What would be the Trade Margin Under New Pharma Policy? - Progressive Life Care

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What Would Be The Trade Margin Under New Pharma
Policy?
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Trade Margin New Pharma Policy
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The government plans a new pharmaceutical
policy in an attempt to make drug affordable to
everyone. According to the policy draft, the
trade margins will be fixed for drugs by the
government. Currently, the NPPA or National
Pharmaceutical Pricing Policy is fixing the trade
margins for specialized medical devices, e.g.,
cardiac stents, orthopedic knee implants. What
was the need for making a clear and detailed
pharmaceutical policy? The market was governed
by several unreasonable bonus offers and
disproportionate trade margins by distributors,
retailers, and wholesalers. It was adversely
affecting the industry per se and the interests
of consumers as well.
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THE NEW PHARMA POLICY IS THE MOST-TALKED
TOPIC It is crucial to know about the
nitty-gritty of the pharmaceutical policy.
Experts say that one should be able to
distinguish between authentic and fake things
prevailing in the market. There are so many
speculations are going around. Amongst the most
rampant rumors, loan license manufacturing,
fixation of trade margin and banning the
contracts. What are the trade margin regulations
in the backdrop of new pharma policy? Here are
some salient aspects. Trade margin is a complex
phenomenon. The debate is still going on to fix
it. For different drugs, different trade margins
were fixed.
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DPCO OR DRUGS UNDER PRICE CONTROL Wholesaler
margin is fixed at 8 percent, and retailer margin
is fixed at 16 percent. The margin is applicable
for generic as well as branded drugs. FOR OTHER
DRUGS NOT UNDER PRICE CONTROL In case of all
branded items and branded generic items, the
wholesaler margin is fixed at 10 percent, and the
retailer margin is 20 percent. For generic
items, the wholesaler margin is 15 percent, and
the retailer margins are 35 percent. The
calculation of all margins will be done based on
the MRP of drugs or trade rate. The policy is
still under review, and there may be some change
in the coming times.
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Conclusion The proposed regulations will create
a level playing field for sure. The Department of
Pharmaceuticals expects consultation and comments
on the draft. It is also an attempt to make the
voluntary code of conduct a mandatory requirement
so that the malpractices can be avoided. When
illegitimate incentives and benefits are offered
to the doctors, there is always a risk of
recommending a specific brand by them. It is not
in the long-term interest of the pharma business.
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