Soaring medicine prices under Centre scrutiny

The Centre is examining the market prices of medicines for cancer, diabetes, heart diseases, tuberculosis and malaria besides prices of sera and vaccines with the objective of fixing their selling rates if their retail prices are too high for the consumers.

The National Pharmaceutical Pricing Authority monitors the “intra-band price differences” for drugs outside the price control on the basis of monthly MRP-based data to check if the price difference between various brands exceeds 25 per cent. The government will intervene if difference is too high.

“The exercise would be carried out for anti-cancer, HIV-medicines, anti-tuberculosis, anti-malaria, cardiovascular, anti-diabetics, anti-asthmatic and vaccines,” NPPA says in an internal guideline.

From the data, NPPA would identify the cases where the maximum retail price of brands exceeds 25 per cent of the simple average price of the medicines in that group. If the threshold is breached, the government has the option to intervene using a special power to fix that medicine’s price. 

The NPPA’s special power comes from the paragraph 19 of Drug Price Control Order of 2013, which was notified last year.  This was invoked by the NPPA on July 10 to fix the prices of 108 formulations (with 50 medicines), mostly related to diabetes and heart diseases. The government took the step after discovering huge price differences of more than 300-400 per cent among various brands for medicines of a particular group.

“These 50 drugs are not covered by the national list of essential medicine,” said C M Gulhati, a former World Health Organisation consultant. The NLEM brings 348 molecules — contributing close to 700 formulations — under price control whereas the 550 medicines remain outside price regulation. As per the NPPA guideline, the category of therapeutic drugs can be expanded later.

The industry is up in the arms against the NPPA decision. Two associations of pharmaceutical companies have moved the Delhi and Bombay high courts challenging the move. “The NPPA has exceeded its mandate,” Ranjana Smetacek, OPPI director general, told Deccan Herald.