National Pharmaceutical Pricing Authority had approached Union health ministry last month to find ways how to check the pharmaceutical companies from systematically circumventing price control norms. Ever since, DPCO 1995 was notified, pharma companies have been resorting to methods to evade price control by either altering the specified strength of ingredients in formulations or adding ingredients not listed in the controlled category of drugs. NPPA had first detected cases of violation of price control in case of tablets and capsules shortly after the notification of DPCO. That time companies have been either changing the standard sizes of strips or slightly altering the strengths of tablets to escape price control. This practice was curbed through a notification issued by NPPA on January 27, 1998 by fixing prices on a pro rata basis for strips. In January 2008, NPPA had again detected large scale dodging of price control by pharma companies by altering pack sizes or strengths of another set of formulations. This time the companies have been evading price control in the case of syrups, liquids and creams. NPPA had stumbled upon an ORG survey that time wherein several pharmaceutical companies have been found to be marketing nonstandard pack sizes of syrups, tonics and creams to escape price control. Most recently, the NPPA detected yet another way of circumvention of price control by certain companies. This is by way of mixing food and nutrition supplements with some drug formulations. NPPA had collected some samples from the market to examine the new practice in this regard. In one of such case, Merck India Ltd had classified its leading vitamin E brand, Evion 400 tablets, into a dietary supplement just to come out of price control. The company obtained the product license with change in the composition from drug authorities of Daman.
The price regulator's decision to approach the health ministry is to find a permanent solution to this sort of violations by pharma companies. As it is finding it difficult to monitor price violations taking place in different parts of the country, NPPA has suggested certain measures to be implemented in consultation with the Drugs Consultative Committee and the Central Committee on Food Standards. These measures could be incorporated in the provisions of the Drugs & Cosmetics Act and the Prevention of Food Adulteration Rules. The matter has been already referred to the CDSCO to be taken up in the next DCC meeting. How effective will the proposed changes in the rules be, is something to be watched. It is easy to find loopholes in any law for the companies which are determined to circumvent or break it. Detection and follow up action can also take a lot of time for the government agencies in a vast country like India under the present system. What is therefore important is a spirit of cooperation by the industry with the government agencies and not a defeatist attitude.