News Feature | December 19, 2014

Indian Regulators Cap The Prices Of 52 More Essential Medicines

By Suzanne Hodsden

Amid ongoing backlash from the pharma industry, the National Pharmaceutical Pricing Authority (NPPA) has announced price caps for 52 more medicines deemed to be essential for public health in an ongoing effort to improve healthcare affordability. The NPPA has currently fixed the prices on over 400 medicines, Reuters reports.

The medicines added to the list include antibiotics, painkillers, cancer treatments, and skin disorder drugs. Companies affected by the caps include Lupin, Cadila, and the Indian arm of German-owned Merck. New dosages and formulations from these companies will have to submit applications for prior approval under the Drug Price Control Order (DPCO) of 2013.

This is the latest move in a back-and-forth effort to placate the pharma industry while addressing the needs of a large segment of the Indian population that lives on $2 per day. The Indian government formed the NPPA in 1997 and has been struggling to implement the basic tenants of its authority for over a decade.

Business Standard of India reported that an original list of 108 non-essential drugs submitted by the NPPA in May was rescinded in September after the NPPA came under fire and was threatened with litigation by drug companies such as Sanofi, the Organization of Pharmaceutical Producers of India (OPPI), and Indian Pharmaceutical Association (IPA).

Because the existing laws are vague, regulators are having a tougher time establishing which medicines are essential and which are not.

Nature reports that patient advocates worry that drug makers might side-step the caps and promote other versions of the same medications that are not capped, and the price fixed medication might no longer be prescribed. Alternate versions might be even more expensive than those listed under the cap.

Still, Tapan Ray, director-general for the Organization of Pharmaceutical Producers of India (OPPI) told Nature that the move was “prudent for India in the long-term” even though the industry will doubtlessly sustain considerable losses.

Nature projects that the caps will reduce the existing market by $248 million.

A spokesperson from Lupin told Business Standard, “Though Lupin will not see any impact, we have always maintained that competition is a great leveler and the market finds its own level when it comes to matters such as pricing.”