How to open a Medical Store in India?

Healthcare sector in India is growing remarkably due to increase in hospitals especially multi-specialty hospitals as the diseases are increasing at a fast pace and to cope with such situation, medications and hospital facilities become the need of an hour. The medical business in India does not affect even in the situation of pandemic or economic crisis.

Pharmacies and Medical stores are considered to be the last distribution channel of medicines and other pharmaceutical essentials and this is the most profitable business of all times as compared to others. But before commencing this venture, proper analysis and planning of the same is very crucial otherwise it would result in failure of business.

Types of Medical Stores in India

There is various type of medical stores that can be owned by entrepreneur. This type of business is flourishing in India at a high speed. Therefore, choosing of correct type is very important. Some of the most common option available are as follows:

• Hospital Medical Store– It is a kind of medical store that is present inside the hospital and provide medical facilities to the patients in the hospital itself. It also caters to the needs of patients and provide services to them.
• Standalone Medical Store– These standalone medical stores are located in Residential areas and it is the most recommended form of medical stores in India.
• Chain Pharmacy– These Pharmacies or medical stores franchise are situated in shopping malls or complexes. These are also known as Franchise outlets.
• Township Medical Stores– It is a kind of medical store which is located in towns and also cater to needs of people residing in townships.      

Prerequisite for opening a Medical Store in India

Besides having all the required documents to open a pharmacy, there are other prerequisites that needs to be taken care of such as:

• Degree– A professional degree of B pharma/M pharma for a owner is necessary for opening medical store in India and if such person does not have such degree then he has to employ a person as a pharmacist having such degrees or diploma.
• Location– Before commencing a business of medical store or pharmacy choosing of a location is an important thing to consider. A good location will always help shops to perform well and sustain in a long run.
• Making contact– Owner shall get in touch with medicine manufacturing company or the wholesalers to get the stock of medicines at his shop and hence it will give a better profit margin. But a high order quantity is required. Distributors and suppliers of medicines and other product can also be approached by the owner itself in his locality.
• Medical Store area– For starting a medical store, an area of about 100 sq feet is required and should have adequate space for refrigerator, racks, drawers, pallets, etc. Proper cemented floor and concreted roof should be there without any cracks and flakes in the premises.
• Storage– A refrigerator is required to store injections such as insulin, antibiotics, vaccines and other medicines which is required to store at comparatively low temperature.
• Investment– The initial investment on a medical store depends upon the location, area, city and other factors such as whether premises is on rent or owned, whether owner is the pharmacist only or he needs to employ some other person as his pharmacist, etc.
• Documents required– There are several documents required to apply for a medical store or pharmacy in India.

Documents required to set up Medical Store in India

The following documents are required to set-up a Medical Store in India:

• Application Form in the prescribed format with respect to Pharmacy License
• Covering letter that specifies the purpose of application along with the name, signature and designation of the applicant
• Challan for depositing fees for obtaining drug License
• Declaration form
• Key plan for using such premises
• Site plan including the design layout for the premises
• ID proofs and photos of the owners or all the partners of the premises
• Residential Address proof of the pharmacist and the applicant
• Education qualification certificate of the pharmacist
• If the premises to be used is on rent, then proof of ownership as well as rental agreement and declaration by the owner of premises
• Certificate of Incorporation or MOA, AOA or partnership deed as a proof of constitution of Company
• Non-conviction affidavit of proprietor or partner or directors as the case may be under the Drugs and cosmetics Act, 1940
• If registered pharmacist or competent personnel is hired than his appointment letter
• Affidavit of such registered pharmacist or competent person working on full time basis

Licenses and Registrations required for setting up Medical Store in India

Various Registration and licenses are required for setting up a Medical Store in India such as:

• Land Registration– An owner can have its own piece of land registered as a medical shop or pharmacy by submitting sale agreement or rent agreement. For registering a land for this purpose involvement of various legal entities shall take place.
• Registration of business as Medical Store– Registration of Medical stores are governed by The Indian Pharmacy Act, 1948 and according to such Act, every medical store shall get itself register by submitting all the required documents to the governing body. Various Types of medical stores shall get itself registered either as a private company or sole proprietorship or as an LLP.
• Company registration– Registration of business either as a private limited company or as an LLP, etc. is very important. An applicant can apply for either proprietorship registration, partnership registration, OPC registration, Private limited company registration, LLP registration, Shop registration, etc.
• Tax Registration– GST registration is must and essential for a medical business also. Different threshold limits are taken into consideration that are available in GST registration.
• Drug License– Irrespective of nature of medical store, its type, size, turnover every medical store is require to obtain Drug license from Central or State Drug standards control organization.

Types of Drug License

Drug license is the most essential requirement of opening medical store in India. If all the requirements are duly complied with then Central or State Drug standards control organization shall issue a License. There are two types of Drug License issued such as:

• Retail Drug License- This type of license is required to run a general chemist shop. It also requires minimum fees to begin such operations. It is generally issue to a person having degree or diploma in pharmacy from recognized university on payment of such fees as prescribed.
• Wholesale Drug License- If an applicant wants to sell or supply medicines in bulk or wholesale then wholesale drug license is required to be acquire by him. Various restrictions are levied on issue of such license. For a wholesale pharmacy a registered pharmacist is not required but a competent person is required to have minimum 1-year experience in dealing with medicines.

The application for opening a medical store needs to be submitted along with the attachments discussed above and also with the requisite fees. Once the application is submitted, drug department shall initiate an investigation for the same and License shall be allotted to run a medical store by concerned authorities.

Conclusion

To start a business of running medical store or pharmacy one needs to take proper steps and follow adequate procedures for running such business venture. Healthcare sector is developing at a very fast pace and will continue to do so in future. The profit margins in such business are quite high and also there are several advantages of the same. Proper analysis and planning is must before commencing such kind of business.

Planning to start a medical store in your area? Get end to end expertise from Legal Window.