Navigate the Pharma World: How to Start Your Pharmaceutical Distribution Journey in India"
Drug distribution is a critical link in the healthcare supply chain, with most pharma manufacturers ensuring that their healthcare products and services reach pharmacies, hospitals and patients in remote locations in India on time and that medicines are delivered safely and efficiently.
But distributing medicines safely and efficiently requires effectively creating distribution networks, so that drug distribution can be carried out successfully for the smooth functioning of healthcare systems.
The importance of drug distribution in the healthcare supply chain in a large country like India has increased significantly in today's times as the demand for healthcare services from India's large population is increasing since the outbreak of a pandemic like COVID-19. Additionally, the continuous launch of new and affordable medicines as well as the growth of government healthcare initiatives have created significant opportunities for distributors.
This has led to increased investment in healthcare infrastructure. This provides opportunities for new pharma distributors to enter the drug distribution business and has immense potential for long-term profits.
Understanding the role of a pharmaceutical distributor in the healthcare industry sector
If we try to understand the role of pharma distributors in the healthcare industry in simple language, a drug distributor can be a person or firm that purchases pharmaceutical products from the drug manufacturing company at a certain profit margin and then distributes them to healthcare providers, such as pharmacies, hospitals, and clinics.
In which their main responsibility is to ensure efficient distribution of healthcare products by storing them in compliant warehouses and then delivering these products to various healthcare stores.
Step-by-Step Process to Start a Pharmaceutical Distribution Business in India
a) Research on the market:
To set up a pharma distribution business in this competitive market of the pharma industry, you should analyze the pharmaceutical market demand in the region where you are going to start the business, try to understand healthcare needs, and identify profitable opportunities.
The best way for a pharma distributor to analyze pharmaceutical market demand is to talk to their local doctors and chemists to find out about prevalent health conditions, demand for specific therapeutic categories (such as antibiotics, chronic disease medications, or over-the-counter drugs).
b) Legal Requirements and Licenses:
Friends, to start a pharma distribution business in India you have to follow strict laws and proper guidelines given by the State Drug Control Authority and other regulatory bodies. We are going to explain in detail about applying for the licenses required to start a pharma distribution business.
Requirements for Wholesale Drug License in India:
- Shop and Premises (Can be owned or rented)
- Area required: Should be minimum 10 sq.mt
- The floors and walls should be made of cement.
- The roof of the premises should be made of concrete.
- Technical person: Should be a pharmacist or a person experienced in the pharmaceutical field.
- Refrigerator and/or air conditioning for storing essential medications
- Other details as may be asked by the licensing authority, if required
How to Apply
Friends, we have discussed all the required documents below, which you can check carefully. And when you fulfill all those requirements and document process, you can use the online or offline application process to submit the file. But if online file submission facility is not available in your state, then you have to submit your document file by visiting the licensing authority office.
And once you successfully submit the document file to the state licensing authority, you will be informed about the date and time of the premises inspection by the licensing authority through phone, email or letter.
Inspection:
Usually a drug inspector is appointed by the State Government as the inspection person who issues the bulk drug license. The person or firm applying for bulk drug license to start pharma distribution business has to properly maintain the record of all the documents, facilities and technical person details etc. in a file and then submit it to the State Drug Authority office. If all the documents, facilities and technical person details are found correct, then the bulk drug license will be issued after inspection by the drug inspector.
Documents required for submission of Wholesale Drug License:
- You will have to fill in the prescribed Form 19 along with the application form and all other information and submit it to the District Drug Inspector/Drug Sales Authority office.
- While selecting the premises you need to check that the area required should be minimum 10 square meters, 15 square meters space is required to obtain a pharmacy/wholesale and retail license, and the minimum height of the premises should be 8’2”, with brick walls and plaster and cement flooring.
- The application you have to make has to be made in Form No. 19 only and that too with additional information.
- In the list of required qualification documents, you have to provide Pharmacist Registration Certificate or Experienced Person Certificate or Appointment Letter from competent person.
- The fees charged will be of Rs. 3000/- (For biological and Non Biological)
- Copy of address proof
- Rent agreement or ownership proof if the premises is taken on rent
- A photocopy of the purchase bill of the refrigerator purchased for medicine storage, along with its complete address, must be submitted
- You have to submit the photocopy of the Educational Qualification Certificate while applying for Educational Qualification of EP/Pharmacist.
- Photocopy of certificate as document of date of birth
- Affidavit of Partners/Proprietor/Directors
- You need to submit 3 copies of layout plan/blueprint of the premises with signatures.
- Your premises should have adequate storage facilities with necessary amenities like glass door cabinets, pallets, racks.
- Affidavit of AP/Pharmacist will be required.
- Partnership Deed Document for Partnership Firm
- If your firm is registered under private registration then you have to provide registration firm receipt and list of directors along with address proof, article of memorandum of association etc.
Qualification & Requirements for Technical Person:
- The person should be a pharmacist registered under the State Pharmacy Council or
- Then after graduation the person has to work in any registered bulk drug licensed firm in which he/she must have at least one year experience and the required documents include his/her bank salary details, appointment letter, experience letter, and resignation letter.
Must apply Goods and Service Tax Identification Registration:
If the annual turnover of your business is less than 40 lakhs, then you can manage without taking GST number. But as your wholesale drug business grows, many parties may like to buy products from you on bill. Therefore, we would like to advise you that you must apply for Goods and Services Tax (GST) identification number. To get GST number, you can contact your nearest chartered accountant.
Partnership with a reputable sourcing and supplier
Finding the right drug manufacturer for a pharma distributor may require a little effort initially. However, it is not that difficult as in today's modern times they can be accessed through online medium. Also, pharma trade shows are held in every state. Where you can get a chance to meet many reputable manufacturers.
But when selecting a reputable manufacturer, you need to ensure a few things: Do they have a manufacturing license to make the drug. Do they meet regulatory standards such as GMP (good manufacturing practice). And Do they have a track record of quality production.
Setting up your distribution infrastructure correctly
Friends, the use of medicines is directly linked to health, hence a pharma distributor must ensure a well-organized warehouse, proper storage, inventory control and easy access to products as well as manage the cold chain for temperature-sensitive drugs to maintain the efficacy of pharmaceutical products.
If you have a bigger budget, consider building your own team
If you have a good budget to start your business, we would like to advise you not to try to do all the work yourself. To run a pharma business smoothly, hire an efficient sales team, logistics experts, and customer support representatives. The sales team is responsible for building relationships with pharmacies, hospitals, and healthcare providers, and logistics personnel ensure smooth product storage, handling, and timely delivery.
Build a great marketing and sales strategy the smart way
For any business, a smartly crafted strong marketing strategy and sales strategy that is a bit different from other businesses in the market can take that business to new heights. If we talk about pharma distributor sales and marketing strategy, it should revolve around hospitals, clinics, and pharmacies, researching their specific needs, and offering your pharmaceutical products and services according to their requirements.
Although the drug distribution business still operates mostly offline, internet access has grown significantly in today’s modern world and can be used to reach healthcare professionals and institutions.
As a pharma distributor my most preferred way is to use digital marketing which helps me to add more and more customers to my business. So if you are also a pharma distributor, you can generate leads by running PPC campaigns through email marketing, Google ads etc. which can prove to be helpful in reaching your business to doctors, chemists, healthcare professionals in remote locations.
Financial Planning and Financing for Your Business
As a pharma distributor, when you start your drug distribution business, you have to decide how much you want to invest according to your business budget, as you have to consider the costs of equipment, drug license, GST registration, and warehousing and logistics infrastructure to start the business. Other costs may include cold chain equipment for temperature-sensitive drugs, employee salaries, and transportation costs.
Now let's talk about potential financing sources for starting a medicine distribution business. Friends, in today's modern era, it has become quite easy to get a loan for business and now the Government of India provides subsidies and grants through schemes such as MUDRA loans and MSME funding designed to support small and medium enterprises.
Conclusion:
Starting your pharmaceutical distribution journey in a large country like India can be a rewarding and exciting journey for an entrepreneur. However, this journey requires careful planning, which will include conducting market research, efficient storage, creating a strong logistics network, obtaining necessary licenses, setting up compliance infrastructure, and maintaining strong partnerships with manufacturers. Also, the journey of any business is full of ups and downs, so you must be determined and patient.