Lok Sabha Question No. 2509 (UNSTARRED), answered on 2018-01-02
Subject: Production Cost of Medicines
Ministry: CHEMICALS AND FERTILIZERS
Asked by: SHARAD TRIPATHI

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS AND FERTILIZERS DEPARTMENT OF PHARMACEUTICALS

LOK SABHA UNSTARRED QUESTION No. 2509 TO BE ANSWERED ON THE 2 nd  January, 2018

## Production Cost of Medicines

## †2509. SHRI SHARAD TRIPATHI:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether the production cost of uncontrolled medicines is several times more than the controlled medicines;
- (b) if so, the reasons therefor;
- (c) the steps taken by the Government in this regard; and
- (d) whether the Government has any policy to reduce the prices of the cancer, AIDS and life-saving drugs and if so, the details thereof?

## ANSWER

## MINISTER  OF  STATE  IN  THE  MINISTRY  OF  ROAD  TRANSPORT  AND HIGHWAYS;  MINISTRY  OF  SHIPPING  AND  MINISTRY  OF  CHEMICALS  AND FERTILIZERS (SHRI MANSUKH L. MANDAVIYA)

- (a),  (b)  &  (c):  The  Drugs  (Prices  Control)  Order,  2013  (DPCO,  2013)  follows  the market based policy for fixing the prices wherein the production cost is not taken into consideration. The Government does not maintain data about the production cost of controlled/uncontrolled medicines.
- (d): The Government fixes the ceiling price of formulations specified in the Schedule I of the DPCO, 2013 including various medicines under Anti-Cancer (72 formulations),  Cardio  Vascular  (65  formulations),  Anti-TB  (Lung)(28  formulations) and  Anti-Viral  (HIV)  (41  formulations)  in  Schedule-1  for  price  control.  Further,  the DPCO, 2013 has provisions under which the Government can fix the ceiling price of any drug in public interest. Recently, the government has used this power for fixing the  ceiling  price  of  Coronary  Stents,  Knee  Implants  and  Cardio  and  Anti  Diabetic drugs.  Further,  the  Government  had  issued  a  compulsory  license  for  a  drug 'NEXAVAR'  used  for  the  treatment  of  cancer.  The  patent  is  held  by  M/s  Bayer Corporation.  After  the  issue  of  the  compulsory  license,  the  Indian  company  M/s Natco Pharma Ltd. has been able to sell the medicine at a much lower price.

Till  December  2017,  the  government  has  fixed  the  ceiling  prices  of  851 medicines under revised Schedule-1 based on National List of Essential Medicines, 2015 (NLEM, 2015) which also includes drugs used for cancer, AIDS and other lifesaving drugs. The Government by implementing the provisions of DPCO, 2013 has helped the consumers make the following savings:-

| Particulars                              | Saving to Consumers in Rs. Crores   |
|------------------------------------------|-------------------------------------|
| NLEM 2011                                | 2,422.24                            |
| NLEM 2015                                | 2,643.37                            |
| NLEM 2015 - Coronary Stents              | 4,450.00                            |
| Para 19 - Knee Implants                  | 1,500.00                            |
| Para 19 - Cardio and Anti Diabetic drugs | 350.00                              |
| Grand Total                              | 11,365.61                           |