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DoP rejects Blue Cross Labs’ review petition against ceiling price fixation of “Mefenamic acid - tablets 250mg and 500mg”

Ramesh Shankar, Mumbai
Tuesday, January 2, 2018, 08:00 Hrs  [IST]

The Department of Pharmaceuticals (DoP) has rejected a review application of Blue Cross Laboratories against price fixation of “Mefenamic acid - tablets 250mg and 500mg”.

In the review petition, the petitioner contended that the NPPA is not justified in applying the WPI reduction by 2.7105%, which is unfair and contrary to the provisions of the DPCO 2013. It is apparent that the aforesaid Notification has been issued for ‘fixing’ for the first time the Ceiling Prices in respect of the formulations mentioned therein, which includes our subject formulations, in view of their inclusion in the revised NLEM 2015.

The applicability of Para 16 is appropriate only in the cases where there is revision of prices. However, there is no revision involved in fixing the ceiling price of product that has become scheduled drug for the first time. Since it is a case of fixation of price of a formulation that has become scheduled for the first time, the concept of applicability of WPI does not seem to be correct.

Since the Ceiling price is fixed in respect of the subject formulation for the first time, the concept of “revision” cannot apply and consequently the provisions of paragraphs 16 & 18, both of which deal with “revision” cannot be attracted and the question of applying any effect of the WPI change does not arise. Hence, applying WPI without the ceiling price having been fixed is not in accordance with the provisions of DPCO 2013. In view of the above, NPPA has erred in applying WPI in this case where it is not applicable.

During examination of the case, the DoP noted that in the instant case, the company’s contention is that application of negative WPI @-2.7105 while fixation of ceiling price of the formulations mefenamic acid - tablets 250mg and 500mg. Is not in accordance with the provisions of DPCO, 2013.

In this regard, it is submitted that para 9(5) of DPCO, 2013 reads as under: “The market based data for fixing the ceiling price of a scheduled formulation due to a revision in the first schedule shall be the data available for the month ending immediately before six months of notification of revision in the first schedule.”

In this case, the products mefenamic acid – tablet-250mg and 500mg have become scheduled formulations vide DoP’s SO 701(E), dated 10.3.2016. As per para 9(5) of
DPCO, 2013, while fixing the ceiling price, the data to be considered is of six months prior to notification, i.e. August, 2015 in this case. Hence the WPI factor will apply in the instant case.

In view of the above, the hearing authority is of the opinion that NPPA has fixed the ceiling prices of mefenamic acid – tablet-250mg and 500mg as per para 9(5) of DPCO, 2013 and factoring WPI is in order, as the base data is of August, 2015. Hence, the grievance of the petitioner company has got no merit and may be rejected.

“NPPA has fixed the ceiling prices of Mefenamic Acid – Tablet-250mg and 500mg as per para 9(5) of DPCO, 2013 and factoring WPI is in order, as the base data is of August, 2015. Hence, the grievance of the petitioner company has got no merit and stands rejected,” the DoP ordered.

 

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