Sun Pharma's extra discount to tide over GST wave

Sop for stockists to ensure easy availability of medicines

Sun Pharmaceuticals’ promoter Aditya Medisales has written to all stockists of the company’s products telling them that they will get extra discount, especially in the consumer health segment.

This is an attempt to ensure that its products are available even with the roll out of the goods and services tax on July 1.

The company is offering an additional discount of 8 per cent on June purchases, if these are greater than average purchases in April and May. They are also providing additional 7 per cent discount on purchases that are more than 80 per cent of April and May purchases.

This additional discount is applicable for drugs in the consumer healthcare division. But it does not apply to brands such as Revital, a dietary supplement, and the Blue R division.

Business Standard has reviewed the letter sent by Aditya Medisales to all Sun Pharma stockists.

In addition to these discounts, the company will provide a 5 per cent reimbursement on closing stock as of June 30, upon providing a declaration given to the government in the form of the GST return.

Others pharmaceutical companies such as GlaxoSmithKline and Abbott are reimbursing their distributors for the loss they would make due to the transition to the GST.

All these measures are being taken to ensure adequate stock of drugs after the government put most medicines in the 12 per cent bracket, causing a minor increase in tax payout for companies. Only life-saving drugs fall in the 5 per cent bracket.