In view of growing concern over the ambiguity of various clauses in the new drug price control order (DPCO), a panel discussion to demystify the issues and concerns was organised in Chennai by the Tamil Nadu branch of Indian Drug Manufacturers Association (IDMA).
The participants included representatives from manufacturing sector, associations of marketers and various trade bodies. The meeting drew up more than 100 people from various parts of Tamil Nadu and they discussed in detail the national pharmaceutical pricing policy 2012 (NPPP 2012) and the new NLEM 2011. The panelists included industry experts from TN IDMA, TN pharmaceutical manufacturers association (TN PMA) and IPA TN branch.
Even though issues like lack of clarity over strength of medicines in formulations, ceiling prices of 348 drugs in the national list of essential medicines, levy of various taxes and VAT were debated, the major concern raised by the SME captains was on limited time span of 45 days for recalling the drugs with higher prices from the market. The panelists informed the participants that the NPPA did not want a drug in the market with a higher price after the 45th day of the notification of new price order. It is the duty of the manufacturer to recall drugs with higher prices from the market and see that there is no violation of the new DPCO.
The discussion was mainly to focus on addressing concerns of the manufacturers and clearing their doubts on the principles for pricing of essential drugs in the NLEM 2011. To questions on levy of excise duty, the panelists said as per the new DPCO the MRP of a product is inclusive of the excise duty. The panel members said a manufacturer has to submit the revised price list to the drug control authorities on every three months. Prices of NLEM should be informed in Form 2, otherwise it will be considered as violation. The list of NLEM is being released batch wise.
Several questions on the subject were put to the panelists by the manufacturers of SSI units and traders. When asked if the ceiling price of a product manufactured for a Chennai based marketing company is Rs. 3.69 + VAT, will the MRP remain the same if it is sold to a company outside of Tamil Nadu, and central sales tax (CST) be applicable for it. The speakers in the panel said CST cannot be charged, but local taxes are applicable. Regarding change of strength of medicines, the manufacturers must approach NPPA.
To a doubt raised by a trader, the industry experts who moderated the discussion said if the existing price of a product does not appear in the new list, it can be increased by 10 per cent annually and old price order is applicable as far as the drug is concerned. They said only 34 drugs from the list of old DPCO are featured in the new list. The notification of NPPA is applicable from the date on which the prices of drugs are notified. Answering to a question from the SME side, the panelists said there is no exemption in any case for SMEs in the new DPCO.
The panel discussion encouraged greater understanding of the issues and analysed them with more clarity. However, concerns are remaining with the manufacturers on the limited period of time for taking back the unsold stock from the market. The members of the various associations assembled for the seminar wanted the industry leaders to take up the issue with the union government for an extension of time. IDMA vice chairman K Veeramani, who chaired the meeting, said the government is aware of the problem, but once the notification is out, nothing can be done.
TN IDMA president M Rajaratinam, TN PMA president, K Sethuraman and TN IPA secretary J Jayaseelan were in the panel of industry experts to moderate the discussion. Veeramani said an expert on the subject is being brought to Chennai on July 20 to further clarify the ambiguities in the new NPCO to the industry representatives.