The pharmaceutical companies who make payments like 'PIC fees' to the chemists and druggists association for distribution of their products in Kerala may be blacklisted from selling their products in the state. The state government is preparing a law under which both giving and taking such fees under any name will be a punishable offence.

The Kerala government's action comes in the wake of allegations that the All Kerala Chemists and Druggists Association (AKCDA) members are using the 'PIC fees' baton as an effective tool to browbeat the pharma companies for favours both in cash and kind.

The Kerala government has already issued a warning to both the AKCDA and the pharma companies in this regard. The matter became a major issue when an MLA, Sunil Kumar, raised the issue in the Assembly on September 14. Terming the system as equivalent to running a parallel government in the state, the Kerala Health Minister Sreemathi Teacher announced that giving and taking TMC (trade margin certificate) fees is illegal.

When contacted, Sunil Kumar MLA said, "The government will not allow such illegal activities in the state. The government is preparing a law under which giving and collecting fees like TMC or PIC will be illegal. The companies who pay such fees will be blacklisted from distributing their products in the state."

The pharma companies who wanted to distribute their products in Kerala, for that matter in other states too, have to obtain a no objection certificate (NOC) by paying Rs 2000 from the trade bodies. Without this certificate, no retailer will dispense the products. When there was objection to NOC under MRTP Act, the name was changed to LOC (letter of cooperation). Then again, the name was changed to TMC. Now that the government has announced action against collecting TMC, the association has once again changed the name to PIC (product information certificate). The Association collects the fees in the guise of giving advertisement about the product in its bulletin.