Article begins:
The Union government has established a new body named the Standing Committee on Affordable Medicines and Health Products (SCAMHP) under the National Institution for Transforming India, referred to as NITI Aayog. This committee has been tasked with the job of suggesting medicines that should be subjected to price control. This move effectively reduces the dominance of the National Pharmaceuticals Pricing Authority (NPPA) in setting drug prices.
Roles and Responsibilities of SCAMHP
Initially a role held by the health ministry, SCAMHP is now the recommending body to the NPPA for the pricing of drugs and health products.
The health ministry would prepare a list of drugs eligible for price regulation. The Department of Pharmaceuticals (DoP) would then integrate this National List of Essential Medicines (NLEM) into Schedule 1 of the Drugs (Prices Control) Order (DPCO). The NPPA fixes the prices of drugs appearing in this schedule.
The newly formed committee can instigate an examination related to pricing either on its own or based on recommendations from the Department of Pharmaceuticals (DoP), NPPA or the department of health and family welfare.
The New Committee’s Powers
SCAMHP also holds the authority to enact powers under Para 19 of the Drugs (Prices Control) Order (DPCO). This regulatory power allows the committee to set a pricing cap for both scheduled and non-scheduled drugs if it deems it necessary for the public interest.
Back in 2013, the government had conferred these powers to the NPPA. It used these powers in 2017 to limit the prices of cardiac drugs, stents, and knee implants.
| Year | Action | Drug Category |
|---|---|---|
| 2013 | Powers conferred to NPPA | All |
| 2017 | Price cap introduced | Cardiac drugs, stents, knee implants |
Implications and Concerns
The establishment of this committee brings about certain implications, with the primary one being that SCAMHP has extensive discretionary powers. These powers might affect not only the pricing regime but also influence the roles and responsibilities of the NPPA.
Previously, NPPA was known for its strict actions against companies found guilty of overcharging for their health products. Critics worry this new committee will undermine the effectiveness of NPPA as a regulatory body. The change comes with concerns that the NPPA’s ability to enforce fair pricing may be compromised by SCAMHP’s broad discretionary powers.
