The uncertainty with regard to the introduction of MRP inclusive of taxes regime in drugs is likely to continue even if the Union Chemicals Ministry notifies a deadline for its implementation, it is feared. The cause of worry is the absence of a concrete formula to calculate the MRP inclusive of taxes amount for price controlled drugs in the current Drug Price Control Order (DPCO). Any piece-meal effort to implement the government plan would create more confusion, fears the industry.
Repeated discussions the industry leaders had with the department of chemicals and the National Pharmaceutical Pricing Authority (NPPA) on the need for a proper MRP determining formula failed to achieve anything. No commitment has been given by the department on this issue, it is learnt.
According to sources, the industry had asked the chemicals ministry to ensure a substantially high abatement to include the burden of taxes also within sale price. The suggestion was put up before the finance ministry also, but got rejected. Since then, the department has been putting the onus of complying with MRP inclusive printed rates on the industry.
The industry is known to be expecting the government to allow some percentage of MAPE to be added to the scheduled price to include all taxes and levies before MRP inclusive prices can be printed on the labels. Such moves can also result in marginal gains for the industry/trade in some states, as the taxes and levies are not uniform across the country. Whatever be the case, an official endorsement is needed if the industry has to print MRP inclusive of taxes on price fixed formulation packs.
As Pharmabiz had reported earlier, the government is planning to notify October 2, 2006 as the deadline for switching over to MRP inclusive regime. The notification has to also clarify that the change in rules may not be applicable to packs that have reached the markets before October 2.