Pharmaceutical companies have given a host of suggestions to the government, for the proposed revision of drug pricing policy.
“We have suggested that the new policy should focus on both affordability and innovation which is a shift from the current Drug Prices Control Order (DPCO) 2013 which is largely centered on affordability. The discussions concluded a few weeks ago, and we are expecting the new policy to come out this year,” said Viranchi Shah, national president of Indian Drug Manufacturers’ Association (IDMA).
Shah said that pharma bodies have recommended that the companies must be incentivised if the government wants to bring down the dependence on Chinese API (active pharmaceutical ingredients) imports. “We can boost API production in the country by giving concessions to the companies who are using domestically-produced APIs,” he said.
The department of pharmaceuticals (DoP) has just concluded the discussions on the proposed revision of DPCO with all stakeholders.
An official from another industry association said on condition of anonymity that the prices of Chinese APIs are typically lower which is deterring the Indian API manufacturers to grow in size. “If the domestic companies start using slightly expensive APIs, then the price caps on those formulations must be relaxed. If the government is serious, then it has to start somewhere and build an ecosystem,” he said. In FY24, almost 72% of the bulk drug imports came from China.
Another suggestion from the industry is to relax the norms for price revisions. At the moment, the companies are required to recall their entire stock with the 0.9-million-odd pharmacies if there’s a change in MRP (maximum retail price). “We have asked the government to introduce prospective pricing system whereby there’s no need for recalls. It’s a nightmare for the companies to recall the stock,” said Shah.
The pharma bodies have also asked for the simplification of price approval procedures, especially for therapies which are a combination of scheduled and non-scheduled drugs. The industry said that if a drugmaker has taken approval for a specific combination, then other entities who are launching similar combination within six months must be exempt from taking NPPA’s (National Pharmaceutical Pricing Authority) approval. “It takes 70-80 days for the approvals to come which is a waste of time for the companies and the authority,” said the second pharma body head quoted above.
In March, DoP formed a committee to review the price framework for drugs and medical devices. Initially, the committee had five members (including two special invitees) but the members’ list was expanded later to include more members for wider participation.
The other key changes proposed by the industry include the ease of doing business measures such as one-time settlement for ongoing litigations, and incentivising companies focussing on India-specific treatments and novel drug delivery systems. For instance, anemia is still a major health concern in rural India despite a host of government-supported projects against the disease.
“We have asked for incentivising companies who are doing research in new therapies and new drug delivery systems,” Shah said.
