Top-selling drugs not the most expensive ones: Pharma cos

Written by Soma Das | New Delhi | Updated: Feb 22 2012, 09:23am hrs
The domestic pharma industry has contested claims from certain quarters that using the prices of the three top-selling drug brands as a benchmark to fix the ceiling prices of drugs listed under price control may actually lead to general soaring in drug prices of the concerned therapies.

The representatives of the pharma industry at a meeting last week with DS Kalha, the new secretary of department of pharmaceutical, claimed that the popular notion that top-selling brands are usually the most expensive ones is over-simplified, over-generalised and simply not accurate.

Substantiating their claims with the 2010 data of pharma market research agency IMS, the industry representatives claim that in case of the 10 of the leading therapeutic categories in the domestic market, which constitute 87% of the market, each category is being served by over 25 players.

For instance, 582 players offer cough preparation, over 135 players retail antibiotic Cefixime oral solid drugs, anti-inflammation drug Diclofenac combination oral solid drug, iron supplement in liquid form, while cholestrol drug Atorvastatin, ulcer drug combination of Rabeprazole and Domeperidone and anti-anxiety drug Alprazolam have over 75 formulations each, according to the data furnished by the industry.

The industry has repudiated the notion that top-selling brands are invariably the most expensive brands in the market. More importantly, the set of data submitted by industry association Indian Pharma Alliance to both department of pharma and health ministry asserts that barring one category, the top selling three brands in the chosen 10 therapeutic categories are not the priciest brands being retailed.

These counterclaims of the industry come in the backdrop of fear expressed by the health ministry, WHO and a few public health organisations in the developmental sectors regarding determination of drug price caps by taking into account the three best-selling drugs in any category. They claim such price fixing can encourage those players who are selling at much lower prices to increase prices, considering best selling drugs are usually the more expensive ones.

In a letter addressed to ministry of health, IPA that the proposed policy would prompt reduction of prices of these 10 formulations in the range of 4% to 89%.The drug brand which has to undertake maximum price reduction in the anti-infective category if the proposed pricing policy is implemented would have to cut prices by 76% from its existing pricepoint. Comparable figure for other therapeutic categories stand at cardiac (4%), gastro intestinal (58%), respiratory (33%), pain/analgesics (89%), vitamins, minerals and nutrients (34%), anti-diabetic (11%), gynaec (81%), and central nervous system (88%).

Our analysis shows that 87 companies out of 136 formulators in these concerned therapies would need to slash prices of their products. And that is only because the remaining companies are already selling at a rate below what the proposed policy would require them to. That is because of the intense competition prevailing in these categories, said DG Shah, secretary general, IPA.