The NPPA has issued the revised internal guidelines to dispose of Form-lV applications of discontinuation of production/import of scheduled formulations under paragraph 21 (2) of the DPCO, 2013 for issuance of 'no objection certificate' by the NPPA.
The NPPA in its 39th meeting held on 21.12.2016 discussed the issue in the light of recent acute shortage of some essential medicines and modified the guidelines in supercession of the earlier guidelines.
According to the revised guidelines, wherever Moving Annual Turnover (MAT) (in units) of the applicant company is less than ten percent of the total MAT (unit) value of the formulation, no objection may be granted by NPPA with the approval of the chairman without referring the case to the Authority for gradual discontinuation and the applicant company will be advised within a period of 60 days from the receipt of Form-IV application to continue to manufacture I import and sell the formulation for a period of minimum six months from the intended date of discontinuation, as the case may be. The company should not reduce level of production by more than 25 per cent (of previous year's production in each quarter) after getting permission from NPPA.
During this period the company shall follow the ceiling price fixed by the NPPA and notified from time to time. The company intending to discontinue the scheduled formulation from the market shall also issue a public notice in the prescribed format in at least two national newspapers (one in English and one in Hindi newspaper).
Wherever MAT (in units) of the applicant company is ten percent or more but less than twenty five percent, "no objection" may be granted by the NPPA with the approval of the chairman, for gradual discontinuation and the applicant company will be advised within a period of 60 days from the receipt of Form-IV application to continue to manufacture/import and to sell the formulation for a period of minimum 09 months from the intended date of discontinuation, as the case may be. The company shall not reduce level of production by more than 25 per cent (of last year production in each quarter) after getting permission from NPPA. During this period the company shall follow the ceiling price fixed by the NPPA and notified from time to time. The company intending to discontinue the scheduled formulation from the market shall also issue a public notice in the prescribed format in at least two national newspapers (one in English and one in Hindi newspaper).
All cases where the MAT volume of the formulation intended for discontinuation is 25 per cent or more, shall be put up for the decision of the Authority. No objection may be granted by the Authority, for gradual discontinuation after ascertaining the availability and the applicant company may be advised within a period of 60 days from the receipt of Form-IV application to continue to manufacture/import and to sell the formulation for a maximum period of twelve months from the intended date of discontinuation. The required level of maximum reduction in production shall not be more than 25 per cent in a quarter. The manufacturer will also follow other conditions as may be prescribed.
In exceptional circumstances as where the formulation intended for discontinuation has more than. 25 per cent share and the proposed discontinuation may cause short supply of the drug, and public inconvenience, cases will be decided on merit and will be subject to approval of the Authority. NPPA will explore the possibility of alternative arrangements to supplement the production gap likely to be caused by such withdrawal by referring the matter to other manufacturers of the same formulation and also to Department of Pharmaceuticals for a direction to Government PSU's under Para 3 of DPCO, 2013 to produce the formulation if possible. NPPA may also consider an upward price revision under Para 19 if the formulation is proposed to be discontinued on account of non-remunerative pricing, a ground which needs to be established by the manufacturers. The no - objection for discontinuation in such cases will either be deferred till alternative arrangements are ensured, or the Authority may allow partial discontinuation on case-to-case basis.
Besides, whenever a formulation is found to be critical for public health, based on circumstances and also in cases where established, based on evidence with NPPA that the manufacturer is intending to discontinue production of a scheduled formulation and has already launched or intends to launch 'a new drug' just to evade price control and where the continuation of production of that formulation is critical for public health, NPPA will refer such cases to Government for exercising powers under Para (3) of the DPCO, 2013 to ensure supply of such formulations for such period as it considers necessary.
In cases where Form-IV application is received for a formulation which is legally banned, "no objection" may be issued by the NPPA with the approval of Chairman, after being satisfied in this regard, without referring the case to the Authority.
NPPA shall ordinarily not allow discontinuation of a scheduled formulation where the manufacturer had not complied with notified ceiling price or where there is an ongoing overpricing case pending against the pharmaceutical company. In all such cases, the manufacturers shall be asked to deposit the overpriced amount with interest for availing the benefit of discontinuation.
The manufacturers, shall submit along with Form IV application copies of Form-II, Ill and V for the last two years filed in Integrated Pharmaceutical Database Management System (IPDMS) in respect of formulations being discontinued, without which the application (Form-IV) shall be summarily rejected by NPPA.
The public notice should be issued by the manufacturer only after it has communicated its intention to discontinue the formulation to the Government and after receipt of intimation from NPPA to do so. The public notice as prescribed shall be issued by the manufacturer in such a way that the general public gets enough time to make alternate arrangements by consulting doctor etc.
These guidelines will be effective with immediate effect and be applicable to all cases under consideration and future cases.