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Medicines back in control raj
BS Corporate Bureau in New Delhi |
November 18, 2004 09:27 IST
To curb the rampant trade margins in the pharmaceuticals market, the government has decided to set a margin of 50 per cent -- 35 per cent for retailers and 15 per cent for wholesalers -- on generic drugs and 30 per cent -- 10 per cent and 20 per cent -- on branded drugs in the non-scheduled category.
In the case of scheduled drugs, the current norms -- 8 per cent for the wholesale trade and 16 per cent for retailers -- will continue.
Addressing the media at the Economic Editors' Conference in the Capital on Wednesday, the Minister for Chemicals, Fertiliser and Steel, Ram Vilas Paswan, said the Sandhu Committee, which was set up recently to look into the "span of control", had submitted its interim report with the above recommendation. The final report is due next month.
Apart from the margins, the committee has recommended that whenever a new drug is patented after January 2005, its price should be negotiated to keep it at a reasonable level.
The other contentious issues regarding the definition of "life saving drugs" has been referred to the All India Institute of Medical Science to advise the committee as to whether anti-cancer and anti-AIDS drugs can be classified as life-saving drugs.
"It is up to the health ministry to define the term lifesaving drug. Since it could not come up with the definition, AIIMS will advise the committee as to whether anti-cancer and anti-AIDS drugs could be classified life-saving."
Since there is no category as lifesaving drugs, the Sandhu Committee has recommended that it would be proper to consider the National List of Essential Medicines, 2003 (of 354 bulk drugs) to form the basket of drugs for introducing some kind of price management.
The committee has recommended that the process of monitoring prices needs to be strengthened considerably. It has suggested two types of monitoring, intensive and normal.
Intensive monitoring will include all drugs from the basket, which do not fall under the criteria for price control. Under this kind of monitoring, the committee has suggested fixing a lower cap on price increases -- which would range between 10 per cent and 15 per cent per annum.
The National Pharmaceutical Pricing Authority will continue to be the watchdog for drugs under normal monitoring. Suitable guidelines will be issued to the authority in this regard and the efficacy of its implementation will be watched for some time. Thereafter, if needed, the Drug Price Control Order could be suitably amended at a later stage.