Pharmabiz
 

NPPA & PRICE CONTROL

JOE C MATHEWWednesday, July 6, 2005, 08:00 Hrs  [IST]

The National Pharmaceutical Pricing Authority (NPPA) has been working overtime to fix the prices of bulk drugs and formulations during the current year. It has already notified the prices of 412 formulations and 51 bulk drugs /derivatives since January 2005. The six months' record of NPPA is almost double than that of the price fixations it carried out last year, as it fixed prices of just 48 bulk drugs and 229 formulations during 2004. This acceleration in revising/fixing drug prices has resulted in a bulk drug/derivative price reduction ranging from 0.1 per cent to 64.4 per cent in just one year. Of the prices of 513 formulations that were fixed during July 2004 – June 2005, only 49 cases reported an upward revision. In 244 cases, the prices were reduced in the range of 1 per cent to 50 per cent. The new found enthusiasm could be attributed to several factors, most important being the reported pressure from Ram Vilas Paswan, the Union Chemicals and Fertilizers Minister to keep drug price levels at check. Apparently, the minister and NPPA are all for the consumers – a development that needs to be lauded. However, there is a flip side to the whole issue. The price fixations have left the domestic pharmaceutical industry fuming with its usual complaint that the price fixations are not based on proper data and are unrealistic and impractical. For instance, there is pressure on NPPA to revoke its June 15th decision to fix Erythromycin price at Rs 2063 per kg. It has been alleged that the prices fixed are too low as compared to the prevalent international prices. The industry argues that the rock-bottom price would compel the existing manufacturers to discontinue its production and the high international prices would make alternate imports impossible. They feel that the discontinuation of these products would not only affect the industry, but also result in drug shortage, thereby working against the very same consumer interest. The NPPA price fixation has always had its share of controversy with both the authority as well as industry holding each other responsible for the non-availability of accurate data for price fixations. If the industry's unwillingness to part with the confidential data is troubling NPPA, the absence in confidentiality of the data that are passed on to NPPA is the burning issue before the industry. No sensible price fixation can be carried out under such circumstances. The piece-meal efforts initiated by NPPA to keep check over drug prices are certainly encouraging, but cannot be a lasting solution. The Task Force headed by Pronab Sen, Principal Advisor, Planning Commission, is looking into the issues of drug price control, should include appropriate recommendations to have in place a transparent and complaint free mechanism for drug price fixation.

 
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