The pharmaceutical trade, led by the All India Organisation of Chemists and Druggists (AIOCD), has commenced a countrywide boycott of products of various divisions of GlaxoSmithKline Pharmaceuticals Ltd (GSK) and Novartis India Ltd for violating a few trade agreements between the companies and the trade body.
The boycott follows the decision took at the national executive committee meeting of AIOCD held in Bangalore on May 28. The traders are not taking fresh stocks, including bulk hospital supplies, since then.
AIOCD has given ultimatum to the companies to resolve the issues at the earliest. If the companies fail to solve the issues raised by AIOCD on or before June 14, the wholesalers will retrieve the stocks supplied to retailers. If the companies still fail to agree to the demands, retailers will stop selling the remaining stocks of these companies from retail outlets from June 20, AIOCD sources told Pharmabiz.
The charges leveled against the companies include issues related to supplying drugs without absorbing the CST burden (excluding excise duty). While other companies offer 21 days credit, these companies demand payment within 12 days, and for offering sales promotion bonus schemes unaffordable and unmanageable for small scale retail chemists.
Sources said these companies were reluctant to agree to the terms of the traders for sometime. Whenever such issues cropped up in different states from time to time, the companies promised to agree to the terms as part of crisis management, though they were found to again violate the terms after sometime. Since the issue has been reported from various states, AIOCD decided to enforce a countrywide boycott, said sources.