Although promotion of pharmaceutical products through doctors has been recognized as one of the reasons for high prices of essential drugs, the government is not yet successful in  bringing some check on this unethical practice prevailing in the industry. It is known to the Department of Pharmaceuticals that a  major part of the cost of  prescription drugs is on account of the loading of the promotional expenditure on their prices. What percentage of the cost of medicine is contributed by the promotional expenditure is, however, not known to the authorities as it is not revealed in the books of account of the companies. It is usually shown as part of the overall marketing expenditure. For the pharma companies, increase in prescriptions will decide the sales growth  and profits whereas for doctors, dependability of companies on them, bring unlimited returns by way of incentives for prescription. Decades ago, these promotional expenditures used to be in the form of some small gifts, useful to the practice of the medical profession. Today promotion turned out to be large cash payments, expensive gifts and sponsoring of pleasure trips to the doctors. Such expenditures to thousands of doctors in the country will obviously mean a huge burden to pharma companies necessitating to load it on to drug prices. The matter caught the public attention only lately after a series of reports appeared in the media regarding open bribing of doctors by pharmaceutical companies.

The Department did take some initiatives to curb this practice, of late, and has been pressuring the industry associations to come out with some solutions to the issue. The two leading associations IDMA and OPPI have been hesitant to take up the matter seriously as several of  their members are indulging in this practice. Both had prepared a voluntary code of marketing and claims to have circulated among their members. One should not expect such code of ethics will ever be followed  by the member companies as they are voluntary and there cannot be any pressure on companies from the associations. The Department had, therefore, called two meetings of the industry associations early this year and OPPI has been asked to draft a common code of marketing practices for the entire industry. Nothing could be finalized in those two meetings. Even in the latest meeting called by the Department last week, no decision could be arrived at as major differences cropped up among the industry associations, especially between the big and small players. At the meeting, OPPI and IDMA wanted a uniform code of marketing practices but should not be binding on the industry. SPIC representing most of the small pharma companies, however, sought for a legally binding uniform code. In fact, SPIC’s members are also victims of aggressive promotions as they cannot afford to pamper the physicians as MNCs and large Indian companies do. A marketing code without any legal sanctity makes no sense and cannot bring any end to the ongoing unethical practice. Therefore, the Department has to press for a legally binding marketing code on companies if the whole exercise has to have any meaning. Once that is done, enforcement of the code will be another tough job for the Department.