Skip to main content

The Complex Factors that Influence Drug Prices

Pharmaceutical companies typically use a variety of factors to determine the price of their drugs, including: Development and production costs: Pharmaceutical companies invest significant amounts of money into the research, development, and production of new drugs. The cost of these activities, including clinical trials and obtaining regulatory approval, is factored into the price of the drug. Marketing and Distribution Cost: Marketing and distribution costs may also be considered by pharmaceutical companies when determining drug prices. These costs include expenses related to advertising, sales representatives, and distribution networks. Drug Uniqueness: If a drug is the first of its kind or represents a significant improvement over existing treatments, the pharmaceutical company may set a higher price for it. If a drug has many competitors or is like existing treatments, the company may have to set a lower price to remain competitive. Market demand: Companies also consider the dem

How much investment required in third-party manufacturing and Loan License Manufacturing?

Today we will talk about a query. Query is that how much investment is required for third party manufacturing and loan licensing if started with 4 products?

Loan Licensing and Third Party, both are different

If we discuss in detail 
Loan licensing is what in which a pharmaceutical marketing company tie up with pharmaceutical manufacturing company and manufacturing company apply for issue for manufacturing license for marketing company in its premises that is applied at state drug control authority

That is like applying for new manufacturing license and that takes lots of investment because whole documents and process is to proceed from new way.
Plant, machinery and technical persons are used of manufacturing company and new manufacturing license is issued at marketing company name.

So, the manufactured by name is of marketing company also in loan license. Manufacturing name will be of marketing company in loan licensing. Only address is belonging to pharmaceutical manufacturing company. So, investment not only depend at products but initial investment also cost you lot.

If we talk about third party manufacturing concept, only you need to find for a third-party pharmaceutical manufacturing company who can provide you your marketed by product under your brand name at third party manufacturing basis.

You need to contact them and give your product detail that you want to manufacture and their brand name

If manufacturer already has approval of that ingredient/composition then it doesn't need to take approval but if manufacturer doesn't have approval, then it will take ingredient/composition approval from state drug licensing authority

Then manufacturer will design your products design and proceed further.

According to payment schedule and other term & conditions finalization, your products go into manufacturing process for finished goods.

In that case marketed by name and address will be yours and manufactured by name and address will be of actual manufacturing company.

Here you have to invest only amount as per cost of these four products only.

Investment requires for third party and contract manufacturing:

It is not fixed when we talk about investment or costing of product because some products are cheaper and some are expensive.

If you will get manufactured costlier product then your investment will go high and if those are cheaper then investment will be less

Suppose you get manufactured a product having cost 50 rs per box

and you get manufactured 500 boxes as minimum order quantity at third party manufacturing basis then this will cost you 500*50 = 25000 plus gst or freight included or excluded as finalized under term & conditions
So that will cost you 25000 plus gst

But if you have finalized a product having 600 rs per box and getting manufactured 300 boxes then this will cost you 600*300 = 180000 plus gst or freight included or excluded as finalized under term & conditions

So that's difficult to give idea how much investment you require to launch four products that depend at your products cost whether you are getting manufactured cheaper products or costlier products...

For cheaper products investment will be low and costlier product, it will be high.

It is better to avoid loan licensing in starting because you have to invest more at documents and licensing also

Some pharmaceutical manufacturing companies also charges monthly rent from marketing company for loan licensing because you are using its manufacturing facilities or they charge based on per pc or as per your tie-up that cost you more

But in third party manufacturing, you can avoid this so, you need to go for third party manufacturing.

And as per your products you can calculate whether they are cheaper or costlier and how much minimum order quantity, how much cost of your product, packaging charges if applicable or any security charges is applicable or not?

So, there are many factors

Calculate all and find out how much investment you require for getting manufactured your product at third party basis or loan licensing

Hope this information is helpful to you...


Ayurvedic Medicine Company

Send Distribution/Franchise Query


Email *

Message *

Register your business at

Find pharmaceutical, cosmetics, nutraceutical, ayurveda and alternative medicine's distributors, franchise, suppliers query for free.

If you want to take distribution, franchise or associates with any pharmaceutical, cosmetic or ayush company then you can find it here...

Popular posts from this blog

What are the Schedules under Drug and Cosmetic Act, 1940 & Rules 1945?

Schedules are the set of provisions for classifications of drugs, forms, fees, standards, requirements and regulations related to pharmaceutical, Ayurvedic (including siddha), unani and tibb system of medicines, homeopathy, blood and realted products etc under Drug and Cosmetic Act, 1940 and Rules, 1945. The schedule to the drugs and cosmetics act are Schedule A, B, C, D, E, F, G, H, I, J, K, L, M, N, O, P, Q, R, S, T, U, V, W, X, Y. Drug and cosmetic rules are divided into schedules alphabetically and named also alphabetically like Schedule A, Schedule B etc till Schedule Y. The schedules to the drugs and cosmetics act are important part. Every schedule contains specific information as discussed below. Schedule A:  Schedule A  describes application forms and licenses types. Download Schedule A Pdf Schedule B:  Schedule B  describes Fees for test or analysis by the Central Drugs Laboratories or State Drugs Laboratories. Download Schedule B Pdf Schedule B1: Schedule B1 describes

State Pharmacy Council, Its Constitution and Composition and Functions

State Pharmacy Council: State Pharmacy Council is constituted as per the Pharmacy Act, 1948 & State Pharmacy Rules, 1951. State Pharmacy Council is an authoritative council to regulate Pharmacy Act, 1948 & State Pharmacy Rules, 1951. What is state pharmacy council? State Pharmacy Council means a State Council of Pharmacy constituted under section 19, and includes a Joint State Council of Pharmacy constituted in accordance with an agreement under section 20 under the Pharmacy Act, 1948 & State Pharmacy Rules, 1951. State Pharmacy Council constituted and work under  Pharmacy council of India . Composition of State Pharmacy Council: The State Pharmacy Council consists of the following: i) Six members, elected from amongst themselves by registered pharmacists of the State; ii) Five members, of whom at least three shall be persons possessing a prescribed degree or diploma in pharmacy or pharmaceutical chemistry or registered pharmacists nominated by the State Governme

How to Register as a Pharmacist in India?

Who is a Pharmacist: Pharmacist is a person having educational qualification in pharmacy profession i.e. Diploma in Pharmacy or Bachelor in pharmacy or Pharma D etc. Who is a Registered Pharmacist: Registered Pharmacist is a person having educational qualification in pharmacy and his/her name is registered under state pharmacy council  of state in which person reside or want to conduct his/her profession or business . How to become a Registered Pharmacist? For becoming pharmacist in India, a person has to fulfill criteria as per Pharmacy Act. A person want to register himself/herself as a pharmacist should have at least minimum of Diploma in Pharmacy or Bachelor in Pharmacy or Pharma D. After completing above mentioned qualifications, you become eligible for registering as a pharmacist. If you have only Diploma in pharmacy, then 500 hours practical training spread over a period of not less than 3 months is also required to become eligible. download pdf After registering your name in s