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Jan Aushadhi redux: will the generic drug scheme work this time around?

Vishakh Unnikrishnan | Updated on: 5 September 2015, 14:08 IST

The scheme

  • NDA is relaunching UPA scheme Jan Aushadhi to make generic drugs available to the public.
  • The scheme had flopped badly. Very few stores opened, many closed down
  • Only 111 Jan Aushadhi stores are in operation
  • NDA plans to open 3000 stores across India


  • Shortage of generic drugs was the main cause for the failure
  • There was too much reliance on public sector manufacturers
  • Govt could have been under pressure from big pharma companies as well

The NDA government plans to relaunch Jan Aushadhi, a UPA scheme that aimed at making low-priced generic drugs available to the public.

Union minister of state for chemicals, drugs and fertilisers, Hansraj Ahir, on Wednesday, inaugurated a new Jan Aushadi store in Laxmi Nagar, Delhi.

The price difference between branded and generic drugs is significant. For instance, Cetrizine, an anti-allergy drug is available at Rs 2.75 at a Jan Aushadhi store, about 7 times less than the retail price of Rs 20 per strip.

Drugs from various therapeutic groups such anti-diabetic, cardiac, gastro, anti-infective, analgesic and respiratory and vitamins will be stocked in the Jan Aushadhi stores.

A failed scheme

The Jan Aushadhi campaign was launched in April 2008 by Ram Vilas Paswan, the then minister for chemicals and fertilisers.

The scheme flopped badly with many stores closing down way before the government was even close to its target.

According to the last study conducted by the the Public Health Foundation of India (PHFI), only 182 Jan Aushadhi stores have been opened across 16 states/Union Territories, out of which only 111 stores are in operation as on 13 July 2015..

As per the Jan Aushadi website, only 108 stores provide generic medicines. Delhi has only five such stores, one of which is located inside Shastri Bhawan.

Originally, the scheme had envisaged an outlet in every government hospital.

182 Jan Aushadhi stores were opened across India out of which only 111 are in operation

The NDA is even more ambitious. Ahir says that the aim is to launch 3,000 stores, three times of what the UPA had planned.

However, he admitted that there will be some delay in relaunching the scheme due to a general shortage of generic medicines.

Why didn't the scheme work?

  • The PHFI study found excessive reliance on state governments, poor supply chain management, non-prescription of generic medicines by doctors and lack of awareness among the public as the main causes for the failure of the scheme.

  • In April, pharmaceuticals secretary VK Subburaj informed a parliamentary standing committee that the original scheme failed due to improper supply chain management.

  • In 2013, two Jan Aushadi Stores in Chandigarh, operated by the Red Cross Society, shut down. The Red Cross Society alleged they were receiving expired drugs and untimely supply of medicines.

  • In Hyderabad, there were complaints that shops weren't open during crucial hours.

  • The scheme failed to take off instates like Tamil Nadu and West Bengal as the states had initiated their own fair price shops for drugs

Pressure from big pharma?

Pharma experts in the private sector state that private players who had opted for the scheme were left high and dry.

"Small and Medium Enterprise who were roped in for the programme were not sourced at all. It was almost like the government intentionally did not want the programme to succeed," says Jagdeep Singh of the SME Pharma Industries Confederation

"I believe the the government kneeling under pressure from big pharma players, could not go ahead with the scheme," he says

Officials directly involved with the Jan Aushadi programme refused to comment.

Addressing the supply problem

PHFI proposes steps such as increasing the number of drugs available, appointing better distributors, increasing the number of functional stores and relaxation of the eligibility criteria for operating Jan Aushadhi Stores.

As an incentive, the Centre provides a one-time assistance of Rs.2.50 lakhs for setting up a Jan Aushadhi Outlet. Any NGO, self help group or charitable organisation with an 3 years experience in welfare activities, can open a store outside hospital premises.

The earlier scheme relied largely on public sector manufacturers for the supply of generic drugs. The government now plans to source the drugs from small and medium pharma manufacturers.

First published: 5 September 2015, 14:11 IST
Vishakh Unnikrishnan @sparksofvishdom

A graduate of the Asian College of Journalism, Vishakh tracks stories on public policy, environment and culture. Previously at Mint, he enjoys bringing in a touch of humour to the darkest of times and hardest of stories. One word self-description: Quipster