India to overhaul drug price control system
New Delhi: The government is planning to overhaul the existing system of fixing drug prices in the country.
The matter will be discussed at a meeting on 10 April at the Prime Minister’s Office (PMO) with experts from central government think tank NITI Aayog, the department of pharmaceuticals, the National Pharmaceuticals Pricing Authority (NPPA) and the health ministry, two people aware of the matter said, requesting anonymity.
NITI Aayog had earlier sought the views of experts on whether the National List of Essential Medicines (NLEM) should be linked to the Drug Price Control Order (DPCO), which drugs are to come under price control and how price caps should be determined.
Currently, the health ministry prepares the list of drugs eligible for price regulation. Then, the department of pharmaceuticals, which comes under the ministry of chemicals and fertilizers, incorporates them into Schedule 1 of DPCO. Following this, the NPPA fixes the prices of drugs in this schedule.
Medicines and devices listed in NLEM must be sold at the price fixed by NPPA, while those in the non-scheduled list are allowed a maximum annual price hike of 10%.
The matter regarding NLEM and amendments to DPCO has been under discussion at NITI Aayog, which had met pharma lobby groups early in January at the behest of the PMO after the latter had expressed dissatisfaction over the way NPPA set price caps. Pharma experts were asked to propose changes in the manner the government identifies medicines that should be brought under price control and what they feel is the best approach to have timely additions and deletions in NLEM.
NLEM lists drugs that are considered essential and should be brought under price caps by NPPA. The last update was in 2015. “The NLEM list has to be updated this year for which an expert body will be reconstituted. After the 10 April meeting, we will be in a position to finalize a new methodology for fixing drug prices,” said one of the two people cited earlier.