Price cap on Knee implants extended by 1 year

The National Pharmaceutical Pricing Authority (NPPA) recently extended the price cap on Knee implants by one year till September 2021. The price regulator has made the extension after the order validity ended in August 2020.

Highlights

The regulator capped the prices of knee implants by 70% in 2017 under the Drug Price Control Order, 2013.  In 2017, the prices where capped at Rs 54720. However, in 2019, the NPPA allowed firms to take 10% hike for the year in their implant products.

What is DPCO?

Under the provisions of DPCO 2013, only the prices of drugs that are included under National List of Essential Medicines can be controlled by NPPA.  Essential medicines are those medicines that satisfy the needs of majority of the population. The NLEM promotes the use of these essential medicines under three important aspects namely cost, safety, and efficacy.

Background

In August 2018, under the recommendation of Niti Aayog 23 medical devices were notified as drugs and regulated under Drugs and Cosmetics Act.  Of these, four were included under NLEM.  They were cardiac stents, condoms, drug eluting stents and intra uterine devices.

The knee caps were not brought under NLEM.  However, their prices were capped by 65% in 2017.  The DPCO authorizes the central government to fix the price of medical devices under extraordinary circumstances or when the government considers necessary to do so in Public Interest.

Legislation

The price cap of the knee implants was done based on para 19 of DPCO, 2013. Para 19 of the order empowers NPPA to control the prices of drugs that are not listed under NLEM.  The Orthopaedic devices (like that of knee implants) are not included in NLEM.

The NLEM list is prepared by union Ministry of Health and Family Welfare. It was last updated in 2015.

National Pharmaceuticals pricing authority

it is an organisation operating under Ministry of chemicals and fertilizers. It was established in 1997. The authority is empowered to control the prices of bulk drugs, drug formulations and to enforce availability of medicines in the country under drugs price control order.