dietary options, including vegan, gluten-free, and keto options.
• In April 2024, Illinois-based Walgreens extended specialty pharmacy services to include gene and cell therapy, with a Pittsburgh-based center, enabling independent collaboration with payers, health plans, and pharma.
• In February 2024, Iowa-based WinnMed Pharmacy launched a retail pharmacy in Decorah, U.S. It provides services such as vaccinations, over-the-counter drugs, prescription filling, education, and medication adherence packaging.

U.S. Retail Pharmacy Market Report Scope

Attributes	Details
Historical Data/Actuals	2019 – 2024
Forecast Period	2025 – 2032
Market Analysis Units	Value: US$ Mn, Volume: As applicable
Key Zone Covered	West U.S.  Midwest U.S.  Southwest U.S   Southeast U.S.  Northeast U.S.
Key Market Segments Covered	Type of Pharmacy Type of Prescription Product Type Application Customer Segment Zone
Key Companies Profiled	CVS Health Walgreens Boots Alliance Walmart Inc. Rite Aid CarelonRx Costco Wholesale Cigna Humana United Health Group Publix Albertsons Companies BrightSpring Health Services PANTHERx Rare Pharmacy Ahold Delhaize Centene
Report Highlights	Market Forecast and Trends Competitive Intelligence & Share Analysis Growth Factors and Challenges Strategic Growth Initiatives Future Opportunities and Revenue Pockets Market Analysis Tools
Customization and Pricing	Available upon request

U.S. Retail Pharmacy Market Segmentation

By Type of Pharmacy

• Chain Pharmacies
• Independent Pharmacies
• Hospital Pharmacies
• Mail Order Pharmacies
• Online Pharmacies

By Type of Prescription

• Prescription Drugs (Rx)
• Over-the-Counter (OTC) Drugs 

By Product Type

• Generic Drugs
• Branded Drugs

By Application

• Cardiovascular
• Central Nervous System
• Gastrointestinal
• Oncology
• Others

By Customer Segment

• Pediatric     
• Adults
• Geriatric

By Zone 

• West U.S. 
• Midwest U.S. 
• Southwest U.S  
• Southeast U.S. 
• Northeast U.S. 

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