The difference between PCD, ethical and generic pharma is who promotes the medicine and who pays for it. In ethical marketing, the company promotes its own brands to doctors through its own medical representatives. In a PCD franchise, an independent partner does that promotion in a territory, buying the company’s brands and selling them on. In generic supply, medicines are sold by molecule name or on price, with little or no promotion to doctors.
Put another way: ethical marketing is the company’s business, a PCD franchise is your business built on the company’s brand, and generic supply is a trading business. Every other difference follows from that.
Ethical marketing: the company does the promotion
An ethical company employs its own field force. Medical representatives visit doctors on a fixed call cycle, area managers supervise them, and the company decides which brands are promoted and where. Stock moves from the company through carrying and forwarding agents to stockists, and from stockists to chemists.
A stockist in this model earns a trade margin for holding stock, delivering it and extending credit to chemists. The stockist does not decide what gets promoted and does not pay for promotion. The margin is narrower and the work is more predictable. Ethical, here, is a trade term, not a compliment.
PCD franchise: you do the promotion
PCD stands for propaganda cum distribution. The company grants a partner the right to promote and distribute a set of its brands in an agreed territory. The partner buys stock, acts as or appoints the medical representative, works the doctors and chemists in that territory, and keeps the difference between the price paid to the company and the price charged to chemists.
The partner carries the promotion cost the ethical company would otherwise carry, which is why the margin is wider. The partner also carries the risk: if prescriptions do not come, the stock sits. Territory rights are only as good as the written agreement; monopoly rights in PCD pharma covers what it should say, and the model itself is in the PCD pharma franchise guide.
Generic supply: the molecule does the selling
The Drugs (Prices Control) Order, 2013 defines a generic version of a medicine as a formulation sold under its pharmacopoeial name or the name of its active ingredient, without a brand name. Most of what Indian chemists sell is something else: branded generics, off-patent molecules sold under a company’s brand. Ethical companies and PCD companies both sell branded generics. When people in the trade say “generic business”, they usually mean medicines sold to chemists on price and margin, with little or no doctor promotion behind them.
The public end of this market is large. According to the government’s March 2026 backgrounder, more than 18,000 Jan Aushadhi Kendras sell generic medicines at prices 50 to 80 per cent below branded equivalents (PIB). A generic trader competes with that network on price, so volume matters more than margin per strip.
One rule often quoted is not in force. In August 2023 the National Medical Commission notified regulations requiring doctors to prescribe by generic name, then held them in abeyance the same month (Business Standard). The 2002 regulations apply, and doctors in India still prescribe brands. The argument about ethical versus generic misses the fact that most of the Indian market is branded generics sold through all three routes.
The three models side by side
| Ethical marketing | PCD franchise | Generic supply | |
|---|---|---|---|
| Who promotes | The company’s own representatives | You, or representatives you employ | Little or none |
| Who decides the sale | The doctor | The doctor, worked by you | The chemist, on price |
| Investment | Stock and working capital; no promotion spend | Opening stock, working capital, field costs | Stock and working capital; needs volume to pay |
| Marketing rights | None; the company decides | Territory and product list, as written | None; anyone can sell the molecule |
| Margin | A fixed trade margin | The gap between the company’s rate and the chemist’s rate; wider, because you pay for promotion | Looks wide on paper; price competition compresses it |
| Brand ownership | The company | The company; you hold the right to sell | No brand, or the supplier’s trade name |
| Credit and expiry risk | Credit to chemists | Credit, plus stock moving towards expiry | Credit, plus a price drop can leave stock worth less than you paid |
Which model suits whom
A medical representative with doctor relationships
A PCD franchise. The relationships you already have are the asset, and brand rights give you something of your own to promote. The risk sits in the first months, while prescriptions build and the opening stock is still on your shelf.
An established stockist with a chemist network
Ethical distribution or generic trading uses what you already have: capital, delivery and collections. A PCD line adds promotion work you may not be set up for. Some stockists take one or two PCD ranges where they know the prescribers and leave the rest of the business as it is.
Someone new to the trade
None of the three is quick. Generic trading needs volume and tight collections from the start. A PCD franchise needs prescriptions, which take repeated visits. Start with the licence and one territory you can cover in person. What it costs to start sets out each line.
Rules that apply to all three
- A wholesale Drug Licence, Forms 20B and 21B, from your state drugs control department. The documents are the same whichever model you choose.
- GST. From 22 September 2025 the rate on most medicines fell from 12 to 5 per cent, and 33 life-saving drugs moved to nil (All India Radio).
- The Uniform Code for Pharmaceutical Marketing Practices, 2024, notified on 12 March 2024. It prohibits gifts, travel, hospitality and cash to healthcare professionals and their families, caps brand reminders at ₹1,000 per item, and applies to whoever does the promoting.
- DPCO 2013. Ceiling prices on scheduled formulations and a 10 per cent annual cap on MRP increases for the rest, whichever route the medicine took to the chemist.
Where we fit, and where we do not
We are a wholesale trader and supplier. We supply stockists on trade terms and PCD partners by territory, across 25+ therapeutic ranges. We do not run a generic counter business, so if your model is price-led generic trading, our rate list will not be the lowest you see. We hold rates for the agreed term, which is a different thing.
Questions people ask
What is the difference between PCD and ethical pharma?
Who pays for the doctor promotion. In ethical marketing the company employs the medical representatives and the stockist earns a trade margin. In a PCD franchise an independent partner does the promotion in a territory and keeps a wider margin for it.
What is the generic pharma business in India?
Supplying medicines to chemists on price and margin with little or no doctor promotion. The DPCO 2013 defines a generic as a formulation sold under its pharmacopoeial or active-ingredient name; in trade usage the word also covers low-priced branded generics.
What is a branded generic?
An off-patent molecule sold under a company’s own brand name. Most of what Indian chemists sell is a branded generic, whether it reaches them through ethical marketing, a PCD partner or a generic trader.
Which model is most profitable?
Per pack, PCD, because the partner is paid for promotion. Per year, a stockist on ethical lines or a generic trader can earn more on volume with less risk. Expiry and chemist credit decide the real figure in all three.
Can one firm work on all three models?
Yes, and many stockists do: ethical lines for several companies, one or two PCD ranges where they know the prescribers, and a generic counter for price-led demand. Check that a PCD agreement does not restrict competing molecules.
Does the UCPMP 2024 apply to PCD partners?
Yes. The code governs promotion to healthcare professionals whoever does it. Gifts, travel, hospitality and cash are prohibited and brand reminders are capped at ₹1,000 per item.
Tell us which model you are working on
Stockist terms or a PCD territory. Send the ranges and your district and we will reply with the rate list and what is open, in writing. In wholesale supply since 2000.
Regulatory references checked against the linked sources on 8 October 2026. This is general information about commercial models, not legal or medical advice.