Category Archives: Essential Drugs

Draft Pharmaceutical Policy, 2017

The Department of Pharmaceuticals has circulated a Draft Pharmaceutical Policy, 2017 which can be accessed here.

The draft policy identifies the following key objectives:

a. Making essential drugs accessible at affordable prices to the common masses;

b. Providing a longer term stable policy environment for the pharmaceutical sector;

c. Making India sufficiently self-reliant in end to end indigenous drug manufacturing;

d. Ensuring world class quality of drugs for domestic consumption & exports;

e. Creating an environment for R&D to produce innovator drugs

It addresses a range of issues including indigenous production of API, quality control and regulatory approval, manufacturing arrangements, foreign direct investment, innovation and R&D and intellectual property. A major portion of the draft is devoted to pricing and makes various recommendations for the re-structuring of the NPPA and changes to the DPCO. 

A conference on the draft pharmaceutical policy is being organised by the Department of Pharmaceuticals on August 30 where various Ministries are expected to present relevant aspects of the policy to stakeholders for feedback. 

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Civil society letter on NPPA’s action on price control

Shri Ananth Kumar
Hon’ble Minister of Chemicals and Fertilizers
Udyog Bhavan
New Delhi 11001
 
20 August 2014
 
Dear Ananthji,

 

The National Pharmaceuticals Pricing Authority (NPPA), on July 10, 2014, released a new set of price notifications for 50 cardiovascular and diabetes medicines under paragraph 19 of the Drug Prices Control Order (DPCO), 2013. The notifications for the 108 formulations (two were subsequently withdrawn) of these selected medicines are in addition to the notifications for essential medicines declared under the DPCO 2013. We note that the earlier notifications for essential medicines excluded several dosage forms and strengths because they did not feature in the National List of Essential Medicines (NLEM), 2011. Thus the recent notifications were necessary to cover more of the strengths of medicines than that are listed on the NLEM. In addition, the notifications also covered medicines in the cardiovascular and diabetes therapeutic categories that are not included in the NLEM.

We the undersigned civil society organizations welcome the initiative of the NPPA to cap the prices of formulations involving essential and lifesaving medicines that fall outside the NLEM as a first step towards the institution of a robust, pro-public health policy of drug price control. This is an action that truly interprets the spirit of the Drug Prices Control Order, and its underlying legislation the Essential Commodities Act, 1955. In the past, despite its attention being drawn to the profiteering in medicines not listed in the DPCO, the government had looked the other way.

We are surprised at the misinformation being spread by the Pharmaceutical Industry in this regard, and its efforts to prevent relief to the consumer by filing petitions in the high courts in Mumbai and Delhi. Industry has challenged the legality of fixing the prices of the 50 medicines under Paragraph 19 of the DPCO 2013 when in fact the Government has in successive drug price control orders always retained the power to intervene in prices in the public interest in the light of evidence of overpricing.

Limiting all price regulation only to a list of 348 medicines and specified dosages and strengths in the DPCO 2013 goes against the policy objective of making medicines affordable to the public. The National List of Essential Medicines, a list of 348 rational and cost-effective medicines, is not the basis for production, promotion and prescription in India. In reality the most frequently prescribed and consumed medicines are not listed in the NLEM.

Industry has claimed that this will cause an annual loss of revenues of over Rs.600 crores. NPPA’s action on the market will however be marginal, and nowhere near the doomsday predictions of the industry. It will affect only those brands that were selling at very high prices. We have analysed the impact of the notifications and found that the retail market of Rs.77,526 crores (Moving Annual Total, June 2014) would experience a loss of  Rs. 350 crores (AIOCD-AWACS, PharmaTrac Data, 2014).  This represents a loss of approximately only 2% (Rs. 112 crore) in the anti-diabetic therapy segment and 2.5% (Rs. 238 crore) in the cardiac therapy segment. This in a way establishes the excess profits of the industry in those particular formulations by overcharging the patients.

Also the market based price fixation being followed by the NPPA, a departure from the long used cost-based price control mechanism, is irrational and means that the ceiling prices are still very high. Many medicines are sold by reputed companies much below the NPPA ceiling price. The ceiling price of atorvastatin 40mg is Rs. 22.02 per tablet while Biochem Pharmaceutical is selling the same at a much lower price of Rs. 14.94 per tablet. The ceiling price of glimepiride 3mg is Rs. 10 per tablet, while Ipca Laboratories is able to sell it for Rs. 6.90 per tablet. As per our calculations only a little over one fourth of packs selling on the market will need to revise their prices downwards because they were originally priced higher than the notified price. This is evidence that there is a scope for significant reduction in NPPA ceiling prices, without affecting the reasonable profits of the industry.

We also note that the notifications have not included fixed dose combinations in the cardiovascular and diabetes therapeutic categories whereas the sales of many combinations exceed those of the single molecule medicines.

We also raise the argument that fixing of ceiling prices of all the other dosage forms of all medicines under NLEM cannot be neglected. Here again the same phenomenon of overcharging remains. NPPA should come out with similar action to cover all dosage forms and fixed dose combinations containing one or more medicines under NELM, and as well as bring other essential and life saving medicines under price control immediately.

Although this notification of NPPA will give some relief to patients in the chronic disease sector in the present context, it should be expanded and rationalized. We request the Government and NPPA to strongly defend its stand and also consider the actions suggested by us to promote public health.

Signed,

All India Drug Action Network (AIDAN)
Jan Swasthya Abhiyan
Low Cost Standard Therapeutics (LOCOST)
Medico Friends Circle
Third World Network- India
All India Peoples Science Network (AIPSN)
National Working Group on Patent Laws

 
Copy to:
Hon’ble Shri Narendra Modi, Prime Minister of India
Hon’ble Shri Dr. Harsh Vardhan, Minister of Health and Family Welfare
Mr. Nripendra Misra, Principal Secretary, Prime Minister’s Office
Mr. Lov Verma, Secretary, Department of Health & Family Welfare, Ministry of Health & Family Welfare
Ms. Aradhana Johri, Secretary, Department of Pharmaceuticals, Ministry of Chemicals & Fertilizers
Mr. Injeti Srinivas, Chairman, National Pharmaceutical Pricing Authority, Department of Pharmaceuticals, Ministry of Chemicals & Fertilizers

 
 
 
For further information, contact:
 

LOCOST
1st Floor, Premanand Sahitya Bhavan
Dandia Bazaar
Vadodara, Gujarat – 390001
Ph: 9998771064
Email: chinusrinivasan.x@gmail.com

Jan Swasthya Abhiyan
National Secretariat
c/o Delhi Science Forum
D-158, Lower Ground Floor
Saket, New Delhi 110017
Ph: (011) 26524323, 26862716
Email: jsasect.delhi@gmail.com

 
 
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Generic Dava – Isse Behtar Kuchch Nahi…

DainikBhaskar

Supreme Court Order in the AIDAN Drug Pricing PIL – Oct 11, 2011

1
ITEM NO.101 COURT NO.7 SECTION PIL
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
WRIT PETITION (CIVIL) NO(s). 423 OF 2003
ALL INDIA DRUG ACTION NETWORK AND ORS. Petitioner(s)
VERSUS
UNION OF INDIA AND ORS. Respondent(s)

(With appln(s) for permission to submit additional
document(s),PERMISSION TO FILE ADDITIONAL AFFIDAVIT)
Date: 11/10/2011 This Petition was called on for hearing today.
CORAM :
HON’BLE MR. JUSTICE G.S. SINGHVI
HON’BLE MR. JUSTICE SUDHANSU JYOTI MUKHOPADHAYA
For Petitioner(s) Mr. Colin Gonsalves, Sr. Adv.
Mr. Anuj Castleino, Adv.
Ms.Jyoti Mendiratta,Adv.(Not present)
For Respondent(s) Mr. T.S.Doabia, Sr. Adv.
Mr. Ashok Bhan, Sr. Adv.
Ms. Rekha Pandey, Adv.
Ms. Sadhana Sandhu, Adv.
Mr. R.K.Rathore, Adv.
Ms. Asha G. Nair, Adv.
Mr. Shalinder Saini, Adv.
Mr. P. Parmeswaran ,Adv(Not present)
Mr. D.S. Mahra ,Adv(Not present)
UPON hearing counsel the Court made the following O R D E R

At the commencement of hearing Shri Colin Gonsalves,
learned senior counsel appearing for the petitioners read
out portions of 45th Report of the Parliamentary Standing
Committee on Health and Family Welfare and 7th Report of the
2
Standing Committee on Chemicals and Fertilizers.
Thereafter, Shri Doabia, learned senior counsel appearing
for the Union of India placed before the Court a photostat copy of the Office Memorandum dated 20.06.2011 sent by the
Ministry of Health & Family Welfare to the Secretary,
Department of Pharmaceuticals on the issue of revision of
National List of Essential Medicines. Paragraph 2 of that
memorandum reads thus:
“2. In the above connection, it may be
stated that the National List of Essential
List (NLEM), 2003 has been revised. The
revised list, the NLEM, 2011 contains 348
drugs. While approving the list, the
Minister of Health & Family Welfare has also
approved that if affordable healthcare has
to become a reality, all the medicines
included in the NLEM, 2011 should be brought
within the ambit of price control under the
DPCO, considering the fact that the cost of
medicines in the overall cost of healthcare
constitutes more than 60% and a large
percentage of our people do not have access
to affordable healthcare. If, at all, such
medicines cannot be included under DPCO with
the same trade margins, there could be
graded system of trade/profit margins for
different categories and 348 medicines in
NLEM, 2011 could be so categorized. This
will ensure that reasonable margins and
growth of Pharma industry also do not get
adversely affected. The Minister has,
therefore, approved taking up the matter
with the Department of Pharmaceuticals for
further appropriate action.”
Shri Ashok Bhan, learned senior counsel appearing
for the Department of Chemicals and Fertilizers also placed
before the Court a xerox copy of Office Memorandum dated
04/05.10.2011. In para 6 thereof, it is mentioned that the
3
Department of Pharmaceuticals is examining all the
possibilities of control and monitoring of prices of
medicines including those covered under the NLEM, 2011.
Having perused the two Office Memorandums placed by
the learned senior counsel for Union of India and Department
of Chemicals and Fertilizers, we deem it proper to direct
the Secretaries of two Ministries to file their affidavits within four weeks indicating therein as to within what time
the revised list of National List of Essential Medicines
(NLEM) will be added in Schedule-I of the Drugs (Price
Control) order, 1995.
A comprehensive revised list of National List of
Essential Medicines (NLEM) be also produced along with
affidavit to be filed on behalf of the Ministry of Family &
Welfare.
List the case on 17.11.2011 for further hearing.
(Parveen Kr. Chawla) (Phoolan Wati Arora)
Court Master                Court Master

Draft National Pharmaceuticals Pricing Policy (NPPP-2011) & response

The Draft National Pharmaceuticals Pricing Policy (NPPP-2011) has been released. View it here.

A brief comment on the NPPP-2011 was written by AIDAN member Srinivasan S. and published in The Hindu Business Line, November 8, 2011

Pharma industry gets away lightly

The draft National Pharmaceuticals Pricing Policy (NPPP-2011) declares that all 348 essential medicines (as per the new National List of Essential Medicines, NLEM 2011) will be under price regulation. The shift in focus from market share to whether medicines are essential is to be welcomed. However, the policy still leaves scope for non-essential and irrational medicines to be made. It also has made calculating ceiling prices of the many medicines not in NLEM a tedious, if not impossible, exercise.

In addition to the NLEM 2011, top selling 300 medicines of the IMS could have been covered. The draft policy delinks the ceiling prices of formulations from the price of bulk medicines. Indeed, the arguments given in the draft policy for removing price control of bulk medicines do not make sense. The government should have kept the option of price control on bulk medicines in the event of cartelisation or abnormal increases in price of bulk medicines.

The latter may result in the scarcity of a particular essential medicine formulation unless it is already overpriced relative to the cost of the bulk medicine used. Worse, this may result in the bulk medicine or the formulation not being made within the country.

Secondly, using the WPI (Wholesale Price Index) to revise prices is not a good idea. It adds an inflationary element to the ceiling price automatically every year. The WPI (100 for base year 2004-05) for 2010-11 is 143.3. Most medicine prices have not really increased 43 per cent during the period. It would have made sense to have the ceiling price of a medicine formulation tied directly to the related bulk medicine price increase during the year.

RELIANCE ON MARKET

The arguments for totally relying on market-based pricing (MBP) of formulations apparently do not recognise the fact that there exists a wide range of prices in the market of the same formulation and that prescribers, and therefore patients, tend to place more value on the costlier brands of the same formulation. In medicines, unlike say soaps or cars, the brand leader is also the price leader. The proposals of market-based pricing, therefore, legitimise higher prices. The key para in the draft policy is para 4.7: “The Ceiling Price would be fixed on the basis of Weighted Average Price (WAP) of the top three brands by value (MAT value) of a single ingredient formulation medicine from the NLEM on per standard dosage basis.”

The WAP idea means that it will end up legitimising high prices, especially if the top three brands are overpriced: top selling brands — with a few exceptions — would be the costliest.

That is the norm of the medicines sector, thanks to asymmetry between consumer and prescriber/manufacturer. It means that that regardless of overpricing and profiteering, if the market “accepts” it, the price is ok. Never mind if the patient may get poorer in the process. It also legitimises the mistaken notion that higher priced medicines are of better quality. In our case, for example, albendazole selling above Rs 12-13 per tablet (price of current market leaders) would seem fine.

A comparision of medicine prices

A comparision of medicine prices

Ceiling prices need to have a clear relationship with the cost of the raw material at least. The WAP formula has, in effect, no relation with the cost of raw material, let alone the cost of other inputs. The MRP to raw material ratio is about 3000-5000 per cent in quite a few essential medicines. Should a government legitimise such super profits? Most retail pharmacies do not keep cheaper versions because of lesser margins; eventually all lower-priced brands will move towards the higher ceiling price even as ‘premium’ prices, including that of overpriced imported medicines such as Novartis’ Glivec, will take a hit with the WAP formula.

MEDICINES OUTSIDE NLEM

The draft policy gives a formula to discourage non-standard dosages. The same thinking could have been applied to discourage irrational and unscientific medicines outside the NLEM. One can discourage irrational combinations, and attempts to circumvent the ceiling price, by taking the cue from the Pronab Sen Task force Report — from which many of the recommendations have been taken anyway — which says, “For formulations containing a combination of a medicine in the NLEM and any other medicine, the ceiling price applicable to the essential medicine would be made applicable.” Sales tax and excise duty could be higher for medicines outside NLEM 2011 and zero for NLEM medicines. The draft policy could also take another recommendation from the Pronab Sen Committee: debrand, that is remove brand names, to ensure true competition among generics.

The draft policy lists certain exemptions which, again, are inexplicable: all medicines costing less than Rs 3 per unit are to be exempt. This again legitimises overpricing of medicines which cost 10-20 paise, and begs them to be priced near Rs 3. An example is cetrizine, which costs less than 15 paise per tablet to make, but the brand leaders are available near Rs 3. Why should this be condoned? Should much-needed iron plus folic acid tablets, which cost less than 10 paise per tablet to produce, be given leeway to sell at or near Rs 3? Most retailers will give only a strip of 10, even when one needs a couple of tablets only.

THE ALTERNATIVE

So, what is a better pricing policy? That will be one that brings down the prices of overpriced medicines; that has some linkage to the actual cost of production, and therefore to the cost of the raw material; and does not legitimise overpricing of medicines. Nominally reducing the price of the top-selling brand is tokenism.

A good starting point would be to take as reference price the prices of well-run public procurement systems and take a multiple, say 4 to 6, of the reference price as the ceiling price. The present WAP procedure will make the ceiling price 20 to 70 times the public procurement price — which is a little rich.

The draft policy gives the impression of a policy cobbled to satisfy perfunctorily the Supreme Court Orders of March 2003 and October 2011, one that will leave major players mostly unaffected. A policy with some bark and a little bite.

(The author is associated with the All-India Drug Action Network and LOCOST, Vadodara. blfeedback@thehindu.co.in)

(This article was published on November 8, 2011)

Ensuring affordability, accessibility and safety of medicines through urgent action

Health Action

Health Action

Health Action (HA) has published articles relating to essential medicines, generic medicines, drug price control and other drug related issues in its September 2009 issue. Some of the relevant articles have been uploaded here (with permission from HA).

Dubious Rather Than Spurious Drugs – India’s Real Drug Problem
Dr Anurag Bhargava M D

Access to medicines implies access to medicines of proven efficacy, safety and acceptable quality, prescribed in a rational manner. Governments have a responsibility of ensuring availability and affordability of such medicines. Yet the situation in India with all these issues related to medicines is marked by paradoxes. In spite of having one of the largest pharmaceutical industries supplying low-cost essential medicines globally, India has the largest number of people in the world without access to essential medicines, …………

People’s Initiative for Generic Medicines
Dr. Anant Phadke

In India, medicines are unnecessarily exorbitantly costly. Prices of medicines can be brought down to one half, even to one-fourth immediately, if the government takes appropriate measures to stop reckless profiteering and waste that are prevalent in the manufacture and sale of medicines. Since the early eighties, the All India Drug Action Network (AIDAN) has been advocating these measures, but in vain. While it may take many more years to change the govt…….

Essential Medicines: Economic constraints in access in India
Dr. Purnabrata Gun & Sushanta Roy

Essential medicines are among the most costeffective elements in modern health care and their potential health impact is remarkable. This year alone, there will be over 40 million deaths in developing countries, one-third among children under age five. Ten million deaths will be due to acute respiratory infections, diarrheal diseases, tuberculosis, and malaria. Safe, inexpensive, essential drugs can be life-saving in all these disease conditions……..

Good to be True, but True! Retail Sale of Generic Drugs at Low Prices by the Government in Chittorgarh Dt
S.Srinivasan

We all know that one of the solutions for making medicines affordable to people is to make available only essential generic drugs at lower prices, that is if your doctor prescribes them in the first instance. Procurement prices of generic drugs by Governments like that of Tamil Nadu and Delhi have revealed that prices of generics are 1.5 % to 10 % of the maximum retail price (MRP) of branded equivalents at the retail level. However, to get a retail pharmacist to stock these low-priced generics is easier said than done…..

Drug Price-Control: Problems, Principles and Prospects
Dr Chandra M Gulhati

One way or the other, prices of many sensitive goods and services are subject to some sort of price regulation either through state’s intervention or other mechanisms including competition, negotiated prices by bulk buyers, reimbursement by insurance companies just to mention a few…………

To download the entire issue of Health Action, September 2009 issue, click here

MAKING MEDICINES AFFORDABLE – Reaching the Unreached

MAKING MEDICINES AFFORDABLE - Reaching the Unreached

MAKING MEDICINES AFFORDABLE - Reaching the Unreached

LOW COST MEDICINES INITIATIVE – CHITTORGARH
DISTRICT LEVEL INTERVENTIONS – THE MODEL

“We knew that the actual cost of most of the drugs is very low. But, these were not available to patients at low rates because of three obstacles:…………….. So, the district administration adopted the following strategy to provide low cost medicines to the patients.”

These are some excerpts from the booklet “MAKING MEDICINES AFFORDABLE – Reaching the Unreached” – documented by Dr. Samit Sharma, Collector and District Magistrate, Chittorgarh. To know about the strategy or to download or read the booklet, click here

To know more about the low cost medicines initiative in Chittorgarh, click here

To see the comparisons between printed M.R.P. of medicines and prices at CHITTORGARH SAHAKARI UPBHOKTA THOK BHANDAR LTD., CHITTORGARH, click here