The pharmaceutical industry, still coming to terms with the Drug Price Control Order (DPCO), 2013, which controls the prices of 652 drugs coming under the National List of Essential Medicines (NLEM), now has to deal with 108 more formulations, which have been brought under the price control.
The National Pharmaceutical Pricing Authority (NPPA) last week, invoking Paragraph 19 of the DPCO, has included more drugs such as cardiac and diabetes medications under the list.
Now, 60 per cent of cardiac medicines and 21 per cent of anti-diabetes drugs in the market are under the price control.
While this is good news for consumers, pharmaceutical manufacturers are upset that this will further erode their profit margins.
Paragraph 19 of the DPCO says the government may fix the ceiling price or the retail price of any drug “in case of extra-ordinary circum- stances”. “It is a bolt from the blue, and the decision was taken without consulting the stakeholders,” said S. V. Veeramani, President, Indian Drug Manufacturers’ Association (IDMA), adding, that no extraordinary circumstances had arisen to provoke such action.
He said the DPCO 2013 already cost the industry more than Rs.1,000 crore, and the new list would deplete a further Rs.600 crore.
According to Sarabjit Kour Nangra, a pharmaceutical analyst at Angel Broking, it is estimated that around Rs.5,500 crore of the pharma market will be impacted with product prices being reduced from 10-15 per cent to as high as 35 per cent with the average reduction around 12 per cent.
Figures of pharmaceutical market research company AIOCD AWACS show companies are set to lose significant sales due to the expanded list. Sanofi will lose Rs.139 crore, Zydus Cadila Rs.40 crore, Ranbaxy Rs.38 crore, Lupin Rs.32 crore and Sun Pharmaceuticals Rs.25 crore.
“This would not only enlarge the span of control hurting the industry, but the arbitrary method of price fixation for non-schedule products could also jeopardise their availability to patients,” Dilip Shah, Secretary, Indian Pharmaceutical Alliance (IPA), told this corres- pondent.
