A joint meeting of the All India Organisation of Chemists & Druggists (AIOCD) office bearers and top executives of GSK and Novartis India Ltd will be held on June 18 in Mumbai to resolve the crisis due to traders’ boycott of these companies, it is learnt.
The pharmaceutical trade, led by the AIOCD had commenced countrywide boycott of products of GSK and Novartis since May 28 for violating the agreements between the companies and the trade body.
Top office bearers of the AIOCD affiliated traders organizations’ in South India from the states of Kerala, Karnataka, Tamil Nadu, Andhra Pradesh and Pondicherry had met in Chennai two days ago to take stock of the situation. Sources claimed boycott is almost complete with about 90 per cent traders participating in these states. Boycott is on in many north Indian states, including Maharashtra, Gujarat, Rajasthan and Delhi.
Since most of the retail traders normally take stocks for the next month during the last week of every month, drugs of these companies are currently available in medical shops. However, if the boycott lasts to the end of this month, shortage of medicines from these companies will be felt in the retail outlets, by early next month. The traders are not taking fresh stocks, including bulk hospital supplies since June 28. As per the plan, if the companies fail to agree to the demands, retailers will stop selling the remaining stocks of these companies from retail outlets from next week.
The present boycott is based on issues like supplying drugs without absorbing the CST burden (excluding excise duty), credit period and promotion schemes. AIOCD says while other companies offer 21 days credit, these companies demand payment within 12 days. These companies also come up with sales promotion bonus schemes, which are unaffordable and unmanageable for small retail chemists.
AIOCD alleges the companies were violating trade agreements with 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 violating the terms after sometime.