Drug Policy In India

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Pricing

22.7.1   SINGLE LIST OF PRICE CONTROLLED DRUGS & "MAPE"

The system of price control may be operated through a Single list of price controlled drugs and formulations based thereon with a MAPE of 100 per cent.

22.7.2 SPAN OF CONTROL

(i) The criterion of including drugs under price control will be the minimum annual turnover of Rs.400 lakhs.

(ii) Drugs of  popular use, in which there is a monopoly situation will be kept under price control. For this purpose if for any bulk drug, having an annual turnover of Rs. 100 lakhs or more there is a single formulator having 90% or more market share in the Retail Trade (as per ORG) a monopoly situation would be considered as existing.

(iii) Drugs in which there is sufficient market competition viz. at least 5 bulk drug producers and at least 10 formulators and none having more than the 40% market share in the Retail Trade (as per ORG) may be kept outside the price control. However, a strict watch would be kept on the movement of prices as it is expected that their prices would be kept in check by the forces of market competition. The Government may determine the ceiling levels beyond which increase in prices would not be permissible.

(iv) Government will kept a close watch on the price of medicines which are taken out of price control. In case, the prices of these medicines rise unreasonably, the Government would take appropriate measures, including reclamping of price control.

(v) For applying the above criteria, to start with, the basis would be the data upto 31st March, 1990 collected for the exercise of the Review of the Drug Policy. The updating of the data will be done by the National Pharmaceutical Pricing Authority as detailed in para 22.7.4 (i).

(vi) Genetically engineered drugs produced by recombinant DNA technology and specific cell/tissue targeted drug formulations will not be under price control for 5 years from the date of manufacture in India.

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