The significant milestone in 2013 was the introduction of DPCO or Drug Price Control Order. Earlier, huge profit margins and MRP made pharma sector a lucrative business opportunity for entrepreneurs. Those who launched business ventures before DPCO introduction made a fortune. However, after that, the things changed greatly. Now, most of the drugs fall under the DPCO bracket. This dent to the profitability affected the growth of PCD pharma business up to a substantial extent.
Experts say that it is not the only factor that should be blamed for the downfall of the pharma sector. There are many other contributors to it. Let’s understand these aspects one by one.
Stringent Competition
As everyday new PCD pharma businesses emerge at the horizon, competition increases exponentially. Yes, the market base is expanding, but still, it becomes difficult to run the pharma business. PCD companies put pressure on the salesforce to convince and pursue doctors to recommend the products. The companies are forced to do it to meet the sales targets.
Increasing Rules And Regulations
The business has tremendous growth potential, but the quality standards still need a lot of improvement to become comparable with the international standards. Hence, the government imposes more stringent rules and regulations to make it comparable. It increases the troubles of manufacturers and PCD pharma businesses.
International Prices
The pharma business is closely linked to the international markets. The price control is in the hands of global players mainly. It makes the things difficult for companies that do business in the domestic markets only. They find it difficult to convince the buyers of the sudden price fluctuations. The situation becomes even more awkward if the competition is fierce.
The Rise Of Online Business
Indeed, it is in the beginning stage as of now, but the online pharma business is performing quite well. It will be a mistake to ignore the power and reach of it. Once established, it can change the way business is being done today. Primarily online business will impact the distribution system. Therefore, entrepreneurs running a PCD business need to be ready with the strategy to deal with the challenge.
High Investment
Though not exorbitant, you need considerable money to start PCD pharma business. Also, the operating costs keep on increasing month after month. Hence, the profit margin shrinks if the business doesn’t show adequate growth. All these factors make it a tough business.
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