New pharma policy to restrict power of NPPA to fix prices

New Delhi: The government has come up with a new draft pharmaceutical policy for prescribing the level of trade margins to bring down the prices of drugs. The draft also states that the drug pricing regulators will have the power to fix the prices of essential medicines only.

Currently, the National Pharmaceutical Pricing Authority (NPPA) functions as an autonomous body that regulates prices of medicines under the National List of Essential Medicines as well as other medicines that are not on the list. However, it has now been proposed to limit the powers of this apex regulator to fixing prices of essential drugs only.

According to the latest draft pharma policy prepared by Department of Pharmaceuticals (DoP), NPPA can cap prices of only those drugs included in the National List of Essential Medicines (NLEM). The NPPA should lay down and enforce price ceilings of “selected medicines” and ensure that “adequate quantities” of the drugs are available.

While other recommendations have been made by the policy to strengthen the regulatory body, at the same time NPPA may lose the absolute power to fix drug prices, if this policy comes into effect

“National List of Essential Medicines will remain the basis of the medicines to be brought under price regulation… the Department of Pharmaceuticals will prepare the list of medicines for price regulation and transmit them to the NPPA for fixing the price ceilings,” ET quotes the latest draft of the pharmaceuticals policy as stating.

The draft policy talks about making the voluntary code for marketing a mandatory requirement for companies operating in India. “Doctors are lured to recommend a particular brand through all expenses paid trips often disguised and called ‘educational conventions’ and such other incentives. While The Drugs & Magic Act prohibits any advertisement of a drug, such ‘educational’ conferences are used to circumvent and play the trick. These add to the overhead cost of the drugs," quotes Business Standard

The draft also states that the government intends to push the sale of medicines using the salt name instead of the brand for generic drugs.

Fixed-dose combination drugs will be allowed to put a brand name, however, rest of the drugs would have generic names only. Proposal for e-prescriptions is also part of the draft so that doctors prescribe generic names without any hassle.