Proposal to regulate prices of non-scheduled drugs under DoP consideration

Gireesh Babu, New DelhiMonday, March 27, 2023, 08:00 Hrs  [IST]

A proposal to regulate the prices of non-scheduled drugs, on similar lines of the previous measures to cap the prices of select anti-cancer medicines and regulate the prices of medical devices including pulse oximeter and blood pressure monitoring machine during the Covid-19 times, is under the consideration of the Department of Pharmaceuticals (DoP).

The move, which has been considered by the Department in the previous years, was opposed by the pharmaceutical industry, especially the small and medium scale firms, as it could affect their revenue and impact their very existence in the sector.

The DoP has informed the Department Related Parliamentary Standing Committee on Chemicals and Fertilisers, which has come out with a report on the Demand for Grants for the DoP for 2023-24, that a proposal to regulate the prices of non-scheduled drugs has been forwarded to the DoP by the relevant authority for consideration.

The DoP informed the Committee, headed by Member of Parliament Shashi Tharoor, that “NPPA has capped trade margin of non-scheduled formulations of 42 select anti-cancer medicines under “Trade Margin Rationalization” approach as a pilot for proof of concept in February, 2019. Further, TMR approach was used to regulate the price of oxygen concentrators, pulse oximeter, blood pressure monitoring machine, nebulizer, digital thermometer and glucometer under “Trade Margin Rationalization” Approach in June/July 2021.”

“On similar lines, to regulate the prices of non- scheduled drugs, proposal has been forwarded to DoP for consideration,” it added.

The Committee observed that since its establishment in 1997, NPPA has been able to regulate prices of only 20 percent drug formulations under scheduled drugs category whereas 80 percent of non-scheduled drugs are still under 10 per cent annual ceiling price.

“The Committee would also desire to be apprised of the progress with regard to the proposal to regulate the prices of non-scheduled drugs which is under consideration of the DoP,” said the Committee in its latest report.

The NPPA is proposed to initiate various steps during 2023-24 including exploring new pricing methodology for rationalizing the high trade margin in selected drugs; exploring schemes for reducing the litigation burden and take old cases to logical conclusion; and exploring the possibility of putting in place a system for tracking the availability of drugs in the supply chain for ensuring last mile availability in consultation with various stakeholders.

Besides, it would carry out the other programmes such as fixation of ceiling prices fixation of remaining scheduled formulation/medical devices under National List of Essential Medicines (NLEM), 2022 (not fixed during 2022-23) and monitoring the ceiling price implemented by companies; fixation of retail prices of new drugs and monitoring the price revision of Non-Scheduled formulations/medical devices (annual 10%) and of Scheduled formulations (WPI basis); and initiating necessary action to avoid shortages of essential medicines. Increase public awareness through webinars, etc. It is also expected to meet full operationalization of IPDMS 2.0- office automation, submitted the NPPA.

“The Committee desire that NPPA being the national drug price regulator should put in extra efforts for access by common man to affordable medicines and medical devices and therefore DoP/NPPA shall jointly resolve the challenges in the way of effective implementation of the provisions of Drugs Price Control Order 2013 to ensure that maximum formulations are covered under the scheduled drug price regulation in the minimum time possible. The Committee would like to be apprised of the progress in this regard from time to time,” recommended the Committee.

The Committee asked about the challenges being faced by the NPPA when it comes to implementation of the Drugs Price (Control Order) DPCO in the States and Union Territories. In reply, it has been informed that PMRUs are not being fully operational in some States/UTs due to non-recruitment of staff or timely renewal of their contracts; and yet to be established in others. Continuous follow up and meetings are being conducted with senior officials of the States/ UTs.