An employee of e-commerce MercadoLibre works at the company's offices in Buenos Aires, Argentina September 6, 2024. REUTERS/Agustin Marcarian

(Reuters) -Latin American e-commerce firm MercadoLibre will test the waters for online pharmaceutical sales in Brazil through its newly acquired drugstore, its local head said on Thursday, a first step in entering the country's multi-billion-dollar online medicine market.

Uruguay-based MercadoLibre, Latin America's largest company by market cap, already sells medicines online in Mexico, Argentina, Chile and Colombia, but not in Brazil, the firm's largest market.

In a call with journalists, executive Fernando Yunes confirmed recent media reports that MercadoLibre had acquired a physical drugstore in Brazil, a requirement under local law for companies selling pharmaceuticals.

Yunes said the company does not intend to build a nationwide drugstore chain. Another executive added that the goal is to allow small and medium-sized drugstores to sell in MercadoLibre's e-commerce platform in Brazil, and not to compete directly with pharmaceutical companies.

"The pharmaceutical sector is the only one in Brazil that we do not operate in. It's a sector where we see potential for improvement in access," Yunes said. "We want to be a marketplace, we want drugstores selling on MercadoLibre."

Next steps will depend on how its first drugstore performs, executives said.

MercadoLibre is also talking with Brazilian authorities to update the country's regulation for the pharmaceutical sector, which creates operational challenges, Yunes noted.

"Brazilian law was created a long time ago. We believe it needs to be modernized. This will allow pharmacies to have greater access to customers," he added.

(Reporting by Michael Susin; Writing by Fernando Cardoso; Editing by Kylie Madry and Natalia Siniawski)