| TOKYO, June 1
TOKYO, June 1 Deregulation of over-the-counter
drug sales in Japan took effect on Monday, opening the $12
billion market to convenience stores and supermarkets in a move
that could spur fierce price competition.
But analysts and industry players said most consumers were
unlikely to find cold medicine or aspirin at their neighbourhood
convenience stores anytime soon, citing the high economic hurdles
of selling nonprescription drugs at such smaller shops.
"I don't see an immediate impact from deregulation," said
Akihiro Hayashi, a retail analyst at Ichiyoshi Research
In what was billed as the first major change in Japan's
regulation of drug sales in half a century, the government has
introduced less rigorous qualifications to sell most OTC drugs,
which only licensed pharmacists had been previously allowed to
Japan's OTC drug market is estimated around 1.17 trillion yen
($12.4 billion) for the year that ended in March, data by market
research firm Intage shows.
Deregulation is expected to help new entrants as they can now
hire lower-paid staff to do most of the sales work done
previously by pharmacists.
Given their sheer number - over 40,000 nationwide - and their
24-hour operations, convenience stores have been seen as one of
the biggest threats to drug stores. Convenience store chains also
see drugs as one of the few promising untapped sales categories.
But analysts said it would be hard for convenience stores,
whose workforce is made up primarily of part-time workers, to
secure shop clerks who have the appropriate sales licence and to
generate enough sales to pay for the extra fees for licence
"Convenience stores lost in this round of deregulation in
that drug sales still require a license," said Kazunori Tsuda,
retail analyst at Daiwa Institute of Research.
Convenience store chains also said drug sales were unlikely
to spread quickly among their stores, though they said potential
demand is strong for cold medicine and other drugs during odd
Industry leader Seven-Eleven started selling OTC drugs at one
of its stores in Tokyo on Monday, stocking a shelf with nearly
"We are expecting further deregulation in the future, and we
are preparing for that," said Nobuyuki Miyaji, a spokesman for
Seven & I (3382.T), which operates Seven-Eleven.
(Reporting by Taiga Uranaka; Editing by Chris Gallagher)