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			The Centre&#39;s move to control prices of certain drugs under the Drug Price Control Order (DPCO) continues to affect the growth rate of pharmaceutical companies at large.</div>
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			According to latest estimates by ICRA, approximately 17 per cent of the Indian pharmaceutical market &nbsp;is under THE DPCO. The DPCO &nbsp;segment has grown by 1.1 per cent during the first quarter of 2016-17, which has dragged the overall growth of the Indian pharmaceutical market down to 6.4 per cent.</div>
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			In 2015-16, the DPCO portfolio grew 7.7 per cent compared to 13.7 per cent for the non-DPCO portfolio. This reduced overall growth to 12.6 per cent in 2015-16.&nbsp;</div>
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			SV Veeramani, president of the Indian Drug Manufacturers&#39; Association (IDMA), said while the fixing of prices had not affected the demand of drugs, a price reduction by around 2.2 per cent this year based on the wholesale price index had hurt drug makers. &quot;The big ones are able to make up the margins through volumes, but for smaller manufacturers, the problem is more acute,&quot; he said.</div>
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			On the whole, margins have been hit in the range of 5-15 per cent, say industry insiders.</div>
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			During the period April 1, 2015, to September 30, 2016, the National Pharmaceutical Pricing Authority (NPPA) issued orders covering 577 formulations with an &nbsp;approximate market value of Rs 22,000 crore. The median reduction stood at 16.8 per cent.</div>
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			ICRA estimates that the DPCO portfolio of companies will suffer sluggish growth in 2016-17 owing to a negative WPI movement of 2.7 per cent for calendar year 2015 coupled with price revision of drugs by NPPA.</div>
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			DPCO-controlled formulations prices are revised on yearly basis according to a designated formula in addition to the WPI-based adjustment. During the first six months of 2016-17, the NPPA has &nbsp;notified price revision or fixing for drugs worth approximately Rs 18,000 crore based on the National List of Essential Medicines (NLEM) 2015.</div>
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			While ICRA notes that some of these drugs were already under the DPCO during 2015-16, the NPPA will expand the coverage of &nbsp;DPCO-controlled products. The NPPA is also likely to gradually expand the DPCO coverage to all NLEM 2015 drugs, which represent 18-19 per cent of the Indian pharmaceutical market.</div>
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			Overall, ICRA expects the DPCO segment to grow at 1-3 per cent in 2016-17 while the overall market will grow at 10-12 per cent.</div>
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			In May 2013, the department of pharmaceuticals came out with the Drug Price Control Order covering 348 essential drugs listed under the NELM 2011.</div>
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ICRA expects the DPCO segment of IPM to grow at 1-3 per cent for FY17 while the overall IPM will grow at 10-12 per cent

Pharma exporters hope for a barter-deal with African nations to beat currency blues

The Centre's move to control prices of certain drugs under the Drug Price Control Order (DPCO) continues to affect the growth rate of pharma companies at large. According to latest estimates from ICRA approximately 17 per cent of the Indian Pharma Market (IPM) is under DPCO.  The DPCO drugs segment has grown by 1.1 per cent during the first quarter of FY17 which has dragged the overall IPM growth to 6.4 per cent. In FY16, the DPCO portfolio grew 7.7 per cent compared to 13.7 per cent for the non-DPCO portfolio. This reduced the overall IPM growth to 12.6 per cent for FY 2016. S V Veeramani, president of Indian Drug Manufacturers' Association (IDMA) said that while the fixing of prices has not affected the demand of drugs, but a price reduction (by around 2.2 per cent this year based on WPI) has indeed hurt drug makers. "The big ones are able to make up for the margins through volumes, but for smaller manufacturers, the problem is more acute,"he said. On the whole, margins have been hit

Drug Price Control Order continues to drag growth of pharma industry

ICRA expects the DPCO segment of IPM to grow at 1-3 per cent for FY17 while the overall IPM will grow at 10-12 per cent

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