In an initiative to survive the crisis created by the introduction of DPCO-2013 in which the trade margin has been slashed, the trade reforms committee (TRC) of the Tamil Nadu Chemists and Druggists Association (TNCDA) has decided to approach the manufacturing companies with a request to retain the old trade margin, said Kovai Kasi Raman, chairman of the committee.
“We are making the demand to the manufacturing companies to retain the old margin. We are going to request all the companies in the country to maintain the status quo in the case of trade margins,” he said.
According to him the traders are losing their income, but the manufacturers' profit is going high in the case of NLEM formulations. Those products whose ceiling prices were less than the new drug price control order, the companies have increased the prices of their products but reduced the trade margin. This is just like a ‘double profit’ for the manufacturers, whereas a big loss to the traders.
Kasi Raman, who is also an EC member of AIOCD, said a company that was producing a combination drug of Amoxicillin and potassium clavulanate tablets was selling a strip of it for Rs.99. But after the introduction of new DPCO, it has increased the price to Rs.108.90 and reduced the trade margin from the earlier rate. This shows that the new DPCO is helping the manufacturers, and spoiling the traders. He added that several wholesalers had vanished from the field due to high cost of operation and profit loss.
The wholesale leader in Coimbatore further said that in his city alone more than three wholesalers have stopped business due to heavy loss and high cost of operations. All the formulations made out of the 348 molecules, the trade margin for the formulations has been reduced to 10.73 per cent from the earlier 10 to 20 per cent and for retailers the margin has been brought down to 13.6 per cent from the previous 22 per cent, he said.