The Bengal Chemists and Druggists Association (BCDA), the West Bengal based affiliate of All India Chemists and Druggists Association (AIOCD) is planning to float a company for organised pharmaceutical distribution soon, following the business model of Maharashtra and Kerala trade bodies.

The proposed BCDA Ltd. will initially work out the business model of Pharma Combines Kerala Ltd., the initiative of All Kerala Chemists and Druggists Association (AKCDA) to supply generic drugs in a lower price by eliminating the middlemen from drug supply chain. The business operations will eventually evolve into organised distribution set up similar to the function of MSCDA Ltd., the initiative of the Maharashtra State Chemists and Druggists Association (MSCDA), to counter the threat of organised retail chains. The details of the initiative would be finalised in a meeting of the state body at Darjeeling on 29th and 30th of January 2007, it is learnt.

The Association envisages launching the company with an investment of Rs 15 crore to Rs 20 crore, and is planning to leverage Rs 10 crore as share money from members. With strength of 33,000 members in the state, the Association is planning to bring in 25,000 members to its new venture, informed Bipin Mehta, president, BCDA. The Association would seek support from banks for the rest of the investment. He informed that the supply of medicines would soon be routed through the new company.

"The idea is on budding stage at present, and we are gathering information from the companies which are already established by AIOCD affiliates. We are discussing the matter in different levels of the local affiliates and members and the decision will be put forward for approval of the state executive committee meeting by the end of January," Samir Ranjan Das, General Secretary, BCDA told Pharmabiz. He added that the Association is planning to launch the company within 31st March 2007 and will commence operations by the beginning of next fiscal. The company will have a target of Rs Five crore to Rs 10 crore business in the initial stage, said Samir.

The BCDA's move to launch a limited company follows the agenda of AIOCD to switch over towards corporate from association. The executive committee meeting of AIOCD, conducted on mid-December, has approved the formation of AIOCD Ltd. as a service arm for the state level companies formed under its affiliates. The AIOCD Ltd., the flagship company of the trade organisation, will commence operations by April 2007, according to sources.

As Pharmabiz reported earlier, the MSCDA and AKCDA, affiliates of AIOCD in Maharashtra and Kerala respectively, has announced their plans to establish limited companies to reduce the price of essential medicines and to counter the increasing threat of organised retail chains.