Factors affecting growth of PCD Pharma business
Pharmaceutical sector first feels the heat of low margin in the year of 2013 when Drug Price Control Order (DPCO) was introduced. Before that high profit margins and MRP has attracted many other buisness professionals into pharma sector. After Drug Price Control Order, PCD Pharma sector started to change. At initial stage about 348 important drugs has been taken under drug price control. After that more and more drugs have been added in the price control slab. It is not single factor that makes PCD Pharma buisness less lucrative. Under drug price control good profit margin can be earned but many other factors are also affceting and making hard to start PCD Pharma business.
Indian pharma companies are exporting generic medicines in many countries and enjoying good profit margins in these countries that they can not earn in India and other developing countries. India is largest exporter of generic medicines to USA and earning high profit through USA market only but recently price control by American market put Indian companies under pressure. This pressure of price and margins may continue to other countries also. Dependent on the export of only these countries is not easy and marginable now. There are some other factors also affect growth and profit of pharma business, it is given as below:
Competition: This sector is one of the most competitive sector. A single doctor is attending more than 10 medical representative on daily basis and these numbers even increase at some area and segment. They all are visiting for prescibing his company’s pharma product. Sometime pharma companies make pressure to increase sales then sales person try to convince doctor with any possible way (ethical or nonethical) to complete his sales target. This high competitive environment makes harder in pharma market to start new business.
Strictness of Rules and Regulations: With the development of sector, related rules and regulations become more strict with time to help growth. Indian Pharmaceutical market is increasing rapidly and will be in top position by 2020 but it still need improvement in standards according to international market. There are many new regulations are introducing on regular basis. Recently some new regulations are announced such as new pricing authority, ethic codes for doctors, Plant specification should with WHO-GMP standards etc.
International Price Control: With the increasing compliement of price control in global market, Top Indian pharma companies also start to concentrate at domestic market. This move become beneficial for domestic pharmaceutical market but at the same time it will make situation more tougher and also increase competition at higher level
Online Pharma Portals: Currently this concept is not popular in India but slowly and steadily it is making its presence in some parts and becoming popular there. We cannot ignore power and reach of online pharmacy portals. It can affect whole distribution system in pharmaceutical sector. Patients are accepting online pharmacies and In future it is going to become important tool for selling pharma products.
Investment: Business starting cost is increasing day by day in every sector. Profit is declining with the increment in investment. This makes every business even PCD Pharma business though to start.
People are still enjoying doing business in the pharma sector and earning profit margins. For persons having experience and knowledge in pharma sector, still it is lucrative and easy as it were be.