NDA government more eager to cap drug prices than UPA

The new essential medicines list has seen 106 drugs against just 43 drugs added in 2011 under the UPA rule

The new National List of Essential Medicines (NLEM), notified by the NDA government on December 25 last year, has added 106 drugs and removed 70. In contrast, the previous NLEM — prepared under the UPA government in 2011 — added just 43 drugs and removed 47. As drug pricing control policy is made according to NLEM, it is estimated that the pharma industry will take a hit of Rs 6,000 crore this year.

This is just one of the many steps which the new government has taken which shows that its eagerness to cap drug prices is way more than the previous government.

 

The Prime Minister's Office (PMO) expressed concern to the Department of Pharmaceuticals (DoP) last November over exorbitant prices of unbranded generic drugs, which companies sell directly to distributors. After setting a committee under one of its joint secretary — which has submitted its report — the DoP is now planning to cap the prices this month itself. 

Earlier, in July 2014, the National Pharmaceutical Pricing Authority (NPPA), which formulates the drug pricing control policy, had issued guidelines in order to bring 106 non-NLEM drugs — used to treat cardiovascular diseases and diabetes — under the pricing control, calling them 'essential'.

However, after two months only, the NPPA withdrew these internal guidelines, giving a major relief to the pharma industry which believed that such a definition of 'essential medicines' — where it considered non NLEM drugs as essential - could bring entire pharmaceutical industry under pricing control.

“The government is truly trying some piecemeal measures such as these in order to make drugs affordable. However, the new NLEM is unlikely to give any major benefit to the patients as many life-saving drugs are still not included in it,” said a Delhi-based pharma expert.

In the recently-notified NLEM, the government has added nine and 14 new anti tuberculosis medicines and anti viral medicines respectively. Moreover, 25 new anti neoplastic medicines, immunosuppressives and medicines used in palliative care have also been added. As a result, in new NLEM, there are 384 drugs instead of just 348 drugs in the old one.

“The current scenario is unique with an increase in the burden of non-communicable diseases and resurgence of certain communicable diseases either due to emergence of drug resistance, like in tuberculosis and malaria, or occurrence of certain co-infections like HIV and TB, etc” said the committee which recommended the NLEM.

According to an analyst, the impact from NELM on the Indian pharmaceutical industry is estimated to be around Rs 6,000 crore. “Around 5 to 7% of the companies would be affected. However, as the government is looking at the medicines from affordability and inflationary point of view, it is quite understandable that they have added more drugs in the list,” he added.