The union minister for Fertilizers and Chemicals Ram Vilas Paswan said the government would soon bring in another 300 drugs under the Drugs Price Control (DPCO) as part of the government's commitment to offer life savings drugs at affordable prices to the poor.
The minister said the prices for these drugs would be fixed at about twice the production cost. At present the government is directly regulating the prices of only 74 drugs. Even if the government increases the number of drugs under DPCO to 374, the industry need not complain, as another 3000 odd drugs would be outside the purview of control. There is no need to further discuss the matter with the industry and seek their opinion, as the subject comes under the jurisdiction of the government, said Paswan on Sunday in Chennai.
The minister said it was observed that many firms and the traders were enjoying huge profit margins, hinting at the recent market study undertaken by the Delhi drug administration at the behest of the minister on the trade margins of certain popular drugs in the Delhi market. He said the government at present monitors firms that produce drugs with a turnover of over Rs 4 crore, and the government move will help to monitor more SSI drug makers.
He noted that some states have announced four per cent VAT on medicines and the other states should also implement the same to bring in uniformity in dug prices. At present drug companies give 'local taxes extra' in the label, and the prices of medicines vary marginally from state to state. It is necessary to bring in transparency in this area and the industry and traders should not be allowed to exploit poor. As part of the move to resolve the sales tax issue, a meeting of the state finance ministers and health ministers have been convened on 18 of August, said the minister.