The All Kerala Chemists and Druggists Association (AKCDA), the state unit of AIOCD, is planning to demand the state government to refrain Neethi retail medical shops, run by co-operative sector under Neethi medical scheme, from competing with the private retailers in the open market.

In a state committee meeting to be held on August 9, the Association will list out the Neethi retail stores run by co-operative banks, operating outside government hospital premises offering 10 to 40 percent discount on MRP, according to sources. AKCDA will then submit the list to the government seeking action against them.

In a meeting with the state health and co-operative ministries to find a solution to the shortage of drugs in Neethi medical stores, the AKCDA asked the government to refrain from direct engagement on wholesale procurement and licensee activities. The dissonance between the trade and the Kerala State Cooperative Consumers' Federation (Consumerfed), which runs the Neethi Medical Scheme, resulted in serious drug shortage in Neethi medical retail outlets in the current monsoon season.

The AKCDA sources maintained that the supply to these retail shops has been restored as per the negotiation with the state government though the Association could not assure co-operation with the scheme for a long term. They said that the Association is ready to extend support for discount supply through government hospitals and distribution centres in public hospital premises. They alleged that the scheme is being misused as the primary societies and co-operative banks are setting up retail medical shops in open market with discounted price, creating threat to the private retail medical shops.
"If the government continues to avoid our demand to shelve out the discount shops from open market, we shall be forced to instruct the manufacturers to abide by the contract between industry and trade in the state," A M Mohan, President, AKCDA told Pharmabiz. As per an agreement between the trade and the industry in 1999, the manufacturers should limit their direct supply in the state to institutions for free drug distribution or for their own consumption.

It is to be noted that the drugs control department of the state has booked a few distribution companies under refusal of sales clause for not supplying drugs to the Neethi stores. According to sources, the government has curbed such practices after discussions with Association. Sources alleged that the Association restrains the distributors from supplying adequate quantum of drugs to the Neethi scheme and has refused to provide three months credit which is granted to every other retailer in the state.

Meanwhile, the officials from Consumerfed informed that the traders have resumed supply to Neethi to some extend after the talks with the government. Currently 157 Neethi stores are run under the scheme in which the Consumerfed directly handles 22 retail outlets. As per the official website of the federation, plans are on to commence about 50 more directly run Neethi medical stores in various parts of the state.

The Neethi scheme, for the wholesale and retail sale of medicines by establishing medical stores by Federation, was approved by the state government and has been in existence from November, 1 1998. For the distribution of medicines as per requirement of the Neethi Stores, the federation has set up three Neethi warehouses, one each at Thiruvananthapuram, Ernakulam and Kozhikkode.