NITI panel to suggest price control of drugs outside NLEM, says Paul

Committee chairman says NPPA should be made independent and stronger

The new high-level committee under NITI Aayog will identify drugs outside the National List of Essential Medicines (NLEM) and recommend pricing caps whenever there’s a need. Speaking to Business Standard, V K Paul, member, NITI Aayog, and chairman of the Standing Committee on Drugs and Health Products, said, “we will recommend changes depending on what’s beneficial to the public, so that one doesn’t have to wait for NLEM to be amended.’’ This would include cancer drugs as well.

The newly formed committee was of the view that price cap should be done in a systematic way, Paul said, while stressing that there was no dilution of powers of the National Pharmaceutical Pricing Authority (NPPA). “Our recommendation is that the NPPA should be made independent and stronger. We will give holistic recommendations to the NPPA,” he said, within days of the committee being announced. 

Until now, the NPPA used to take up drugs in the Schedule 1 of the Drug Price Control Order (DPCO) and rarely looked at others under Para 19 under the order. Schedule 1 drugs are those included in the NLEM, while Para 19 covers extraordinary and emergency circumstances. In the case of stents, the government had used Para 19 to fix the trade margin.  

The view in the government has been that the NPPA may not have been able to identify drugs outside the NLEM for price control. 

According to the government data, pharmaceutical companies have margins up to Rs 1,450 per cancer tablet over the MRP. 

Besides Paul, the NITI Aayog committee has bureaucrats from various ministries, including finance, health, and commerce & industries. The NPPA and the Department of Pharmaceuticals (DoP) have not been included to avoid any conflict of interest in recommending these drugs, according to Paul. The committee will also include people from the civil society and pharma associations when needed. 

The government has also been mulling rationalising trade margins of many devices. The DoP is working on the devices which should be brought under control.  Coronary stents and orthopaedic knee implants have already been brought under price control.