CCI says drug prices high in India due to unreasonable trade margins

The Competition Commission of India (CCI) in a policy note has said drug prices are often high in India because companies resort to “unreasonable” trade margins. 

The regulator, however, stopped short of suggesting price controls. Instead, the note makes a case for the central and state governments to go for large-scale procurement of drugs and other medical supplies to push down prices. 

The anti-trust regulator also notes that the Indian healthcare sector is prone to “various industry practices which have the effect of choking competition and are detrimental to consumer interest”. It goes on to add that these practices often just satisfy the rules of competition but harm consumers. This is a reference to cases where the CCI has imposed penalty but which has been set aside by courts on appeal. “Such practices may not always violate the provisions of the Act, but they create conditions that do not allow markets to work effectively.”

CCI says drug prices high in India due to unreasonable trade margins.