NITI Aayog asked to revamp process of drug selection for price control

New Delhi: The system of selections of drugs for Price Control may now undergo a sea change as the government has asked the NITI Aayog to revamp the current system of price fixation in consultation pharma lobby groups

Recent media articles report that this comes after the Prime Minister’s Office (PMO) asked NITI Aayog to interfere and address the dissatisfaction of the industry bodies over the proposed pharmaceuticals policy and price control

The pharma groups have also shown their worry over the current way of fixing price caps by National Pharmaceutical Pricing Authority (NPPA).

In the present scenario, the list of drugs suitable for price regulation is prepared by the health ministry after that the Department of Pharmaceuticals (DoP) incorporates the National List of Essential Medicines (NLEM) into Schedule 1 of the Drugs (Prices Control) Order (DPCO). Subsequently, the NPPA fixes the prices of drugs in this schedule.

Thereafter, NLEM listed drugs and devices must be sold at the price fixed by NPPA while non-scheduled listed drugs are permitted to have a maximum annual price hike of 10%. Around 750 formulations are currently present in India’s list of essential medicines.

According to Mint, the PMO has asked Niti Aayog to prepare a roadmap to revamp the process of drug selection for price control and submit a report to the PMO based on their consultations with the pharma lobby groups and pharma experts.

In its meeting with pharma sector experts, NITI Aayog officials had asked them to share their views on NLEM, whether it should be linked to DPCO, which drugs they think should come under price control, whether there is any need to amend the DPCO, how they think price caps should be determined and whether they agree with the current method.

The pharma lobby was also asked to propose changes in the manner the government identifies medicines that should be brought under price control and what they feel is the best approach to have timely additions and deletions in NLEM. Besides this companies were asked to share their views about the maximum allowable trade margins on ex-factory price.

Speaking with Mint a person knowing about the matter said, “Price control has been an area of concern not only for the pharmaceutical industry but also for the NPPA, which is the price governing body. Various efforts have been made to get the correct balance between the interests of the consumers and pharmaceutical industry but to no avail. Niti Aayog has been told to bridge that balance and look at the concerns of both consumers and pharma lobby groups.”