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Pharma pricing: Govt may revise essential medicines' list soon

While, govt is still in the process of fully implementing new prices fixed for 348 essential medicines, it has realised that most of these are no longer in supply

Sushmi Dey New Delhi
The National List of Essential Medicines (NLEM) — which took a little more than eight years for the government to finalise and another couple of years for the prices to be regulated — could be revised soon.

While the government is still in the process of fully implementing the new prices fixed for 348 essential medicines, it has realised that most of these are no longer in supply. This is because companies have already started manufacturing many of these drugs with either special delivery mechanism (an improved and fast acting version of the basic formulation) or in combination with other ingredients, circumventing price control.

According to an official, the National Pharmaceutical Pricing Authority (NPPA) has written to the department of pharmaceuticals (DoP), seeking its advice. Following NPPA’s letter, the department is considering floating a proposal to revise the NLEM and has also referred the matter to the health ministry. The list was originally prepared by the health ministry, following directions from the apex court.

While the new Drugs Price Control Order (DPCO) came into effect in May bringing 652 packs of 348 essential medicines under price control, NPPA has so far been able to notify prices of merely 338 packs, about half the total.

The regulator says while there is no data available on around 100 medicines about their manufacturers, market size and prices, there are various medicines which are now available as delayed release, sustained release or with other special delivery mechanisms. “The NLEM mentions a plain formulation. If the category is clubbed and if prices are fixed by one parameter, manufacturers are raising objections claiming their product is not the same as the original and is an improvised version with a different mechanism,” an official said. Besides, for various medicines, the NLEM does not mention specific dosage. The drug is available in several dosages and strengths, creating a conflict between the regulator and the industry in determining the price cap. The National Pharmaceutical Pricing Policy suggests capping prices of 348 essential medicines based on the simple arithmetic average of all medicines in a category with market share of more than one per cent.

The industry believes that the revision of the list may not have a direct and immediate impact on it.

“There are provisions for periodical update of NLEM and if the government decides to do it now, the exercise will take some time as it is a long-drawn process. Besides, it may impact the industry only if the DoP takes a view that the list has to be brought under price control,” says Indian Pharmaceutical Alliance (IPA) Secretary General DG Shah.

Industry analysts and many health activists, however, feel that the latest development only depicts the unpreparedness and “lack of foresight” of the government. “This is a disgusting situation for consumers. The NLEM was prepared through an apex court order asking the government to bring essential medicines under price control and after so many years all that the government could do is regulate prices of medicines which are already out of the market. This shows the lack of foresight and research by the government,” said a health activist working to make essential drugs affordable.


2003: SC disbands Pharma Policy 2002 (proposed to bring down number of bulk drugs under price control from 74 to 38), saying it would dilute price control regulation

2003: SC asks the govt to finalise a new list of all essential drugs, bringing these under price control

2007: First GoM formed to formulate the policy; holds four meetings through 2007 and 2008, but could not make any recommendations

2009: GoM reconstituted when UPA-II returns to power

Jun ‘11: Health ministry gives a National List of Essential Medicines with 348 formulations and combinations

Oct ‘11: DoP floats a draft National Pharmaceutical Pricing Policy that proposes to cap the prices of 348 essential medicines

Mar ‘12: GoM meets to consider the proposed policy

Sep ’12: SC slams the govt for delay in policy formation

Nov ’12: Cabinet gives a nod to National Pharmaceutical Pricing Policy, bringing in 348 essential medicines under price control

May ’12: Govt notifies new Drugs Price Control Order to implement prices of medicines

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First Published: Nov 06 2013 | 12:24 AM IST

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