What Will The Effect of Demonetization at Pharmaceutical Sector – 2016 has been a tough ending for everyone. The pharmaceuticals Industry is a blooming industry which is estimated 2, 40, 000 crore. So, one can imagine the money building power of this domain which invites high rate of corruption. With the happiness of New Year, you will be eager to know what will be the effect of Demonetization at Pharmaceutical Sector in 2017 and coming years.
Our Prime Minister Narendra Modi Ji on November 8, 2016, declared demonetization of Rs 500 & Rs 1000. This left the business industry to loads of hazels. The step was taken to eliminate corruption lead to a trail of effect on this medicine supplying domain. Though this industry is like bulletproof when it comes to economic condition, a huge effect was witnessed. In this article by Sunwin Healthcare, we will tell you what will the effect of Demonetization at Pharmaceutical Sector in coming years.
What Does The Term “Demonetization” Mean?
Countries like USA, Ghana, Myanmar, North Korea, Australia and much more applied this term. What is demonetization which is soaring in news? Demonetization is the act of withdrawal of certain currency by depriving of their monetary value. The decision makes a legal tender, no longer a part of the legal currency. Thus, making the value of it to 0 or mere paper or coin. This can happen in two forms – when a country bans the currency or when the country replaces the old currency with a new one. This is a measurement done to stop corruption and haul the flow of black money.
Facts And Figures At The Effect Of Demonetization on Pharma Industry
The Indian Pharmaceuticals sector is a composition of many. It includes companies, doctors, chemists, distributors and much more. Back at the end of 2016, what was the effect which was witnessed by the country in figures and facts? We have listed you some facts and figures from November 8’16 to till date.
- The industry saw a drop in sales by 4% to 5% week by week since demonetization in November’ 2016. This made the lowest sale in the year.
- The demonetization and ban of Rs 500 & Rs 1000 made Pharma products costly. This affected the sales of chemists and pharmacists all over the nation.
- The effect resulted in 30% fall in house prices.
- The frequent fall from 6% to 8% in stock exchange market also saw the effect in the pharmaceuticals market.
- The third contract manufacturing Pharma business met with low production due to failure to meet the cash transactions.
The Effect Of Demonetization On Pharma Industry & Future Job Perspective
The ban of highest domination currency Rs 500 & Rs 1000 left the whole country mourn as the country went cashless when it came to transactions. The biggest witnesses were the lines for depositing old currency to the bank to the difficulty in receiving new ones. The pharma industry consists of various elements which are as follows:
- Pharma Company
- C&F (Carrying & Forwarding Agent)
The cash transaction is a widely accepted mode of transfer everywhere. The individuals who have initiated the business or were going to start one went to face a lot of issues. From prescription to every commission made as a bribe & black money, demonetization affected the pharma journey a lot. If you have illegal money then business will be difficult whereas legal money will win the race.
The Pharma Jobs like medical representatives, pharmacists etc. were also affected. As per 2017 is expected to be a bright year of those seeking for jobs in the pharma industry. The Pharma Vision 2020 is expected to rise to about 12% by next three years. The first half may seem a surge but is expected to smooth out sooner.
After Effects Witnessed By The Pharma Industry Due To Demonetization
The decision of demonetization was a success or failure is still a debate. The Indian Pharmaceuticals is still determined to grow and reach the vision of 2020. What was the effect of the decision of the industry are as follows:
- A good downfall of medicine was witnessed. This will result in legal invoicing & billing habits.
- Prescribe for cash was replaced with ethical codes. This accounted more than 80% of doctors who write prescription against cash.
- Better control of drug administration on sale and purchase above Rs 20, 000 cash against the invoice.
- Blanking has better control over high transactions.
- Rules & regulation against illegal drug & medicines were closely watched by the Government.