GST hits supply, essential medicines vanish from shelves in Kolkata

Original Post Source
KOLKATA: The new tax regime has proved to be a bitter pill for patients as several essential medicines, including those for heart, blood sugar and blood pressure, remain scarce even 40 days after the rollout of the goods and services tax (GST).

With drug supply across the city slowing down as pharma companies and distributors come to terms with the new pricing system, West Bengal Chemists’ and Druggists’ Association (WBCDA) says it might take another week for supply to normalize. Drug stores, however, fear it could take much longer.

Nearly 40% of drug distributors in Bengal are yet to secure GST registration, and this is one of the factors affecting the flow of medicines into retail stores, says WBCDA. Even though drug prices have remained uncha-nged post-GST — retailers are selling old stocks at pre-GST prices — a 2%- 2.5% rise is imminent from October.

But what has left Kolkatans worried is the short supply of some essential medicines like Galvusmet (for blood sugar), Stamlo 5 (for blood pressure) and widely used antacids Pan 40 and Pan D. Several drug stores in south and central Kolkata have been able to procure less than half the requirement for these medicines in August.

“Several commonly prescribed drugs have suddenly disappeared. This is due to the slow supply from the distributors’ end. Around 40% of the latter are yet to get GST registrations, without which they can’t procure drugs. So, the supply volume has gone down,” said Subodh Ghosh, the general secretary of WBCDA.

Thankfully, most retailers have multiple distributors to fall back on. So, even if one can’t supply certain drugs, others chip in. This has ensured that all drugs are still available, though their supplies have remained insufficient. “It’s taking time to replenish the stock of some essential drugs, which is a worry. Some of these are cardiac, blood pressure and diabetes-control medicines that have to be taken regularly by patients. This has left many of our customers desperate and we have been forced to direct them to other shops. But it is turning out to be difficult for the elderly to procure some of these medicines,” said Sanjay Majumdar, owner of The Pharmacy, a drug store in New Alipore.

Drug store chains like Blue Print and Frank Ross, too, have been grappling with the shortage. It ranges between 20% and 30%, according to a Frank Ross spokesperson. “By the time we manage to have an adequate supply of a few, several others are turning scarce. We had expected the supply to normalize by August, but distributors are still struggling to secure enough drugs. It seems unlikely for the supply to normalize before September,” he said.

Many distributors have been thrown out of the supply chain since they don’t have GST registration, yet, said Ghosh. They are also struggling to install software and adapt to the new procurement and distribution rules in the GST regime. “With the demand for software, necessitated by the new GST billing pattern having suddenly shot up, hundreds of distributors have been left in the lurch. They are still waiting for software and personnel to install and operate them. Till they can arrange for these, supply will remain irregular. But things are improving,” said Ghosh.

He added that the new GST rules have also led to a cost escalation for distributors and small retailers, threatening their existence. “While big retailers can easily appoint personnel to look after their software requirements and tax return formalities – that have now changed – smaller ones are struggling with the additional expenditure,” said Ghosh.

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