Drug majors Eli Lilly, Novo Nordisk, Torrent Pharma and Lupin may not be allowed to hike insulin rates as they have not been able to convince the National Pharmaceutical Pricing Authority (NPPA) on why they cannot conform to the current ceiling price.
The drug pricing regulator, acting on the directions from the department of pharma (DoP), is currently holding discussions with the drugmakers to understand the total cost of manufacturing and marketing the diabetes-controlling drug.
?We have asked them (pharma companies) to explain the entire process including cost structures and components which leads to the maximum retail price they want to charge. However, till now they haven?t been able to categorically state how the ceiling price (set by NPPA) does not meet their cost price,? said an official.
In November last year, NPPA issued a ceiling price on all brands of imported insulin in the range of R160-200 a packet, depending on the quantity, while retail cost of India-made insulin was pegged at R135-145 a packet.
While insulin has always been under price control, pharma companies earlier had separate prices fixed by the drug regulator for individual brands. While multinational insulin brands were priced between R170-480, domestic brands were being sold at around R145 a packet.
NPPA had set the November ceiling price on insulin by lowering the post manufacturing margin of pharma companies in an attempt to make the product more affordable to consumers.
However, the move did not go well with pharma majors who challenged the NPPA order with the DoP. The pharma ministry, thereafter, asked NPPA to review its pricing decision and reconsider all relevant information and applicable norms while fixing prices.
In the interim period, all companies have been asked to maintain the ceiling price.
The pharma department is of the opinion that the domestic industry is unable to cater to the rising demand for insulin and, therefore, import is essential. NPPA has time till May-end to come up with a revised ceiling price.