What is Profit Margin of Pharmaceutical Retailer (Chemist and Pharmacies)?

What is Profit Margin of Pharmaceutical Retailer (Chemist and Pharmacies)? – When entering into the pharmaceutical business as a retailer the question arises that what profit margin one can earn. Profit margin is set by the pharmaceutical company but rather they depend upon the market condition. There are many factors that affect the retail business of the pharmaceuticals industry. A retailer is an important person that keeps the chain of business alive and connected with the end-customer. If you are someone who wants to start their own pharma retail business, then knowing what is profit margin of pharmaceutical retailer (chemist and pharmacies) is essential.

A chemist and pharmacy comes at the bottom of the pharma supply and distribution channel. They are very important as they have direct contact with the customer. Being locally aware about the on-going demand and benefits, one can go for a good profit margin in this business. In this blog by Pax Healthcare, we share you, ‘what is profit margin of pharmaceutical retailer (chemist and pharmacies) in India.


What is Profit Margin of Pharmaceutical Retailer (Chemist and Pharmacies)?

Profit Margin of Retailers in the Pharmaceutical Industry

The distribution channel has its own method of working and dividing the profits among the various channels. The distributors include medical store drugstore pharmacist chemist etc. The pharmaceutical retailers are the ones who avail the maximum benefit in this channel of distribution. They are involved in the direct dealing of dispensing of drugs against the prescription of a medical practitioner who is authentic to the patients. This provides them with the opportunity to earn the maximum profit margin. According to the various types of marketing of the pharmaceutical company, the amount of the retailer’s profit margin varies.

Generic Medicine Marketing

In generic medicine market the dealer has to sell the generic medicine to the pharmacy and chemist and not directly to the patients. The profit margin in the generic medicine market is approximately around 30% market depends on the rate here and therefore the retailers have to sell the maximum drugs to the patients in order to gain the maximum margins. Companies.

Branded / Ethical / Description Drug Marketing

The dealer in the branded drugs marketing has to directly sell the drugs to the patients by collaborating with certain doctors. Here it is advisable to have good links with the doctors who would refer the patients to their particular pharmacy.

The profit margin offered in this marketing is around 18 to 22% plus additional benefits.
The wholesaler sells the medicine to the pharmaceutical retailer at price to retailer PRT which is 18 to 22 per cent less than MRP minus GST.
In case the invoice is issued then it will have PTR less GST if the distributor is registered under the GST Act. The companies add the manufacturing cost and their profit margin and then distributor generic medicine. Company does not have much control over the profit margin of the distribution channel.

Pharma Franchise Marketing

Here the pharma franchise distributors play the role of distributing drugs. Recent prices distributors promote medicines in somewhat the same manner as branded medicine, therefore, resulting in similar profit margin that shall be 18 to 22% plus additional benefits.

Over the Counter Medicine Marketing

OTC drugs sale follows the same pattern as of branded drugs where buy they are sold without medical practitioners prescriptions. Therefore the customer must ask for the drugs by the name of the brand or else they shall be treated as generic medicine and the retailer shell on the profit margin that is applicable in case of branded drugs marketing.


Knowing your profit margin is essential for every marketing business. To earn the best connecting with a genuine and profitable business in the pharma industry, Pax Healthcare is the leading Pharma Company in India. We are connected with more than 200+ associates across India with over 500+ associates connecting for distribution, wholesale to retailer business. You can trust us for a genuine dealership and growth opportunities in near future. Hope the article was beneficial for you.