How To Start Medical Store Business in India? A Complete Guide

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How to Start a Medical Store Business in India

The business that remains mostly unaffected by the ever-changing economic cycles is the medical business. Irrespective of any situation, health is the utmost important part of a person’s life. ‘Health is wealth’ the famous proverb explains it all.
In India, the health & medicine business is flourishing at unbelievable speed, the credit goes to the corporate & multi-speciality hospitals. For startups & individuals who have less to invest, but want to invest in the healthcare sector only, investing in a medical store is the best option available. Though there is neck-to-neck competition, it is still a vital sector for investment.
Despite having remarkable importance, medical stores are responsible for a person’s life. A little mistake may cost a large expense to their customer. This is why medical stores are required to fulfil all the legalities & procedures before selling the medicines. Plus in today’s competitive world it is equally important to have medical store management software to be competitive & able to handle all dealings online. And machines do not commit mistakes, so it is much safer to have medical shop billing software to smoothen the entire business process. But it is a later part, let’s first start with the requirements of “how to start a medical store in India”.

Select the type of medical store:

Before moving ahead you must first select the type of medical store you want to invest in. The options available are:

  • Hospital Medical Store – You must have seen a medical store inside the hospital premises, developed to cater to the patients.
  • Standalone Medical Store – The individual small/medium medical stores that are present in the residential areas. It is one of the most common forms.
  • Chain Pharmacy/Franchise Outlets – Medical stores that are part of a chain of pharmacies, have branches in different areas. Normally a big store.
  • Township Medical Stores – It is set-up in a township to cater to the needs of the people.
  • Stores in Government Premises – Medical stores/ Dispensaries inside Government offices & buildings.

Before applying for registration of medical shop, the person/owner must fulfill the following requirements :

1. Pharmacy Licence

In order to obtain a medical store License, it is mandatory for a person to have a degree of B. Pharm or M. Pharm.

2. Land Registration

In order to register for the land, one must first decide whether he wants to own a shop or rent a shop depending upon the budget. Rent or sale deed agreement is important & you may choose legal assistance for the same.

3. Registration of Medical Store Business

In India, medical stores are registered under Indian Pharmacy Act 1948. The act states that all medical stores & pharmacies must register themselves with all documentation under the state government. After submitting the documents the officials will decide the registration as per the norms.

The constitution of medical store is important. A standalone medical store is preferably set up as a proprietorship or as a partnership firm while the hospital, chain, and township medical stores prefer to set up a private limited company. Recently, Limited Liability Partnerships (LLPs) is also a preferred form of company registration among the medical store owners. This change is mainly attributed to the promotion of the rights of the partners that is provided in the LLP form of constitution.

4. Company Registration

Depending on how you want to operate your business, registering your business as a partnership or proprietorship or full-fledged company since day one is very important. The following are the available options:

  • Proprietorship Registration
  • Partnership Registration
  • One person Company Registration
  • Private Limited Company
  • Limited Liability Partnership

5. Tax Registration

If your aggregate turnover exceeds the threshold limit, then it is mandatory for you to register your business entity with the Goods & Service Tax (GST). The limit specified by the GST Council is INR 20 lakhs for all states other than the North-Easter Hilly states where the limit is INR 10 lakhs.

6. Registering for Drug License

Irrespective of the size of the business every medical store requires to attain a drug license from the Central Drugs Standards Control Organization and State Drugs Standard Control Organization.

These organizations majorly issues two drug licenses:

  1. Retail Drug License
  2. Wholesale Drug License


6.1. Retail Drug License:

To run a general/retail chemist or medical shop, a retail drug license is required. The registration can be done only in the name of an individual who has a valid degree or diploma in pharmacy from a recognized institute or university. A fee has to be deposited to attain the license.

6.2. Wholesale Drug License:

The license is issued for wholesale dealing of drugs & medicine to medical stores. Unlike Retail Drug License, there are not many stringent conditions that one has to meet in order to get this license.

What are the minimum requirements that are required for obtaining a Drug License?

Below are the few important requirements to attain a drug license.

  • Area: Minimum 10 square meters of area is required for common retail and 15 square meters for wholesale business.
  • Storage Facility: Store must be equipped with an air conditioner & a refrigerator. This is important because certain drugs like vaccines, Sera, Insulin Injections etc need to be stored in the refrigerator or in a cool place.
  • Staff: Both the types of medical stores require staff with knowledge of medicine;
  • Wholesale business: As per the rules the sale of the drugs in a wholesale medical store can only be done in the presence of a registered pharmacist with one year of experience in dealing in drugs or a person with an experience of 4 years who has passed S.S.L.C approved by the Department of Drug Control.
  • Retail Store: The registered pharmacist must be present at the time of sale of medicines during working hours.

Medical Billing Software by Marg ERP

What are the documents required for obtaining a Drug License?

Below is the list of documents required for procuring a drug license in India. It may vary across different states:

  • Application form in the prescribed format.
  • A duly signed cover letter with application with the details of name and designation of the applicant.
  • Fee receipt or challan submitted for registration.
  • Blueprint of the premises.
  • Affidavit of a registered pharmacist or a person equally competent who will be working for full time.
  • Declaration form.
  • Proof of ownership of the premises.
  • Proof of business constitution and registration.
  • Affidavit of non-conviction of proprietor or partners or directors under the Drug and Cosmetics Act, 1940.

Appointment letter from a registered pharmacist or any competent person, if employed.

What else do you need to smoothly run your medical store?

If you are looking to start a medical shop, whether retail or wholesale, in addition to the above important documents one thing you must implement is medical store management software. From billing to deliveries, all your processes will be taken care of by the software & you will be able to concentrate on increasing your sales.

One such robust software is Marg Medical Store Software which is proven in the pharmacy industry & is the most suitable for startups, small & medium-sized businesses.

Medical Store Software download

FAQs on Starting of Medical Business in India

Pharmacy business is one of the most consistent businesses. Chemist shop is a highly profitable business. Most of the business in pharmacy & drug medicines is making good profits. Even OTC (Over the counter) stores are highly profitable.

No, doctors cannot run pharmacy officially. Pharmacy store or chemist store license is allotted in the name of pharmacist not doctor.

To start a medical shop you must have B. Pharm or M.Pharma degree. B.Pharmais the best course. You can pursue the course after 12th in the science stream.

Yes, after completing your B.Pharma you can apply for a medical shop but first you have to register yourself with your state pharmacy council. You need to obtain an official certification & then start your medical shop. Usually this takes 45 days’ time.

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