Government to Amend Norms in 15 Days For Fixing Prices of 350 Essential Medicines

India will expand the ambit of the essential medicines pricing body to include those where market data for medicines cannot be sourced.

“The prices for 350 essential medicines are not available. We have asked the government to make an enabling clause to allow the NPPA to fix the prices of these medicines,” Bhupendra Singh, chairman of the National Pharmaceutical Pricing Authority said.

Minister for Chemicals and Fertilisers, Anant Kumar noted that this enabling provision will be made in the next 15 days. The pharmaceutical industry in India is regulated by the Department of Pharmaceuticals which is a sub-division of the Ministry of Chemicals, Petrochemicals and Fertilizers.

The NPPA seeks the ability to source price data for less consumed essential medicines from hospitals, Singh told BloombergQuint. “Though there may be no direct impact off-the-counter, we expect a 10-15% reduction in the overall cost of treatment through this. Prices of products such as surgical cotton will be brought down through this revision,” he added.

Under the existing law, the NPPA fixes a price ceiling for essential medicines. “The NPPA has shifted from specifying a cost-based price to a market average mechanism,” KB Agarwal, Joint Secretary, Ministry of Health said.

Currently, the NPPA operates under the Drug Price Control Order (DPCO) 2013. This mandates that NPPA must calculate the ceiling price of an essential medicine by averaging the multiple prices of the same product in the market. The NPPA sources this data from chemists.

The NPPA currently regulates the price of 900 formulations. Kumar also noted that maximum retail prices of an additional 368 formulations have been fixed.