Some data on Physical Pharmacists and their relationship with their Distributors & Economics:
PTR: The price at which retailer will purchase goods from stockist or distributors is a standard Industry term. Retailers are given a discount over and above this PTR which ranges from 3-6%, the one I interacted with was a medium size Retailer and his discount ranged from 3-5%. The distributor also provides a 7-15 day credit period to the Retailer.
We compared the discount of over 20 leading branded medicines on RetailerShakti over his prevailing discount and found that RetailerShakti had most medicines on a 6% Discount, leading to total discount to the Retailer over MRP in the range of 23-24%. His distributors would offer him discount in the range of 3-5% over PTR and his total discount over MRP was 21-23%.
He seemed fine with the idea of no credit and a higher discount but had concerns over Expiry replacement, need to see how this is being handled in WB by the Company.
Then we went on to compare drug data for Generic medicines from Cipla GD, Ranbaxy GD(Generic Division) – RetailerShakti couldn’t match the discounts for most medicines that were sought after as substitutes by the larger segment of our population. For some drugs it seemed like the data on the platform wasn’t updated or a standard format was used for discounts because the difference between discounts was even north of 50% on MRP for some leading drugs from Cipla GD and Ranbaxy GD.
The Generic segment forms more than 50% of the sales of the said Retailer and higher margin here is important to him because there is no Expiry Replacement for these meds. Also their margins in this segment are more than 40% in some cases so that automatically takes care of any Inventory losses.
We couldn’t find any data on sleep inducing/related drugs and most of the industry is now not selling them online fearing Regulatory repercussions after the clarification sought from them in February.
Waiting for the results next week
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