Manufacturers asked to revise MRP for drugs with nil, reduced customs duty

All drug manufacturers and marketers will have to revise the maximum retail price (MRP) for drugs that received a reduction or exemption from customs duty in this year’s Union Budget, the national pharma pricing regulator has said.

 

In an office memorandum released on Monday, the National Pharmaceutical Pricing Authority (NPPA) asked manufacturers to revise MRPs for 36 drugs that received an exemption from customs duty and six drugs that now attract a concessional duty of 5 per cent.

 

In her budget speech, Finance Minister Nirmala Sitharaman announced the exemption of 36 drugs used to treat cancer, rare diseases, and other severe chronic diseases from the basic customs duty (BCD).

 

This includes Mepolizumab, used to treat severe asthma, and anticancer drugs such as Asciminib and Daratumumab, among others.

 

Sitharaman also announced the addition of six drugs to the list attracting a concessional customs duty of 5 per cent. This includes Brentuximab Vedotin, used to treat cancer, and multiple sclerosis medication Ocrelizumab.

 

The NPPA has also asked manufacturers to issue a price list or supplementary price list to dealers, state drug controllers, and the government, and submit information about the price revision through Forms 2 and 5.

 

While Form 2 is used to submit revised prices for scheduled formulations, Form 5 is used to submit price lists for scheduled and non-scheduled formulations.

 

According to the Drugs (Prices Control) Order, 2013 (DPCO), the MRP of drugs and formulations is inclusive of taxes and duties, as applicable.

 

“Hence, any downward change in duties and taxes should be reflected in the MRP, and the benefit of nil duty or a reduction in duty/taxes should be passed on to customers,” the pharma pricing regulator added.