|
The National Pharmaceutical Pricing Authority (NPPA) was established by the Centre in the year 1997 to fix ceiling prices to all drugs notified under Schedule-I and to monitor annual price increase of these scheduled drugs and the non-scheduled drugs. Ever since the first Drug Price Control Order (DPCO) was announced by the government way back in 1979 to make essential drugs available at affordable prices, overcharging of drug prices by the pharmaceutical companies has been a major issue. Violations of DPCO provisions by way of either circumventions or overcharging by the pharmaceutical companies have since been going on in the country with impunity. As the government brought more drugs under DPCO in 1995, monitoring of drug prices became a daunting task for the government. Under this backdrop, the establishment of an agency like the NPPA was an apt decision. The NPPA's task of monitoring and controlling the drug prices became manifold when the government added more drugs in the DPCO. It is clear that the NPPA strives to strike a balance between the interests of the consumers and the pharma industry within the ambit of the DPCOs. Its role as a regulator is to work towards a healthy nation by making medicines accessible and affordable while creating an enabling environment for the Indian pharmaceutical industry to develop into a world leader. But, as the latest data shows, the NPPA still appears to be struggling to curb violations of ceiling prices fixed by it as the pharma companies have been routinely overcharging a number of life-saving drugs. According to latest data released by the NPPA, at the end of March, 2026, the NPPA cumulatively has a total of 2,732 cases charged on overcharging, with a total overcharged amount standing at a whopping Rs. 10,029.8 crore.
It is obvious that the NPPA is struggling to curb violations of ceiling prices fixed by it. It is very much evident from the fact that over 84 per cent of the total demand raised by the Authority from a large number of pharmaceutical companies on alleged overcharging of prices over the years is yet to be recovered. The NPPA has recently released a data according to which the total amount realised out of the total demand till the end of March, 2026 is Rs. 1,582.4 crore, while around Rs. 8,447.4 crore, which is over 84 per cent of the total demand, is yet to be realised owing to various reasons including cases filed by the companies. But, what is praiseworthy is that the NPPA has achieved significant progress in raising demand on overcharged amounts from the industry for alleged violation of pricing norms and the amount realised against the total demand, during the fiscal year 2025-26 as compared to the previous year. According to data from the Authority, during the year 2025-26, the drug price regulator has raised demand on overcharged prices, including interest, to the tune of around Rs. 72.20 crore, which is almost four times higher than the Rs. 14.52 crore demand raised by it in the previous fiscal year. It has also realised a total amount of Rs. 164.47 crore including from the demands raised during the fiscal and some of the previous demands, during the period, which is almost seven times higher than the Rs. 20.54 crore realised during the 12 months of previous fiscal year. Now, the NPPA should keep up this momentum and should pull out all the stops to recover the outstanding amount from the pharma companies. Otherwise, the very purpose for which it has been established will be defeated.
|