Drug retailing at standstill

Latest directive from regulator to hit dealer margins
Drug retailing at standstill

The latest directive of the Drug Price Control Order 2013 has created a ‘headache’ for drug and pharma retailers and that’s because it would lower their profit margins, as well as adversely impact their supply chain. This directive, which would apply within 45 days of notification, would lower prices of 350 medicines and drug manufacturers are also required to replace older stock in their distribution network. No doubt, patients would benefit from this move, but the industry body representing seven and half lakh vendors - The All India Organization of Chemists and Druggists (AIOCD) highlighted that dealer margins
would dip to 13.75 per cent, from 20 per cent earlier.

In addition, AICOD issued a statement, which said, “We have invited representatives from all the states to discuss single point issue of margins.” Apart from that, dealers also highlighted the logistical and supply chain challenges. Bhushan, a drug retailer at Charmwood Village, Faridabad, said, “We have received price-related order for only 30- 35 medicines and are also getting irregular supplies of medicines.” Striking a similar note, D G Shah, Secretary General, Indian Pharmaceutical Alliance (IPA), said, “Patients may have to grapple with temporary shortages of medicines.”

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