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How To Start A Medical Shop In India

Medical stores never go out of business. Even during the global pandemic, when most parts of the world were in lockdown, medical stores were allowed to operate under essential services.

Medical shops are an absolute necessity. Each person wants a medical shop near their homes and offices. Have you ever thought about how much income this field of business might generate? Pharmacies are always in business and hardly affected by economic turbulence. 

The healthcare and pharmaceutical industry has grown rapidly, bringing the need for more businesses. India ranks 3rd in the world’s pharmaceutical production by volume. Global growth forecasters predict that the pharma industry in India will grow by a whopping 754% by 2060 

If you want to start a business that will bring in steady profits, starting a medical store is your best bet. This option is perfect for people with limited space and less capital.

However, starting a medical shop is just a step in the business. Running it is another ballgame. As you deal with sick people, you need to be responsible enough to give them the correct medication. A small error on your part might have big repercussions for the patients. Due to this, medical shop owners have to follow certain legal procedures and should have their documents in order.

Deciding the Type of Medical Store

Before proceeding with other formalities, you have to decide the type of medical shop you wish to own. There are different options available:

Hospital medical store

These shops are located inside a hospital complex and cater to the patients visiting the hospital.

Clinical medical store

These medical shops are present in hospitals and medical centres and aim at providing optimal quantities of drugs.

Standalone medical store

These medical shops are the most common ones and are often found in residential areas.

Franchise medical store

Franchise medical shops or chain pharmacies are usually present in malls or near hospitals, and they are a part of bigger pharma chains.

Township medical store

These medical shops are set up in a residential or commercial township, and they cater to the customers of the township.

Industrial medical store

These medical shops consist of the pharma industry and include pharmaceutical products’ research, production, marketing, etc..

Government premises medical store

These stores are set up in government-run hospitals and dispensaries and cater to the patients of those hospitals.

Consulting medical store

These stores are comparatively new, having started in 1990. They focus on the theoretical aspects of medicines rather than sales.

Regulatory medical store

They are also known as government medical shops and regulate safe drug use.

Homecare medical store

They are based at a patient’s home and are present to help critically ill homebound patients. They are also known as infusion pharmacies, as only injectable drugs are dispensed.

Mail order medical store and online medical store

They are newly emerging in India as many people are opting to order their prescribed medicines through online apps and websites.

Requirements for Starting a Medical Shop

Now that you have decided the type of medical shop you will start, here is a list of things you need to have in hand before you register for your shop:

Pharmacy licence

This is the primary and most important requirement. We will be discussing this point in detail later in this article, but here are the basics. The owner of a medical shop should be a qualified pharmacist; he needs to have a B. Pharm or M. Pharm degree. If the owner is not a pharmacist, he can employ a registered pharmacist.

Land registration

Next, proceed with land registration. The minimum requirement for a retail store is 10 square metres, and for a wholesale store, it is 15 square metres. You could also combine wholesale and retail in your medical shop.

If you rent a space, you need to have a rental agreement. If you are using your own land, you need to have the relevant ownership documents. If you are buying a shop, you need to have a sales deed. In any case, it would be better for you if you took legal aid to overcome any problems.

Medical shop registration

Every medical shop in India needs to be registered under the Indian Pharmacy Act 1948. Under this Act, you are required to submit all the necessary documents for the state government. If your application is complete and all the conditions are fulfilled, you will be registered under the Act.

While registering, you must also decide what type of company your store will be, whether a sole proprietorship or a partnership. In recent times, limited liability partnership (LLP) has been preferred by many people as it gives benefits to all partners. 

Business registration

Once you have decided the type of business you want to establish, you can register for it. The different types of companies are:

  • Proprietorship
  • Partnership
  • One person company
  • Private limited
  • Limited liability partnership (LLP)

Establishment registration

Depending on the store’s location, you must get it registered with the local body (municipal corporation, municipality, etc.) and obtain their permission.

Tax registration

You must acquire a Goods and Service Tax (GST) registration if you plan to run any business in India. If your turnover exceeds INR 40 lakhs (or INR 20 lakhs for certain states), you must undergo this registration. You can check the limit for your state before proceeding.

Drug licence registration

This is one of the most important documents you need before starting a medical shop. Whether you plan to open a small store, a big one, a chain pharmacy, or one attached to a hospital, you need to have a drug licence. You can either obtain a retail drug licence (RDL) or a wholesale drug licence (WDL).

Licence Requirements for Starting a Medical Shop

You must obtain a drug licence to start a medical shop in India. Besides, you will need a pharmacy licence for selling medicines and a retail or wholesale medical shop licence. A retail drug licence is required if you have decided to open a general medical store, while a wholesale drug licence will allow you to sell drugs at wholesale rates.

You will also require a degree in Pharmacology (B. Pharm or M. Pharm) to obtain a pharmacy licence. However, if you do not have a degree, you may approach a pharmacist who can apply for the licence in return for payment.

All other staff you hire for the store should also be competent enough to sell medicines to customers. They can be

  • A graduate who has one year of experience in selling drugs
  • A registered pharmacist
  • A person who has passed 10th standard and has four years of experience in selling drugs

If you fulfil all the criteria mentioned above, you can get a pharmacy licence and a medical shop licence.

Applying for a Pharmacy Licence

A pharmacy licence is mandatory to start a medical shop in India. You can apply for a medical licence in India from the following organisations:

  • Central Drugs Standard Control Organisation
  • State Drugs Standard Control Organisation

You can fill out the application form along with a fee, and if you meet the eligibility criteria, you can obtain a pharmacy licence.

Documents Required for a Medical Shop Licence

Following is a list of documents that you will need for obtaining a medical shop licence:

  • Application form (completely and correctly filled)
  • Cover letter stating the intent of the applicant with signature
  • Receipt for fees paid
  • Declaration form filled by the applicant
  • Plans and blueprint of the premises
  • Proof of ownership of the premises, if it is rented
  • Identity proof of the owners with passport-size photographs
  • Proof of Constitution of Medical Store (Partnership deed, MOA, AOA, Incorporation Certificate, etc.)
  • Proof of non-conviction of owners as per Drugs and Cosmetics Act 1940
  • Affidavit of a registered pharmacist working full-time or a competent person
  • Appointment letter of the pharmacist or the competent person, if they are employed

When you submit these documents, you can get your medical store license.

Additional Requirements for Obtaining a Drug Licence

Area specification

The shop area should be a minimum of 10 square metres for retail stores and 15 square metres for wholesale stores.

Storage facility

As several medicines need to be stored at low temperatures and most medications should not be exposed to heat, a medical shop must have a refrigerator and air conditioning for proper storage.

Technical staff

If there are any staff in your shop, there are certain rules you must follow:

  • For wholesale stores, the staff must be registered pharmacists with one year of experience in drug sales or a person who has passed their 10th standard and has at least four years of experience in drug sales.
  • For retail shops, a registered pharmacist should be present when medicines are distributed during working hours.

Financing Your Medical Store

Finance plays a key part in starting any business. Starting a medical store is no different. However, it could be a huge task for someone with little capital.

The minimum requirement for a small medical shop would be around INR 15 to 20 lakhs. Once your business is settled, you can gradually expand the scale of your business.

There are two ways to source funds:

Owned funds

You can use your savings to start a medical shop on a small scale. This is a way of earning profits using a lesser capital. 

Owed funds

If you do not want to dip into your savings or you do not have enough funds, you can apply for a loan from banks and financial institutions, many of which offer loans on easy terms and at affordable interest rates.

Applying for a Loan to Start a Medical Shop

You will need the following documents for submitting a loan application for your medical store:

  • Identity proof of the owner, partners, and directors, if any
  • Proof of Indian citizenship and proof of residence
  • Age proof (age must be between 25 to 66 years)
  • Business registration proof
  • Bank statements and Income Tax returns

Opening a Medical Shop in India and Running It Successfully

Starting a medical shop is just one step in your journey. If you want to reap profits from your medical store business, you must factor in a few points.


Choosing a good location is integral to the success of your store. You must select a place that has enough population, but you must also check whether you have many competitors in the area. If there is a hospital or a clinic nearby, it could increase the footfall at your store.


You can contact a pharma company or the local wholesaler for supplies. If you manage to get a direct supply from the company, it will increase your profit margins. However, if you have less capital or less space, it is better to approach a wholesaler.


Building contacts within your fraternity can help your business tremendously. You can even form tie-ups with the nearest doctors so that they refer their patients to you.


It is important to have skilled personnel to carry out sales at your store. However, there are some conditions that they need to fulfil before you can appoint them. Make sure you are completely sure of their experience before appointing them at your store.


Your medical store must have enough storage to stock medicines in proper conditions. If you can afford a refrigerator and air conditioner, you can significantly increase the number of medicines. Make sure you have well-maintained racks and cupboards to stock the supplies so that you can see them quickly.


As with any business, a medical store needs promotion too. You can promote your medical store by distributing pamphlets in your area. You can offer discounts and free goodies to attract customers in the first few days. You can also add services like home delivery to increase your clientele.


Technology has made a significant change to every part of our lives, and running a medical store is no different. Technology can simplify tasks such as inventory, accounting, billing, etc. 


This is an important part of running a medical store. Whether over-the-counter (OTC) or doctor prescribed, every medicine should be dispensed only with a proper prescription. It is mandatory for the owner or the salesperson to check the prescription properly or even consult the doctor before selling a medicine.

Starting an Online Medical Shop

People have started turning to online stores for their shopping needs. Online medical stores are new in the Indian market, but they are making significant progress. They are helpful for senior citizens and people who might find it difficult to visit a physical shop. They also offer good discounts in their prices.

Online medical shops do not have a set geographic location to serve their customers. However, in some cases, they can source lesser-known or hard-to-obtain medicines for their clients.

There are certain limitations while running an online medical shop. Sometimes, you have to refill drugs periodically without checking prescriptions. This may lead to issues for the patient.

To start an online medical store, you need to:

  • Hire a qualified pharmacist
  • Obtain Food and Drug Administration (FDA) and Food Safety and Standards Authority of India (FSSAI) licences
  • Obtain licences from local bodies
  • Tie up with local pharmacies
  • Have an arrangement with courier companies
  • Set up a proper website and app that allows the customers to order and pay smoothly
  • Do digital marketing


The pharma industry is growing by leaps and bounds, and it makes sense to jump on the bandwagon. If you plan to start a medical store, you can go through proper legal and financial processes to make your dream come true. If you take the proper steps, your medical shop will prosper.

Frequently Asked Questions

How much funds are needed to open a medical shop?

In metropolitan cities, you might need around INR 7 to 10 lakhs. In suburban areas and towns, you might need around INR 3 to 5 lakhs approximately.

What are the different documents required to start a medical shop?

You will need:
- Rental agreement/proof of ownership
- Blueprint of premises
- Drug licence

Is a chemist shop a profitable business?

Yes, a chemist shop or medical store is a very profitable business mainly because of the rapid growth of the pharma industry and the requirement of medicines.

Which degree is required to open a medical shop?

To open a medical shop, you need to complete graduation or post-graduation in Pharmacology (B. Pharm or M. Pharm). You could also do a Diploma in Pharmacy after passing your 12th standard in the Science stream.

Can a doctor run a pharmacy?

No, a doctor is not allowed to run a pharmacy. Only a registered pharmacist can open a medical shop.

Who can start a medical shop?

Anyone can open a medical shop, but it is preferable if you have a degree in Pharmacology. If you do not have a degree, you can hire a pharmacist. A drug licence will be issued only to a registered pharmacist.

Can a nurse open a pharmacy?

No, a nurse cannot start a medical shop in India.

Is a pharmacist a medical professional?

Yes, a pharmacist is a medical professional who specialises in:
- Health and wellness testing
- Chronic disease management
- Medication management
- Immunisation administration

Which course is best for starting a medical shop?

B. Pharm and M. Pharm are the ideal courses for starting a medical shop. You can also do a Diploma in Pharmacology after your 12th standard.

Is there any special licence for selling Ayurvedic, Unani, and Homoeopathy medicines?

Yes, you need a licence from the Ayurveda, Yoga and Naturopathy, Unani, Siddha, and Homoeopathy (AYUSH) Ministry to sell Ayurvedic, Unani, and Homoeopathic medicines.

Do I need a special licence for selling dietary supplements?

Yes, you need a licence from the Food Safety and Standards Authority of India (FSSAI) to sell dietary supplements.

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