Lok Sabha Question No. 1289 (UNSTARRED), answered on 2021-02-09
Subject: Rates of Essential Medicines
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Kaushalendra Kumar

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

LOK SABHA UNSTARRED QUESTION NO. 1289 TO BE ANSWERED ON 9 th  February, 2021

## Rates of Essential Medicines

## 1289. SHRI KAUSHALENDRA KUMAR:

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

- (a) whether the NPPA is not working actively as there is strict norms on DPCO, still pharma companies are increasing the rates of essential medicines and if so, the details thereof;
- (b) whether it is true that pharma companies are overcharging on maximum medicines and if so, the details thereof;
- (c)  whether the price increase in essential eye drops like Timolet-OD, Bimat, Betagan and Lumigan since the last two years has also indicated overcharging by pharma companies;
- (d) the extent of price rise of essential drugs under the DFPCO list;
- (e) whether the Government has any mechanism to control the DPCO prices; and
- (f) if so, the details thereof?

## ANSWER

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

(a): National Pharmaceutical Pricing Authority (NPPA)  under the Department of Pharmaceuticals (DoP) is working actively as per provisions of the Drugs (Prices Control) Order (DPCO) and fixes the ceiling prices of scheduled drugs listed in the National List of Essential Medicines (NLEM) and included as Schedule - I of the DPCO, 2013. The scheduled formulations comprise approx 18% of Market. Till date, under DPCO, 2013 NPPA has fixed the prices as under:

- (i) Ceiling price of 881 scheduled formulation under revised scheduled I of DPCO, 2013.
- (ii) Retail price of 1474 new drugs under the DPCO, 2013.
- (iii) Prices  of  106  Anti-diabetic  and  Cardiovascular  drugs  under  Para  19  of  the DPCO, 2013 in public interest.
- (iv) Ceiling price of Cardiac Stents being scheduled formulation under the DPCO, 2013 affecting price reduction for Coronary Stents up to 85% for Bare Metal Stents and 74% for Drug Eluting Stents.
- (v) Ceiling price of Orthopaedic Knee Implants under Para 19 of the DPCO, 2013 in Public interest affecting price reduction for orthopaedic Knee Implants up to 69%.
- (vi) Capped  the  Trade  Margin  of  non-scheduled  formulations  of  42  Anti-cancer medicines under 'Trade Margin Rationalization' approach as a Pilot for proof of concept, wherein price of more than 500 brands of medicines were reduced up to 90%.

The fixation of prices has resulted in a notional savings of about Rs. 12,447 crores per annum to the public after implementation of the DPCO, 2013.

- (b): NPPA, an independent body of experts monitors the prices of Scheduled and Nonscheduled drugs in the country as per provisions of the DPCO, 2013. If a company violates the provisions of DPCO, 2013, action for overcharging is taken against it. NPPA has initiated 2116 number  of  overcharging  cases.  An  amount  of  Rs.  978.82  Crore  has  been  recovered  till 31 st December, 2020 from pharmaceutical companies.
- (c): Of the four medicines, Timolet-OD is a scheduled formulation. NPPA has fixed ceiling price of Timolet-OD (containing Timolol 0.5% Drops) at Rs. 11.89 per ml vide SO No. 1213(E) dated 25.03.2020 and the formulation is in compliance with the ceiling price fixed. Further, in case of the remaining three Non scheduled formulations, as per market-based data referred by NPPA, Betagan and Lumigan are in compliance with the provisions of Para 20 of DPCO, 2013, while in the case of Bimat overcharging has been indicated as per the provisions of DPCO, 2013. NPPA has initiated action against the manufacturer.
- (d): The ceiling price of scheduled  medicines (Branded or generic) is specified in the first schedule  of  DPCO,  2013  All  the  manufacturers  of  Scheduled  medicine  have  to  sell  their products within the ceiling price (plus  applicable local  taxes) fixed  by  NPPA. Further, the ceiling  price  of  scheduled  medicine  is  revised  on  1 st April  every  year  based  on  the  annual Wholesale Price Index (WPI) for preceding calendar year. Further, in case of Non-scheduled formulations manufacturers can increase the prices up to 10%.
- (e) & (f): NPPA, with the help of Price Monitoring & Resource Units (PMRUs) and State Drug Controllers (SDCs) regularly monitors and enforces the price fixed under the DPCO, 2013. Samples are also purchased from the open market throughout the country on random basis through SDCs to ensure price compliance. NPPA takes prompt action on the basis of complaints  received  regarding  overcharging  through  various  channels.  It  also  monitors  the prices of Non-scheduled formulations for increase in the prices beyond 10% during preceding twelve months.

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