The Karnataka Chemists & Distributors Association (KCDA) has demanded a freeze on new pharmacy retail-wholesale outlets in the state and also rationalization of taxes: VAT (value added tax), GST (goods service tax) and encourage electronic filing among chemists.

The newly formed KCDA made a representation to both the Karnataka drugs control department and State Commissioner of Commercial Taxes in this regard. The KCDA demanded that before the drug license was issued by the State drugs control department, the licensing authority should insist on VAT registration of the applicant(chemist) and not the commercial certificate of the pharmacy outlet.

“VAT registration of applicants brings in total accountability. Only registered dealers pay VAT and the unregistered evade payment. Therefore, if the chemist as an applicant has a VAT registration certificate, it will bring in more transparency and reliability to the pharmacy trade,” MJ Ravindhera, general secretary, Karnataka Chemists & Distributors Association, joint secretary, All India Chemists Distributors Federation and Honorary Secretary Bangalore City Chemists Druggists Association told Pharmabiz.

With regards to GST, which is expected to be implemented from April 2010, KCDA is insisting that infiltration of pharmacy wholesalers from any other states should be prevented to sell drugs in Karnataka. This is only in the interest of the chemists here, he added.

KCDA is also in the process of creating an awareness drive to educate the pharmacy trade members on the e:filing procedures to save time and increase efficiency.

Currently, there are around 23,000 pharmacy outlets in the state. In a bid to curb the mushroom of chemist shops, KCDA has asked the State Drugs Control department to permit outlets to come up only at a distance of 200 metres in each locality.

Earlier at the Special Executive Committee meet of the All India Chemists & Distributors Federation (AICDF) in Bangalore, KCDA highlighted major issues impacting the growth pharmacy outlets. These included: stiff and unhealthy competition from the pharmacy chain outlets like Med-Plus, Apollo Pharmacy and Religare which offer discounts on medicines, credit facilities to consumers and delay payments to wholesalers.

In the long run it is difficult for the pharmacy chain business to succeed if they indulge in such damaging trade practices. The discount offer is detrimental to the health of the pharmacy chain sector. The closing down of international pharmacy chain MediShoppe in India is a case in point, said KCDA general secretary.

Another problem affecting the retail and wholesale chemists is the need for quick settlements from the pharma industry for expiry dated damaged bottles encountered during transit and the replacement of cut strip of medicines on the shelves.

As a social cause to help the patient, KCDA has sent in a request letter to DCGI and NPPA to lower the maximum retail price (MRP) of life saving drugs.