PCD franchise margin: MRP, PTR and PTS

What do MRP, PTR and PTS mean?

DPCO 2013 is the Drugs (Prices Control) Order, 2013, the government order that controls medicine prices in India. You can read it on the NPPA website.

How does a medicine move from company to patient?

1. Company to partner or stockist at the partner rate or PTS.
2. Partner or stockist to chemist at PTR, plus GST on the invoice.
3. Chemist to patient at or below MRP, which already includes GST.

Each step's margin is the gap between what that business pays and what it sells at. As a PCD partner you often do the stockist's job yourself, supplying chemists directly, so the gap between your partner rate and PTR is yours to cover your costs and earn from.

What margin does the law allow the chemist?

For scheduled medicines, the ones under price control, DPCO 2013 builds the chemist's margin into the ceiling price: paragraph 7 says that sixteen percent of the price to retailer is allowed as the retailer's margin. In other words, the ceiling price is PTR plus 16% of PTR.

For non-scheduled medicines there is no fixed retailer margin in the order, but paragraph 20 says a manufacturer cannot raise the MRP by more than 10% in twelve months.

You may hear that wholesalers get a fixed 8%. That figure came from older price orders. DPCO 2013 does not fix a wholesaler margin, so treat it as a trade habit, not a rule.

Where does GST fit in?

• Since 22 September 2025, GST on most medicines is 5%, down from 12%. Some life-saving medicines are exempt.
• MRP includes GST. The patient never pays GST on top of MRP.
• PTR and PTS are before GST. GST is added on the invoice at each step, and registered businesses claim it back as input tax credit.
• So when you compare margins, compare prices before GST, on both sides.

How do I calculate my margin? A worked example

The figures below are illustrative only, to show the arithmetic. They are not Acrowell's rates; partner rates are shared on enquiry.

The gross margin is not profit. From it you still pay:

• freight and handling;
• any scheme you offer chemists, such as free goods on a quantity;
• credit you give chemists, and the interest cost of waiting for payment;
• breakage and expiry not covered by the company;
• your field costs: travel, staff, rent.

What remains after these is what you earn, and it depends on your area and how you work it. No honest company can promise that number.

How do schemes change the margin?

A scheme such as "10 + 1" (one unit free with ten) is common in pharma trade. It lowers the effective price for the buyer. On ten units at PTR plus one free, the chemist's effective price per unit falls by about 9%, and that comes out of your margin if you fund it. Before offering a scheme, work out what it costs you per unit, and check whether the company supports it.

What is a "good" margin in a PCD franchise?

There is no single answer, because it depends on the product, the brand and your costs. What matters more than the headline percentage:

• Will it sell? A high margin on a product your doctors do not write earns nothing.
• Will chemists accept the pack and price? A product priced far above similar brands sits on the shelf.
• Is the quality real? Very low partner rates can mean cut corners. Check the company first. How to check a company.

Acrowell sets its rates so partners keep a healthy margin without products being cheap or low quality. The Aurexis Biotech range is a premium portfolio with room for a strong partner margin.

What are the common mistakes?

• Comparing a price with GST to a price without GST.
• Counting gross margin as profit and forgetting freight, schemes, credit and expiry.
• Choosing products by margin alone instead of by what local doctors prescribe.
• Selling above MRP, which is never allowed.
• Assuming the old "fixed 8% wholesaler margin" is a rule.

Frequently asked questions