Dispute over commission keeps drugs off the shelves

Published: 28 November, 2013 00:58 IST | Salil Urunkar |

Pharma company's decision to reduce the commission margin for stockists is proving costly, as city's chemist association has allegedly called for a 'ban' on their drugs

The city is facing a shortage of some drugs due to a ‘ban’ allegedly imposed by the Chemist Association of Pune District (CAPD). Retailers allege that a particular pharmaceutical company, which is bearing the brunt of the boycott, had reduced the margin of commission paid to stockists recently, and that has not gone down well with the CAPD. 

This is the second incident reported this year wherein the association has allegedly illegally banned sale of medicines of a pharma company over the dispute of commission being paid to stockists.

Viraj Bhaskar Taware, a social activist said, “My father needs to consume vitamin capsules daily, but since the last few days I am not able to get it. Whichever medical shop I have enquired with said that their stocks have exhausted.”

A retailer, on condition of anonymity, said, “We have to turn down many customers everyday due to non-availability of drugs of a particular company. We have to face the whims and fancies of the association, which has recently started this practice of banning sales of drugs manufactured by particular companies that do not agree to an increase in the commission percentage.”

Commission war
Drugs of the manufacturing company, which has been banned, has a turnover of about Rs 5 crore every month from the city. There are six stockists who supply these drugs to the retailers/medical shops across the city.“The pharma company used to give 10 per cent commission to the wholesalers, which has now been reduced to 6.5 per cent. Similarly, the retailer commission has been reduced to 11.5 percent from the earlier 20 per cent by the company,” the retailer added. A few days ago, the retailer said, the association imposed a similar ban on a company, which manufactures medicines related to diabetes, asthma and blood pressure control.  The ban was revoked only after the company agreed to restore the commission back to the earlier levels. 

The Other Side
Vijay Changediya, secretary, CAPD, denied all allegations made by retailers. He said, “We haven’t given any such instructions to anyone.”

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