Recently, the National Pharmaceutical Pricing Authority (NPPA), India’s drug pricing regulator, has sanctioned an increase of up to 50% in the maximum retail prices of 21 drugs currently under price control. This uncommon decision was made by invoking paragraph 19 of the Drug Prices Control Order (DPCO), 2013, which has historically been used only to decrease prices of medical devices like stents and knee implants. Notably, most of these impacted drugs are commonly used as first-line treatments and hold sizable importance in the country’s public health program.
Affected Drugs and their Importance
The decision applies to formulations like the BCG vaccine for tuberculosis, vitamin C, antibiotics like metronidazole and benzylpenicillin, antimalarial drug chloroquine, and leprosy medication dapsone. These are all vital medicines playing a critical role in disease management and public health.
Essential Aspects of Drug Prices Control Order, 2013
Under DPCO 2013 provisions, prices of only those drugs that figure in the National List of Essential Medicines (NLEM) are supervised and controlled by the NPPA. Essential medicines are defined as those which meet the priority healthcare needs of the majority of the population. The primary aim of NLEM is to encourage rational use of medicines, taking into account three significant aspects: cost, safety, and efficacy. However, there is no precedent or formula prescribed for upward revision of ceiling prices.
Background of the Decision
Manufacturers have reported difficulties supplying these drugs, with some companies even applying for discontinuation of the product citing unviability. The NPPA has been receiving applications for price increases under paragraph 19 of DPCO, 2013, over the last two years. Reasons given include increased costs in Active Pharmaceutical Ingredient (API), production costs, exchange rates, etc., leading to unviability in sustainable production and marketing of the drugs. India is reliant on China for over 60% of its API needs, which means higher API costs for price-controlled medicines can reduce profits and make production of these drugs unviable in India.
Table: Increase in Ingredient Cost
| Drug | Percentage Increase in Cost of Ingredients |
|---|---|
| Vitamin C | 250% |
Key Points: Availability and Future Outlook
The decision was implemented with ensuring uninterrupted availability of life-saving essential drugs to the public as its prime objective. The NPPA aims to avoid situations where these drugs disappear from the market causing the public to switch to expensive alternatives.>This unprecedented move by the NPPA — better known for reducing prices of essential and life-saving medicines — signifies an increase in prices intended for the public interest. In the long term, India requires to enhance its capabilities to manufacture key ingredients for these medicines.
