Subhiksha may move HC against drug supply 'ban'

Retail chain Subhiksha may move the Bombay High Court against the ban on its supplies by the Maharashtra State Chemists and Druggists Association (MSCDA) in Pune and Mumbai.

Subhiksha has locked horns with the association over pricing too as it offers a 10 per cent discount on the MRP and the retailers are against this.

"The association has instructed all the drugs distributors to not supply to Subhiksha. If any distributor supplies to us, they have been threatened with boycott and non-payment. This is illegal and we have complained to the Maharashtra FDA Commissioner. We hope this will be resolved. If nothing comes out, we will be forced to move the High Court," says Subhiksha MD R Subramanian.

In Maharashtra, the retailer claims that association members have been forcing distributors to stop supplies to Subhiksha and have been keeping a strict vigil on all distributors and anyone found supplying to Subhiksha is threatened with action.

However, when contacted the All India Organisation of Chemists and Druggists Association (AIOCD) general secretary J S Shinde said that the issue was resolved and he had instructed the retailers not to obstruct supplies to Subhiksha.

AIOCD is the apex body of drug traders in India of which MSCDA is an affiliate.

The company says that it has filed a complaint with the Maharashtra Food and Drug Administration Commissioner on the ban. The commissioner held a meeting in which association members had agreed to resume supplies, but that has not translated into action, it said.

"We filed a letter yesterday with the commissioner, listing the names of the distributors (including the association president's distribution firm) who have refused supply as well as the written orders that we placed on them," the company said in a release.

Subramanian says they had been facing the problem across the country due to lower prices. In 1999, the Madras High Court dismissed a petition filed by some pharma firms stating that pharma products were essential commodities and it was illegal to ban the supply of the products, he said.

The company is claiming that it is offering true value to consumers by giving them genuine discounts and helping elderly patients.

"The association wants us to fall in line with their wishes of not offering discounts and is unduly pressuring us. We follow all the laws of the land and actually offer true vale to Indian consumers. That is a reason for our continued success," it said.

Subramanian says that though there have been pressures on their supplies, they have been managing their inventories, with delays and denials.

"Essentially, the retailers are working as a cartel. Since we have started our operations in 1997 and giving discounts, they have been trying to disrupt our supplies. The retailers' association have been pressuring distributors to not to supply us. But we are managing our business with a few law abiding suppliers," he says.