National Pharmaceuticals Pricing Authority (NPPA) may review the current 10 per cent ceiling on hike in prices of non-scheduled formulations, it is learnt. The move is in view of the industry's criticism of NPPA for its aggressive stand with regard to price control.
Moved by different organizations and pharma majors, the Chemicals Ministry has forwarded its observations on the issue to the NPPA. However, without taking a favourable stand on the matter, it has passed the buck to the price regulator to decide on increasing the ceiling, claiming that it was the prerogative of the NPPA.
NPPA sources said they would study the comments from the Ministry and take a decision, but remained non-committal on increasing the ceiling as per the demand by the industry. Chemicals Department sources said they would take a call at present.
Last year, NPPA had revised the guidelines to limit the ceiling on the price increase to 10 per cent an year, from 20 per cent, triggering criticism from the industry circles. The pharma majors also have accused the NPPA of going `more active' by expanding the list of controlled drugs.
The DPCO stipulates price control only on 74 bulk drugs and their formulations now. Prices of all the other drugs and their formulations can be fixed by the companies as they are outside price control. However, by invoking the provision -Para 10(b) of the Drug (Price Control) Order, 1995 (which allows any drug to be brought under price control to protect public interest), the NPPA has brought scores of drugs under control, much to the discomfort of the pharma majors.
This has created rift between the industry and the government, forcing the former to take up the issue with the Ministry. However, Chemicals Minister Ram Vilas Paswan who felt cheated by the industry on the promise of voluntary cut in the prices of 886 drugs was not in favour of increasing the ceiling and thus left the ball in the court of the NPPA, it is learnt.
According to the latest available statistics, the NPPA has sent notices to 460 companies, more than half of them as per the revised ceiling of 10 per cent, for overcharging and the industry owed about Rs 1438 crore as penalty. A whopping Rs 1337.95 crore is yet to be recovered. Under the formulation category, the NPPA so far approved 394 packs during the current financial year. Prices of 37 packs were increased and prices of 197 medicines were reduced. For the first time, prices of 154 packs were fixed during the year. Thus a total of 394 packs were monitored by the agency this year. In the bulk drug category, only 16 medicines came under price fixing and prices of 12, out of the total number, were decreased. Since its inception, the NPPA has thus fixed the prices of 372 bulk drugs, sources said.