Govt caps trade margin at 70% of distributor level prices on five medical devices

The government has decided to regulate their prices for affordable healthcare and pandemic  management by invoking extraordinary powers under the Drug Prices Control Order (DPCO), 2013 in the larger public interest. 

Earlier, in February 2019 NPPA had capped the trade margin on anti-cancer drugs and on 3 June 2021 on oxygen concentrators. Based on the notified trade margin, NPPA has instructed manufacturers / importers to report revised MRP within seven days. Revised MRPs will be informed in public domain thereafter by NPPA. The revised prices will come into effect from 20 July 2021.

Every retailer, dealer, hospital and institution should display price lists of these medical devices as furnished by the manufacturer, on a conspicuous part of the business premises in a manner so as to be easily accessible to any person wishing to consult the same. The manufacturers / importers not complying with the revised MRP after capping of the trade margin, will be liable to deposit the overcharged amount along with interest at the rate of 15 per cent and pay a penalty of up to 100 per cent under the provisions of the Drugs (Prices Control) Order, 2013 read with Essential Commodities Act, 1955. 

State Drug Controllers (SDCs) will monitor the compliance of the order to ensure that no manufacturer, distributer, retailer sells these medical devices to any consumer at a price exceeding the revised MRP, to prevent instances of black-marketing.

The order will be applicable till 31 January 2022, subject to review, an official release stated.