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NPPA caps prices of 9 non-scheduled drugs

Topics Covered:

 

  1. Statutory, regulatory and various quasi-judicial bodies.
  2. Issues related to health.
  3. Protection of the vulnerable sections of the society.

 

NPPA caps prices of 9 non-scheduled drugs

 

What to study?

For Prelims: About NPPA, DPCO and scheduled drugs.

For Mains: Issues involved and the need for drug price monitoring, relevance of DPCO.

 

Context: NPPA has capped the prices of 9 non-scheduled cancer drugs by up to 87%, capping their trade margin at 30%. The new list of drugs is in continuation to the government’s efforts to curb profiteering on these vital drugs.

 

Background:

The NPPA currently fixes price of drugs on the National List of Essential Medicines under schedule-I of DPCO. So far, around 1,000 drugs have been price-capped through this mode.

The trade margin rationalisation has been rolled out as proof of concept, stressing on the new paradigm of self-regulation by the industry.

 

What is the “Drugs (Prices Control) Order (DPCO)” ?

The Drugs Prices Control Order, 1995 is an order issued by the Government of India under Sec. 3 of Essential Commodities Act, 1955 to regulate the prices of drugs.

The Order interalia provides the list of price controlled drugs, procedures for fixation of prices of drugs, method of implementation of prices fixed by Govt., penalties for contravention of provisions etc.

For the purpose of implementing provisions of DPCO, powers of Govt. have been vested in NPPA. Later, the Drugs (Prices Control) Order (DPCO) 2013 was notified.

 

Why the DPCO is issued under Essential Commodities (EC) Act ?

Drugs are essential for health of the society. Drugs have been declared as Essential and accordingly put under the Essential Commodities Act.

 

Are all the drugs marketed in the country under price control ?

No. The National List of Essential Medicines (NLEM) 2011 is adopted as the primary basis for determining essentiality, which constitutes the list of scheduled medicines for the purpose of price control. The DPCO 2013 contains 680 scheduled drug formulations spread across 27 therapeutic groups. However, the prices of other drugs can be regulated, if warranted in public interest.

 

What is NPPA and its role ?

  • National Pharmaceutical Pricing Authority (NPPA), was established on 29th August 1997 as an independent body of experts as per the decision taken by the Cabinet committee in September 1994 while reviewing Drug Policy.
  • The Authority, interalia, has been entrusted with the task of fixation/revision of prices of pharmaceutical products (bulk drugs and formulations), enforcement of provisions of the Drugs (Prices Control) Order and monitoring of the prices of controlled and decontrolled drugs in the country.

 

Why are the prices of medicines rising ?

The reasons for rise in the prices of medicines are :

  • rise in the price of bulk drugs;
  • rise in the cost of excipients used in the production of medicines like Lactose, Starch, sugar, glycerine, solvent, gelatine capsules etc.;
  • rise in the cost of transport, freight rates;
  • rise in the cost of utilities like fuel, power, diesel, etc.;
  • for imported medicines, rise in the c.i.f. price and depreciation of the Rupee;
  • changes in taxes and duties.

 

Sources: The Hindu.

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