The All Indian Origin Chemists and Distributors Ltd (AIOCD Ltd), the company floated by All India Organisation for Chemists and Druggists (AIOCD), is planning to float 10 state wise pharmacy retail companies by January 1, 2008. The move comes as the part of AIOCD's plans to set up 30 companies over the country within two years.
The 12 state affiliates of AIOCD, in West Bengal, Bihar, Orissa, Assam, Tamil Nadu, Rajasthan, Delhi, Himachal Pradesh, Punjab, Hariyana, Gujarat and Madhya Pradesh has informed the national body that they are ready to float retail chain pharmacies in the respective states soon. Out of these states, 10 affiliate bodies will set up limited firms by January 2008, according to sources from the organisation. The state affiliates of AIOCD in Maharashtra and Kerala have already announced to roll out their companies by April 1, 2007.
In a bid to ensure adequate funding for these plans, the organisation targets to collect Rs 20 crore through equity shares, for which the formal procedures are currently on the way, informed J S Shinde, general secretary of AIOCD. The AIOCD Ltd will act as the supervising and nodal agency for the companies under the state associations.
The AIOCD will sign an agreement with Accenture, the US based leading business consulting company, by the second week of March to ease the procedure of launching state wise companies. The organisation has already appointed Ernst & Young as consultant to guide small drug retailers through the transition process.
"Rolling out 30 companies in various parts of the country will take a minimum of four to five years, if we are going with a single consultancy service. With the new tie up, we would be able to cut down the time consumed for launching the companies by assign half of the job to Accenture, which will make the process much easy," Shinde told Pharmabiz. The organisation envisages setting up of state level retail chains in all the states and some of the union territories of India.
The company has initiated talks with the major pharma companies for business deals by the second week of March 2008. The organisation has also enlisted around 85 pharmaceutical companies including the major foreign multi-nationals and the Indian multi-nationals and plans are to present the working pattern of the trade company through presentations and discussions.
The board of directors with a management team for operations will be selected within three months after the commencement of operations. The company will appoint five directors to take charge of operations by the time. The Organisation has already appointed A N Mohan, president, AIOCD as the chairman of the limited company, where as Promod Lele, CEO, P D Hinduja National Hospital, Ravi Sawant, vice-president of the Mumbai Cricket Association and S W Deshpande, Director General of All India Drug Control Officers Confederation (AIDCOC) were being appointed as independent directors.
According to Shinde, the AIOCD Ltd will be headquartered at Mumbai, along with the 12,000 sq ft office of MSCDA Ltd. The MSCDA Ltd, the pilot project of the largest chemists' organisation in India, is ready to launch with an investment of Rs 50 crore, in which Rs 35 crore has been collected as equity capital and Rs 15 crore as preferential share capital. The financial working capital for MSCDA Ltd will be provided by Bank of India.
MSCDA Ltd is envisaged to hit Rs 7200 crore worth of business in an year in Maharashtra within the first two fiscals of operation, which will be 80 per cent of the Rs 9000 crore total drug market in the state, added Shinde. He said that the state branch is expected to reach Rs 240 crore target by 31st March 2008 and to grow towards Rs 600 crore business by 2008-09 fiscal.
As Pharmabiz reported earlier, the AIOCD has initiated a joint venture company, AIOCD Pharma AWACS, with the Chennai based Medi-Infotec, a health Information Technology (IT) services provider to launch a market surveillance product. The product is to be launched by current month, according to the sources related to the development.