What should pharmacy billing software do? It has to print the cash memo the law asks for. That means your name, address and drug licence number, a serial number, and each medicine and its quantity.
It should also track batch and expiry, which the rule asks for on some prescription sales, and charge the right GST. That is 5% on most medicines.
What you need beyond that depends on how you sell. A chemist who fills prescriptions keeps more records than one who only sells over the counter, and Schedule H1 drugs need a register of their own.
This post covers what a chemist’s bill must carry by law, the software features that follow, and how GST works on a pharmacy bill.
Key Takeaways
- Every medicine sale needs a numbered memo with your licence number. Software that cannot print it fails on bill one.
- Record batch and expiry on each line. They let you trace any strip back to its supplier.
- Schedule H1 drugs need their own register for three years. Check this before you buy.
What Must a Chemist Bill Carry Under the Law?
A chemist’s bill must carry the details set out in Rule 65 of the Drugs and Cosmetics Rules, 1945. This section shows what the rule asks for at each level of sale.
The rule works in levels. Every retail sale needs a memo, and a prescription sale needs more detail. Some scheduled drugs need more again, and Schedule H1 drugs need a register of their own.
| Pharmacy billing record | What it must carry |
|---|---|
| Every retail sale (cash or credit memo) | Your name, address and sale licence number; the memo’s serial number; the name and quantity of each drug |
| Prescription sale (register or memo book) | Serial number, date, the prescriber’s and patient’s names and addresses, the drug and quantity, the pharmacist’s signature |
| Schedule C, H or H1 drug on prescription | All of the above, plus the manufacturer, batch number and expiry date |
| Schedule H1 drug | A separate register with the prescriber, patient, drug and quantity, kept for three years |
These details come from Rule 65 of the Drugs and Cosmetics Rules. The copy is published by the drugs regulator, the Central Drugs Standard Control Organisation (CDSCO). The rule also asks you to keep a copy of every memo.
For medicines sold in the original pack, the rule lets you use a numbered memo book instead of a register. You choose this in writing when you apply for or renew your licence.
Chemist’s name and address Drug licence number Memo serial number Each drug and its quantity On prescription sales, also: Prescriber and patient details Batch and expiry (Schedule C, H, H1) What a chemist’s memo carries under Rule 65 of the Drugs and Cosmetics Rules.The first four boxes go on every memo. The last two are added on prescription sales. Batch and expiry apply to the scheduled drugs in the table.
If your memos come from billing software, each prescription memo still needs every detail in the prescription row of the table. Check with your state drugs controller how they want the copies kept.
What Should Pharmacy Billing Software Do?
Pharmacy billing software should do six things. Most follow from the rule above or from GST, and the rest protect your counter. This section takes them in turn.
1. Print your licence and serial number on every memo
The rule asks for your name, address and sale licence number on every retail memo, with a serial number. Set these once in the bill header, so no bill goes out without them.
2. Record batch and expiry on each line
For Schedule C, H and H1 drugs on prescription, the rule asks for the manufacturer, batch and expiry. Software that picks the batch when you scan the strip records this without extra typing.
3. Warn you before an expired batch is sold
Expiry tracking also protects the counter. A chemist in Thane with 1,800 product lines cannot check every strip by eye, so the software should flag stock close to expiry (an example).
4. Keep purchase records the rule asks for
Rule 65 asks you to record each purchase too. That means the date, the supplier and their licence number, the drug, the quantity, the batch and the maker. Enter purchases in the same software, so sales and purchases sit together.
5. Charge the right GST rate per item
Medicines and the other items on your shelves can carry different GST rates. The software needs a rate on each item, not one rate for the whole bill. Our comparison of manual billing vs software covers why this is hard by hand.
6. Handle returns as credit notes
Customers return unopened strips. Record each one as a credit note against the original bill, so stock and GST stay right.
Suppliers also take back near-expiry stock. Take a pharmacy in Aundh sending ₹1,24,800 of it back to its distributor in March 2026 (an example). The distributor’s credit note should be matched to the purchase bills it covers.
What I would set up first. I would load every medicine with its batch and expiry from the latest purchase bills before the first sale. Then the first strip scanned already carries the right batch on the bill.
How Should Pharmacy Billing Software Handle GST?
GST on most medicines is 5%, and pharmacy billing software has to apply it item by item. This section shows the rate and how the tax is worked out.
Medicaments under headings 3003 and 3004 sit in the 5% schedule of the government’s GST rate notification, in force since 22 September 2025. That covers most tablets, syrups and capsules sold in retail packs.
When your selling price already includes GST, the software has to work the tax backwards. Here is how that works on one bill (an example):
- A medicine sells for ₹210, including 5% GST.
- The price before tax is ₹210 ÷ 1.05 = ₹200.
- The GST is ₹10. For a sale within your state, that splits as ₹5 Central GST (CGST) and ₹5 State GST (SGST).
Do this by hand on a busy evening and the split goes wrong. Software that holds the rate on each item does it on every line.
Where Does Petpooja Invoice Fit for a Pharmacy?
Petpooja Invoice covers the billing, stock and GST side of a pharmacy. This section sets out what it handles, and what to confirm before you switch.
Its batch and expiry tracking, on the Advanced plan, records both on each item. Its barcode scanning brings the item onto the bill in one scan. It also handles GST invoicing, real-time stock, and returns, refunds and exchanges. Our Petpooja Invoice features guide has the full list.
Before you switch, ask how the software handles the prescription register and the Schedule H1 register. Ask the same of every option you compare. These registers are where pharmacy billing differs most from a normal shop bill.
Still on paper? Our pharmacy billing template sets out the columns a compliant memo needs.
Which Pharmacy Billing Software Mistakes Should You Avoid?
The four to avoid are a memo without your licence number, H1 sales in the general register, purchases without the batch, and one GST rate for everything. Each is small on the day and costly at an inspection.
- A memo without the licence number. The rule asks for it on every retail memo. Set it in the bill header once.
- H1 sales mixed into the general register. Schedule H1 drugs need their own register, kept for three years.
- Purchases recorded without the batch. Without it, you cannot trace a strip back to the supplier who sold it.
- One GST rate for everything. A bill with a medicine and a cosmetic on it can carry two rates.
A clinic dispensary in Kharadi and a hospital pharmacy in Gachibowli face the same four risks (an example). Our guide to the best billing software for retail shops covers the wider choice.
What Happens If a Chemist Bill Breaks Rule 65?
If a chemist bill or register breaks Rule 65, the licensing authority can suspend or cancel the drug licence. This section explains how that works under Rule 66.
First comes a notice. The authority must give you a chance to explain why it should not act. If it still finds you failed to meet the licence conditions or the rules, it can suspend the licence or cancel it, for all drugs or only some.
A mistake by a staff member is treated differently. The licence is not suspended or cancelled if you can show certain things. For example, that you did not encourage it, or that you took due care to follow the rules. A complete, dated set of memos and registers helps show that care.
If your licence is suspended or cancelled, you can appeal to the State Government within three months of the order.
Conclusion
Pharmacy billing software has to print the memo Rule 65 asks for. That means your name, address and licence number, a serial number, and each drug and quantity. It should also record batch and expiry, and charge 5% GST on most medicines.
Start with the prescription records and the Schedule H1 register. That is where pharmacy billing is different, so check those first.
A chemist’s bill is a legal record as much as a receipt. Petpooja Invoice keeps the batch, expiry, stock and GST behind each one in one place.
Frequently Asked Questions
How much does pharmacy billing software cost?
It depends on the plan and the number of counters and branches. Our guide to retail billing software prices compares what affects the cost.
Do Ayurvedic and homoeopathic medicines get the same GST rate?
Yes, most do. The 5% entries for headings 3003 and 3004 name Ayurvedic, Unani, Siddha, homoeopathic and bio-chemic medicines too.
Thanks. This helps us make the next article better.
Ashwiniba Vaghela is Senior Executive – Content at Petpooja and the editorial reviewer, which means she also helps in reviewing blogs. She writes the explainers and comparisons people read before they know what to search for: what a category actually is, what it costs to keep doing the job by hand, and which differences between two tools matter once you are running a business rather than evaluating one. Much of her work is built on Petpooja's own numbers rather than borrowed industry reports, and with 1,50,000+ businesses, the patterns in that data answer questions no public survey covers. If you are trying to understand something before you commit money to it, Ashwini is writing for you, and if you have read anything else on this blog, she has already checked it.
