Amma pharmacies: A balm for drug pricing

 CHENNAI: Medicines always top the list of monthly expenditures for 70-year-old Nanganallur resident Shanta Subramanian, who sets aside at least 1,500 to buy her dose of pills. The septuagenarian, who has diabetes and high blood pressure, is among those who are curious about the flurry of activity on First Main Road, where an ‘Amma Marundhagam’ (Pharmacy) outlet is set to open on Thursday. 
After Amma canteens, Amma water and Amma salt, Tamil Nadu government is now launching a chain of Amma drug stores, a welfare scheme that promises to upend the pharma industry’s pricing model. Providing branded medicine at a discount of 10% to MRP (maximum retail price) through state-run outlets, the AIADMK regime hopes to soften the impact of rising prices on the public. At a time when the Centre is looking at ways to bring more drugs in the $15bn Indian market under price control, the TN model of intervention promises a novel solution. 
The plan is to use the cooperative store network in the state to stock up on branded medicines bought in bulk from drug companies at a marginal discount and ensure sale at a slightly marked-up price that would still be below the rate at which they are sold in the open retail market. 
According to officials, a detailed survey was undertaken to identify areas to set up the outlets. “We identified localities where the demand is high and where there were few or no medical shops. We also spoke to residents’ associations in these areas before zeroing in on the localities, many of which will be on the city’s periphery,” the official added. 
The scheme may well help to rein in retail margins and act as a check against sharp practices. “Though Amma pharmacies are limited and may not totally fulfil the demand of the people, the price at which we sell medicines will force private shop owners to at least give some discount,” a source said.turns from here. 
Local pharmacists, however, are undaunted by the pricing challenge. “Opening 100 pharmacies will not make much of a difference. It is not possible for one pharmacy to stock all the medicines. The same medicine may have different formulations and dosage. So even if people flock to these pharmacies, if the medicine is not available there then they will head to the next nearest pharmacy,” said S Elangovan of TN Chemists and Druggists Association. 
Chief minister J Jayalalithaa will inaugurate a total of 10 outlets in seven districts, including one in Nanganallur in Chennai’s suburb on Thursday. The others will be in Kancheepuram, Cuddalore, Erode and Sivaganga, and two each in Salem, Madurai and Virudhunagar. The long-term goal is to set up 100 such pharmacies across the state, a move that could win more brownie points for the chief minister. 
Finance minister O Panneerselvam had announced the proposal in the state budget in February. The state government had announced that Rs 20 crore would be used from the Price Stabilisation Fund for running the pharmacies.An official said out of the 100 shops in the state, 10 will be in Chennai. “At a later stage, we plan to set up a computerized database and procure medicines based on requirements from each shop,” he said. 
“Since the medical shops can be opened only with pharmacist licenses, we have recruited a few pharmacists, and with their licenses the shops will be opened,” a joint registrar in the department said. The monthly consolidated salary for the pharmacists would be Rs 7,000. 

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