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Govt Plans Regulation Of Retail Pharmacies

The government is planning to tighten the norms for transporting, storing and selling medicines in the country even as big corporate houses are opening retail pharmacy chains and the existing ones get corporatised.

The proposed 'good distribution practices' would make it mandatory for every retail pharmacy to issue computerized receipts, employ a full time pharmacist who could guide the consumer to cheaper alternatives in case the prescribed drug is not available and to display the price list properly. Besides, the medical practitioners, who dispense medicines at their clinics, will have to get retail pharmacy licenses. For this, the schedule K of the Drugs and Cosmetics Act (DCA) would be amended. Twenty four hour refrigeration for medicines stored in the pharmacy and proper cold chain during transportation would be strictly enforced. "Making it mandatory to issue receipts would check counterfeit medicines getting into the supply chain as well as overcharging. The idea is to bring in a host of consumer friendly policies", said a senior chemicals ministry official.

The chemicals & fertilisers ministry is discussing these proposed amendments with the health ministry which administers the law. Pharmacies are licensed and regulated by the state governments.

These changes could very well push up the cost of compliance for stand alone pharmacies which do not have the economy of scale to lower costs and invest in good practices. In fact some pharmaceutical companies, that opened their own retail pharmacies earlier, had to close them down as the corporate tag forced them to adopt high standards that turned out to be too costly. The pharmacy chains, that are now mushrooming, on the other hand, aim to procure directly from drug makers and bypass wholesalers and distributors. According to market research agency Market Rx, retail pharmacy chains will have the economy of scale and could reduce the price to the consumer by a third.

Medicine Shoppe, Subiksha Retail, Apollo Pharmacy and Guardian Pharmacy are some of the existing chains, while Reliance Retail has big plans in this segment. Existing unorganised retail pharmacies are also in the process of getting corporatised.

(Ref : The Economic Times dated February 20, 2007)

Corporate Hospitals See 15% Earnings From Foreign Patients

With foreign patients coming to Indian hospitals for treatment expected to touch 2 lakh, inbound medical tourism is expected to contribute about 15% of corporate hospitals total earnings by 2009.

Max Healthcare, director Sales and Marketing Sanjay Rai told ET: "Currently corporate hospitals earn about 8-9 % of their total revenue from overseas patients but this will grow to about 15% by 2009." Foreign patients contributed about Rs. 15 crore of Max Healthcare's two super specialist hospitals of its total earning of Rs. 180 crore, he added.

"Last year, foreign patients contributed about 12% of our total revenue of Rs. 224 crore. We expect the revenue from overseas patients to touch 15% in 2 years. About 1,200 foreign patients were treated in our Delhi hospital last year and the number of foreign patients will also grow by over 10 %," added an Apollo Hospital Delhi official.

The share of overseas patients is still small for Fortis Healthcare but it expects it to grow significantly. "Overseas patients contributed about 6-8% of our total revenue of 443 crore. "By 2009, we expect the revenue from overseas patients to significantly grow, Fortis, director marketing Sudarshan Mazumdar said though he refused to give any projections.

According to a CII study, more than 1.5 lakh foreign patients visited India for medical procedures last year and the number is growing by 15% a year. The global world health travellers market is $40 billion and is also growing at over 15% year-on year. At present, India's medical tourism industry to be around $450 million, a report by FICCI and Ernst & Young said. A recent McKinsey study estimates India's "medical tourism" industry could yield as much as $2.2 billion a year by 2012. Currently India's total healthcare industry is about $17 billion and is growing at about 13% annually.

The government is expecting $1 billion revenue from medical tourism by 2010 and is also planning to tie up with private hospitals and tour operators. Industry bodies like CII and FICCI have been campaigning hard to promote medical tourism in overseas markets. However, medical tourism destinations like fare better than India with Thailand and Malaysia attracting 10 lakh and 4 lakh overseas patients respectively every year.

(Ref : The Economic Times dated March 2, 2007)


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