Pharmaceutical trade is the vital link between the 10,000 odd pharma companies and several millions of  patients who depend on the trade for their regular supply of medicines in India. It is this  community of 6 lakh retail chemists and a few thousands of wholesalers  which ensures the access to life saving and essential medicines for people in thousands of villages and towns throughout the country. Because of their critical role in this business of dealing in medicines, the trading community has to be responsible and accountable to the society at large. But, the conduct of the pharmaceutical trade has not been up to the mark for the last thirty years or more especially after they formed themselves into an organized force. Although their display of strength  and arrogance  has been largely against the pharmaceutical companies in the past, to a great extend such actions used to get affected the patients as well. Trade’s boycott of certain products, forcing pharma companies to obtain NOC for appointing new stockists and other pressure tactics have been rather frequent in recent times. But the pharmaceutical companies have been rather meek in taking any legal action against these unfair trade practices of the trade body so far.   

Now, the whole distribution scene is set for a major change after the Competition Commission of India (CCI) decided to lay some ground rules for this business for the first time. The CCI in its order in February last directed the AIOCD to file an undertaking that its practices regarding grant of NOC for appointment of stockists, fixation of trade margins, collection of PIS charges and boycott of products of pharmaceutical companies are discontinued within 60 days from the date of the order. Any trade member having a wholesaler's license can directly approach manufacturer for supply of medicines and denial of drug supply to any wholesaler would amount to restrictive trade practice and will be in violation of Drug Price Control Order and Competition Act attracting penal action. The Commissioner of Food & Drug Administration Maharashtra has already taken the first step in enforcing the new system in the country by directing the drug companies in this regard. It is possible that other states may follow Mahrashtra soon. But the manufacturers are not very happy with supplying drug stocks directly to wholesalers although they welcomed the discontinuation of the NOC system. So far, they had to deal with only a few hundreds of stockists and distributors but now they have to satisfy a large number of traders with small requirements. This may cause some inconvenience and additional costs to manufacturers initially but in the long  run this arrangement should lead to a healthy competition among traders resulting in lower prices to patient community.