Lok Sabha Question No. 450 (UNSTARRED), answered on 2020-02-04
Subject: Price Control by NPPA
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Aparajita Sarangi

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

LOK SABHA UNSTARRED QUESTION NO. 450 TO BE ANSWERED ON 4 th  February, 2020

## Price Control by NPPA

## 450. SHRIMATI APARAJITA SARANGI:

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

- (a) the criteria adopted by the National Pharmaceutical Pricing Authority (NPPA) for placing of drugs under price control regime;
- (b) the details of life saving drugs placed under price control and the prices of such drugs compared to the market prices; and
- (c)  the  details  of  the  support  being  provided  by  the  Government  for  research  and development of life saving drugs in the country?

## ANSWER

## MINISTER IN THE MINISTRY OF CHEMICALS AND FERTILIZERS (SHRI D. V. SADANANDA GOWDA)

(a): The Pharmaceutical Policy announced by the Government from time to time envisages making available quality medicines at reasonable prices to the masses. National  Pharmaceuticals  Pricing  Policy,  2012  (NPPP-2012)  was  notified  with  the objective to put in place a regulatory framework for pricing of drugs so as to ensure availability of required medicines - 'essential medicines' at reasonable prices even while  providing  sufficient  opportunity  for  innovation  and  competition  to  support  the growth  of  pharma  industry  thereby  meeting  the  goals  of  employment  and  shared economic well-being for all.

Pursuant  to  the  announcement  of  National  Pharmaceuticals  Pricing  Policy, 2012,  Government  notified  Drugs  (Prices  Control)  Order,  2013  (DPCO,  2013)  on 15th  May,  2013.  All  the  medicines  specified  in  the  National  List  of  Essential Medicines, 2011 (NLEM) were included in the First Schedule of DPCO, 2013 and brought under price control.

Under  DPCO,  2013,  prices  of  drugs  are  fixed  on  'Market  based  pricing' methodology. 'Market based pricing' methodology has been adopted in accordance with the principles outlined in the NPPP, 2012. NLEM 2015 contains 949 scheduled drug formulations spread across 31 therapeutic groups.

(b): Life  saving  drugs  is  not  defined  in  DPCO,  2013.  However,  all  medicines specified  in  the  National  List  of  Essential  Medicines  2011  (NLEM)  have  been included in the First Schedule of Drugs (Prices Control) Order, 2013 for the purpose of price regulation. NPPA fixed the ceiling prices of 530 scheduled formulations on market based pricing methodology. The details of reduction in prices of scheduled formulations effected under DPCO, 2013 as compared to the highest price prevailed prior to the price fixation is as below :

| % reduction with respect to Maximum Price   |   No. of drugs |
|---------------------------------------------|----------------|
| 0<= 5%                                      |             80 |
| 5<=10%                                      |             50 |
| 10<=15%                                     |             57 |
| 15<=20%                                     |             43 |
| 20<=25%                                     |             65 |
| 25<=30%                                     |             49 |
| 30<=35%                                     |             26 |
| 35<=40%                                     |             34 |
| Above 40%                                   |            126 |
|                                             |            530 |

Further, Schedule I of DPCO, 2013 was amended by adopting NLEM, 2015. Accordingly,  NPPA  has  fixed  the  ceiling  prices  of  860  scheduled  formulations  on market based pricing methodology. The details of reduction in prices of scheduled formulations effected under DPCO, 2013 as compared to the highest price prevailed prior to the price fixation is as below :

| %reduction with respect to Maximum Price   |   No. of formulations |
|--------------------------------------------|-----------------------|
| 0<= 5%*                                    |                   236 |
| 5<=10%                                     |                   138 |
| 10<=15%                                    |                    98 |
| 15<=20%                                    |                   100 |
| 20<=25%                                    |                    92 |
| 25<=30%                                    |                    65 |
| 30<=35%                                    |                    46 |
| 35<=40%                                    |                    26 |
| Above 40%                                  |                    59 |
| Total formulations in NLEM 2015            |                   860 |

Details of ceiling price fixed is available on the website of NPPA i.e. www.nppaindia.nic.in.

(c): The  Department  of  Science  and  Technology  has  been  implementing  the Drugs  and  Pharmaceuticals  Research  Programme  (DPRP)  since  1994-95  having activities  of  collaborative  projects  (Industry-academia  Partnership)  and  National facility projects (state-of-the-art infrastructure projects). During 2004-05, the programme started extending  soft  loans  to  Indian  Pharma  Industries.  Further,  this programme supported Grants-in-aid to Indian Pharma Industries for Clinical Trials in neglected  diseases  such  as  malaria,  kala-azar,  Tuberculosis,  Filariasis,  etc.  from 2008-09 onwards.

The loan component of DPRP was discontinued from 2018-19 onwards, as similar  type  of  programmes  are  being  implemented  in  Technology  Development Board (TDB) and Biotechnology Industry Research Assistance Council (BIRAC) of Department of Biotechnology. The other components of DPRP such as collaborative projects,  facility  projects  and  Grants-in-aid  to  Indian  Pharma  Industries  for  clinical trials are being continued.

The Department of Biotechnology (DBT), towards strengthening the product development  for  Biopharmaceuticals, has  initiated  a  Mission  entitled: IndustryAcademia  Collaborative  Mission  for  Accelerating  Discovery  Research  to  Early Development for Biopharmaceuticals  -  'Innovate  in  India  ( i3 )  Empowering  biotech entrepreneurs & accelerating inclusive innovation'. The National Biopharma Mission approved by the Cabinet at a total cost of US$ 250 million for five years with 50% funding  through World  Bank  loan  is  being  implemented  by  Biotechnology  Industry Research Assistance Council (BIRAC) - a Public Sector Undertaking of Department of Biotechnology (DBT). The Mission is focusing on development of (i)Vaccines for Pneumococcus, Dengue, HPV and candidates for other diseases of high burden in India  (ii)  Biosimilars  for  cancer,  diabetics  and  rheumatoid  arthritis  and  (iii)  Medical devices and diagnostics (iv)Process Development Laboratory; Chemistry, Manufacturing, Control Units and cGLP validation facility for Bio therapeutics. DBT has  supported  R&D  projects  in  disease  areas  covering  Japanese  Encephalitis, Chikangunya, Dengue, Malaria, Visceral Leishmaniasis and Anti-Microbial Resistance.

The Department of Pharmaceuticals has set up seven National Institutes of Pharmaceutical Education & Research (NIPERs) as Institutes of national importance all over the country to impart masters and doctorate education and conduct research in various specializations of pharmaceuticals.

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