Expert panel recommends expanding NPPA's mandate

The National Pharmaceutical Pricing Authority (NPPA)’s mandate will no longer be limited to fixing the prices of drugs mentioned in the National List of Essential Medicines (NLEM), according to the recommendations of an expert committee on restructuring NPPA. 

“It (NPPA) will be given the authority to assess and choose which drug ought to be brought under the price fixation category,” a senior government official who is aware of this recommendation told Business Standard. This essentially widens the scope of the NPPA to regulate prices. 

At present, the NPPA monitors drugs that are part of NLEM and identifies players that overcharge. Issues on overcharging and price cap have been areas of tension between the pharmaceutical industry and the NPPA. Not agreeing with various drug price orders, the players have appealed to the Department of Pharmaceuticals for several cases in the past. 

NPPA has to recover a total of Rs 4,567 crore, including interest, from various pharma companies for overcharging as of June this year.

In 1,389 cases, demand notices have been issued by NPPA to pharmaceutical companies. 

Further, the NPPA has been issuing show-cause notices to drug manufacturers for not registering with the Integrated Pharmaceutical Database Management System, where the companies would declare their products to the drug price regulator. 

NPPA’s mandate is to fix or revise the prices of controlled bulk drugs, formulations and to enforce prices and availability of the medicines in the country. It has been entrusted with fixation of prices of scheduled drugs under the Drug (Price Control) Order, 1995 (DPCO) 1995 and DPCO 2013. 

NPPA is waiting for the Department of Pharmaceuticals to amend the DPCO 2013 and give it direction to fix prices of those drugs for which the regulator doesn’t possess details like in the case of stents.