Government to cap prices of essential drugs

The group of ministers, led by Agriculture minister Sharad Pawar,  yesterday finalised the pharma pricing policy under which 348 essential drugs would come under price control of the government, with an average price reduction of 11 per cent. The group has committed to reducing prices of essential drugs including anti-diabetics, pain-killers, anti-infectives and anti-cancer drugs.

The committe had proposed a cap on prices of the essential medicines at the weighted average price of drugs with a 1 per cent market share. On their being brought under drug price control order, the drugs cannot be sold at a price higher than the one fixed by the government. MNCs would be expected to be hit hard on acceptance of the recommendations as the prices of imported drugs under price control had been capped based on their landed cost.

The group of ministers (GoM) would send their recommendations to the cabinet within a week for approval for inclusion in the National List of Essential Medicines (NLEM), with total sales of around Rs29,000 crore, which was around 60 per cent of the domestic market, under control.

''We have finalised every thing . Now it will go to the Cabinet and the Cabinet will take the final view. We will send it in a week's time,'' Pawar told reporters after the meeting.

Currently, the government through the National Pharmaceutical Pricing Authority (NPPA), controls prices of 74 bulk drugs and their formulations.

According to fertilisers and chemicals minister Srikant Jena, the GoM arrived at a consensus on the option that entailed the use of weighted average prices for all the drugs having a market-share of over 1 per cent. He added there were three-four options present for the consideration of the GoM, but he thought broad agreement had been made on the option of 1 per cent market share.