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    • NPPA likely to cap...

    NPPA likely to cap retailer margins of 73 cancer and rare disease drugs: Report

    Meghna A SinghaniaWritten by Meghna A Singhania Published On 2019-02-21T15:13:40+05:30  |  Updated On 16 Aug 2021 3:03 PM IST

    However, the move is likely to stimulate retailers to spend more as trade margins on drugs that have somehow bypassed the list and the retailers may push such drugs to earn greater margins.


    New Delhi: A relief to patients will soon ensue as the drug price regulator National Pharmaceutical Pricing Authority (NPPA) is expected to cap trade margins of 73 cancer and rare disease drugs. According to a recent media report, a decision in this regard will be taken on Thursday in the official meeting of NPPA.


    The move will help expand the range of price control to cut down overcharging on various drugs which are presently excluded from the purview of government regulation.


    TOI reports that following the directions from the Prime Minister's Office in the month of January, the Directorate General of Health Services has prepared the lists of these 73 drugs.


    Also Read: NPPA fixes retail price of Emcure pharma's HIV drug



    The two lists as reviewed by TOI reveals 35 cancer drugs included in one and the other contains 38 medicines for treatment of rare diseases. However, many commonly used cancer drugs with high annual turnovers do not fall in the list.

    For instance, key oncology molecules like nivolumab used for lung cancer, cetuximab used in colorectal cancer, and breast cancer drug palbociclib are not included in the list.


    As per the statistics total oncology market is estimated to be Rs 3830 crore annually while topmost 50 brands contribute 53 per cent of the total cancer market.


    Earlier media reports brought to light that the government has been working to cork the trade margins as the PMO felt an immediate need for government intervention to cut down excessive margins charged by stockists and retailers on "commonly used" tumour drugs as well as those for rare diseases.


    By regulating trade margin of such medicines, the government aims to make them affordable while restricting excessive profits earned by wholesalers, distributors and chemists.


    Trade margins form a vital portion of MRP of a drug and companies often pay sky-high margins to the trade chain to thrust their drugs through retailers.


    Also Read: Relief to Foreign Drugmakers: No price cap on innovative drugs for first five years



    Currently, the government caps the trade margin on schedule or price-controlled medicines at 8% and 16%, respectively for wholesalers and retailers. However, incase of non-scheduled drugs, companies are independent to negotiate with traders on margins.

    Though the decision, incase taken in the regulatory meeting to be held on Thursday will ease patients, yet the move has triggered concerns.


    Since the list has excluded commonly used medicines with higher market turnovers which entails a potential risk that the retailers may dispense another and cheaper medicine than the one prescribed, sources told the daily.


    "By creating a list of drugs, the government has opted for a discriminatory approach where some drugs with same therapeutic efficacy are outside the list. This will lead to market inequities and scope for malpractices," an industry executive told TOI.


    The government's decision to cap trade margin which is expected to happen shortly will indeed restrict stockists and retailers to overcharge on the drugs enlisted. However, the move is likely to stimulate companies to spend more as trade margins on drugs that have somehow bypassed the list and the retailers may push such drugs to earn greater margins.


    Also Read: Draft pharma policy calls for trade margins cap

    breast cancebreast cancerbusiness newscancer drugscolorectal cancerdrug retailersdrugsgovt of indiaIndia Business Newsindian govtMRPNational Pharmaceutical Pricing AuthoritynivolumabNPPAoncologyoverchargePharma companiespharma newspharmacists newsrare diseaserare diseases drugretail marginsstockiststrade margintrade margins
    Source : with inputs

    Disclaimer: This site is primarily intended for healthcare professionals. Any content/information on this website does not replace the advice of medical and/or health professionals and should not be construed as medical/diagnostic advice/endorsement or prescription. Use of this site is subject to our terms of use, privacy policy, advertisement policy. © 2020 Minerva Medical Treatment Pvt Ltd

    Meghna A Singhania
    Meghna A Singhania

      Meghna A Singhania is the founder and Editor-in-Chief at Medical Dialogues. An Economics graduate from Delhi University and a post graduate from London School of Economics and Political Science, her key research interest lies in health economics, and policy making in health and medical sector in the country. She can be contacted at editorial@medicaldialogues.in. Contact no. 011-43720751

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