A study conducted by the Public Health Foundation of India (PHFI) has found that over dependence on support from state governments and poor supply chain management are main reasons for the failure of the department of pharmaceuticals' (DoP's) ambitious ‘Jan Aushadhi Scheme’, launched by the department way back in 2008.

Against a target of more than 1000 stores, just 182 Jan Aushadhi stores have been opened across 16 states/UTs, out of which only 111 stores are in operation as on 13.07.2015. As the scheme was progressing at a snail's pace, the PHFI was asked by the DoP to study the scheme and suggest remedial measures.

The PHFI in its report pointed out that over dependence on support from state governments; poor supply chain management; non-prescription of generic medicines by the doctors; state governments launching free supply of drugs; and lack of awareness among the public are mainly responsible for the scheme not being successful.

In the report, the PHFI recommended to the government to take several remedial measures for implementation of the scheme. They include increasing the number of products from 361 to 504 medicines and 161 surgical and consumable items; improving the supply chain mechanism through appointing distributors and C&F agents in different states; increasing the number of functional stores; strengthening the operating agency i.e., BPPI through augmenting of manpower; and relaxation in the eligibility criteria of operating agency for Jan Aushadhi Stores (JAS).

The ‘Jan Aushadhi Scheme’ was launched by the government to make available quality generic medicines at affordable prices to all, especially the poor, throughout the country, through outlets known as Jan Aushadhi Stores. Under the Jan Aushadhi Scheme, the state governments are required to provide space in government hospital premises or any other suitable locations for the running of the stores.

Bureau of Pharma PSUs of India (BPPI) is to provide one-time assistance of Rs. 2.50 lakhs as furnishing and establishment costs, start up cost for setting up a Jan Aushadhi Outlet. Any NGO/charitable society/institution/self help group with experience of minimum 3 years of successful operation in welfare activities, can also open the store outside the hospital premises.

A margin of 16 per cent on the sale price is built in the MRP of each drug. In addition, the JAS are eligible for incentive linked to sale of medicines at 10 per cent of monthly sales amount, subject to a ceiling of Rs. 10,000 per month for a period of first 12 months. In case of stores opened in North Eastern states and other difficult areas i.e., naxal affected areas/tribal areas etc., the rate of incentive is 15 per cent of monthly sale amount, subject to a ceiling of Rs. 15,000 per month.

According to sources, all out efforts are on to open at least 200 more Jan Aushadhi stores during this financial year 2015-16.