Price cap on 108 “non-essential” drugs lifted as govt reverses stance

The National Pharmaceutical Pricing Authority (NPPA) has withdrawn its disputed order on the price control of 108 non-scheduled formulations after the government withdrew the regulator's power to cap prices of non-essential drugs.

In an announcement published on its web site on Monday, NPPA said it is withdrawing ''with immediate effect'' a 29 May guideline that had allowed it to put price limits on certain drugs for cancer, HIV, cardiovascular disease and diabetes when needed.

The Department of Pharmaceuticals decided to withdraw the drug pricing authority's powers to fix the prices of medicines not deemed essential, after its decision to impose price caps on more than 100 drugs in July triggered industry protests.

The NPPA order to cap prices of 108 drugs used in the treatment of HIV / AIDS, cardiovascular diseases and diabetes, which were not part of National List of Essential Medicines (NLEM), had attracted wider criticism from the industry and had led to lawsuits against the order.

The Department of Pharmaceuticals has withdrawn guidelines issued on 29 May empowering the National Pharmaceutical Pricing Authority (NPPA) to fix the prices of drugs that are deemed essential, but not on the official list of essential medicines.

The NPPA is under the direct control of the Department of Pharmaceuticals, in the ministry of chemicals and fertilizers.

While the NPPA notice in July imposing price caps on 108 non-essential drugs had come as a big relief to patients waiting for treatment of diseases ranging from diabetes to HIV/AIDS, the lifting of price curbs now comes as a blessing to drugmakers whose profits were dented by the price curbs.

Drug firms are now expected to jack up prices of a range of drugs used in the treatment of diseases from diabetes and cardio-vascular diseases to HIV/AIDS.

While the drug price regulator's move to withdraw the pricing guidelines look puzzling, the timing seems to be intended to send the right signals on the eve of Prime Minister Narendra Modi's trip to the United States where the pharma lobby is arraigned against India's drug pricing and patent policies.

While the government had revised the Drug Price Control Order after discussions with all stakeholders, industry complaints that the constant changes in the government's targets make it difficult for them to plan for the local market.

Perhaps the government is trying to smooth ruffled feathers by limiting the number of contentious issues as it prepares for the PM's visit to the US.