Lowered drug prices increase chemists’ pain

Manufacturers were to replace existing stock with stockists with the new reduced price mentioned on labels. File photo: S. Siva Saravanan  

It was a landmark decision to bring succour to patients across the country and the Drug Price Control Order (DPCO) 2013, which came into effect on July 29, lowered prices of 348 essential drugs to bring them within reach of the consumer.

But what was to have been a panacea to consumers is now a huge problem for retailers and chemists.

DPCO order

The DPCO ordered the reduction of prices of the medicines within 45 days of the issuance of the notification and that the reduced prices be made effective on drugs already being sold in the market. Manufacturers were to replace existing stock with stockists with the new reduced price mentioned on labels.

About a dozen manufacturers, including Novartis, Sun Pharmaceuticals, Alembic, Wockhardt and Cipla, have challenged the implementation of the DPCO.

But since the notification was issued, All India Organization of Chemists and Druggists (AOCD), a body representing more than seven lakh pharmaceutical retailers, has been trying to get its members to send back stock with old prices to manufacturers.

“If they do send back the products, at least 50 per cent of their sales will be impacted. Several retailers do not have computerised operations and tabulating the new price would be difficult,” J. S. Shinde, President, AOCD, told The Hindu. “Also, we cannot tamper products in any way and have to send back to manufacturers for corrected prices”.

D. G. Shah, Secretary-General, Indian Pharmaceutical Alliance (IPA), said, “it is an unfortunate situation but patients will have to live temporarily with pockets in markets and periods during which there could be some shortage of medicines”.

“The timing could not be worse because several of these drugs are essential and the monsoon season brings outbreaks of epidemics and other diseases,” Mr. Shinde said.

He estimated that the recalled products could be in the region of Rs.10,000 crore and explained that inventory maintained was normally four months stock. Companies hold a month’s stock, while stockists and retailers hold 45-day stock each.

Mr. Shah felt the exercise was ventured into “without realising its complexity. At the very least, Rs.2,500 crore worth of goods have to be recalled.

“In volume terms, a single company would replace about a million labels — unpack, re-label and repack — in several cases manually. So it is an enormous task”.

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Printable version | Oct 20, 2021 1:41:36 PM |

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