Protect your pharmacy profits. Understand the exact math behind Price to Retailer (PTR), Price to Stockist (PTS), DPCO 16% vs 20% ethical margins, and GST input credit adjustments.
Pharmaceutical margins are strictly governed under the Drugs Prices Control Order (DPCO). Here are the exact industry formulas used across India:
Assume a branded ethical medicine with an MRP of ₹100, subject to standard 12% GST and 20% retailer margin:
₹100 / 1.12 = ₹89.28
20% of ₹89.28 = ₹17.86₹89.28 - ₹17.86 = ₹71.42
₹71.42 + 12% GST (₹8.57) = ₹79.99
Covered under National List of Essential Medicines (NLEM). Government caps maximum ceiling prices:
Ethical formulations outside the NLEM list where manufacturers set pricing under annual 10% hike limits:
During live billing and wholesaler purchasing, manual margin math wastes time. StockMed does the heavy lifting:
Whenever you add a medicine to the billing cart, StockMed displays your exact profit margin percentage and rupee profit per strip before you confirm any customer discount.
When purchasing 10+2 free from a distributor, StockMed recalculates your true landing rate so you know your actual margin jumps from 20% to 33.3%.
Distributors offer a Cash Discount (typically 1.5% to 2%) if the retailer settles the invoice within 7 to 10 days instead of the usual 21-day credit window. StockMed's built-in Early Payment Calculator tells you if paying early yields a higher return than keeping capital in the bank.
No. Under the Legal Metrology Act and DPCO guidelines, selling medicines above printed MRP is a criminal offense subject to heavy penalties and seizure of stock.
Yes. While branded ethical medicines have fixed 16%–20% margins, unbranded generic medicines and PCD pharma products often carry trade margins between 40% and 75%, allowing retailers to offer healthy patient discounts while preserving profits.
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