The All India Chemists and Distributors Federation (AICDF), which claims to have a strength of more than two lakh members, will soon initiate a non-cooperation movement against two major pharma manufacturers - the GSK Consumer and Sun Pharmaceuticals - for allegedly unilaterally reducing the trade margin of the wholesalers.
AICDF sources alleged that while GSK Consumer has reduced the trade margin by 5%, the sun Pharma has reduced the margin by 1% after an agreement signed with the All India Organisation of Chemists and Druggists (AIOCD), the pioneer pharma trade organisation with over five lakh members.
The one percent reduction in margin would result in huge loss to the wholesalers, since the quantity of supplies are big enough for both the companies, said Prem Ranka, general secretary, AICDF. The revised trade margins were implemented from the beginning of January 2010.
"There are around 2000 wholesalers dealing with these companies all over India and the reduction will cause loss to each of them almost Rs 40 to 50 lakh in their turnover. We are planning to initiate a non-cooperation movement against the companies probably from March 15, since they did not give any reply to our communication on the issue," said Ranka. He alleged that the rival organisation AIOCD has some selfish motives in finalising such a deal with these pharma companies.
The federation, right from the time of its inception a couple of years ago has been complaining on the monopolistic trade activities in the sector. Various affiliates of the federation has filed complaints against restrictive trade practices of the pharma industry, which the AICDF alleges to be favouring its rival trade organisation in business.
The AICDF is in the process of setting up state affiliates to strengthen its base, he added. The federation will have two more state affiliates - in Himachal Pradesh and Punjab - by the end of March. With its presence in around 15 states, the federation is expecting to establish its regional affiliates in all the states in the country before July, 2010.
"We have more than two lakh members with us at present. With all the state affiliates formed, we will have 40 to 50 thousand more members. The increase in strength will enable us to fight for our rights with the industry and the government," maintained Ranka.