National Pharmaceutical Pricing Authority (NPPA) will need to move away from a frequent price revision mode, instead it would be more appropriate to opt for quarter or half yearly format, said Dr. BR Jagashetty, former National Adviser (Drugs Control) to MoHFW & CDSCO and former Karnataka state drugs controller.
The numerous price adjustments are confusing not only to the manufacturers and pharmacy trade but also to the patient population. It is highly impractical to alter pricing at frequent intervals and the Authority should devise some methodology so that the revision can take place biannually or quarterly, he said.
Moreover, it would be most appropriate for the government to bring the concept of drug price monitoring cells it mandated across the state drugs control departments in 2015. In fact, this model was implemented in Rajasthan, UP, Karnataka and Kerala. NPPA will be able to implement effective price monitoring of drugs and report violations through such dedicated cells, said Dr. Jagashetty adding that it could be immediately enforced depending on the availability and capability of staff by financing.
Commenting on the NPPA’s move to implement affordable medicare and health security by making the drug pricing policy favourable for the poor patients, he said that there needs to be certain structural modifications. The format is skewed in the sense that the measures issued on April 21, 2017 indicate a combination of generics and brands. This disagrees to the recent prime minister Modi’s statement to prescribe only generic drugs. There is also a contradiction to NPPA’s pricing method for a combination of generics and brands which is based on market data but not the cost based format, he added.
The cost based method is preferred because the profit margin of raw materials, excipients, adjuvants, packaging and other incidentals need to be included. Therefore, if the NPPA and Department of Pharmacy (DoP) are contemplating to revise the norms they need to consider cost based format over market based pricing in view of non-availability of actual market data.
About the price cap on pre-manufactured stock available in the market from the date of notification of ceiling prices, he said that the move was absurd and there was no clarity on whether this referred to raw materials like APIs or excipients or otherwise.
Moving on to the clause for reduction of MRP by wholesale price index (WPI) for all scheduled medicines including those formulations being sold below ceiling price, Dr. Jagashetty said that there was some ambiguity because there was no basis as to how this was calculated.