Indian pharmaceutical industry has grown over the years to a major industrial segment of the country supplying almost all the necessary medicines to its population. Unlike any other industry, this sector has a critical role in maintaining the health of the country’s population. With the disease profile of the country changed vastly over the years, the patient community is under pressure to use a large number of essential drugs for life long. This situation demands availability of quality drug products at reasonable prices in the market place. But that is what is not happening in the country today. There are quality medicines at very high prices marketed by large and multinational drug companies, there are substandard drugs marketed by small scale drug companies at lower prices and spurious drugs marketed by anti social elements. It is a fact that the country has a Central and state drug administrations to enforce quality standards and eliminate substandard and spurious drugs. But, the drug administration is rather ineffective as majority state governments have weak drug control departments. And for making available quality drugs at reasonable prices, there is a centrally administered by National Pharmaceutical Pricing Authority of the Union chemicals ministry. NPPA has so far failed to achieve this objective on account of various reasons.

It is in the light of these factors, the Centre has been exploring the possibilities of bringing about a mechanism by which quality essential drugs are made available at low prices. Lack of coordination between various ministries is cited as the single key reason for not achieving this goal. Currently, the NPPA under the chemicals ministry is the regulatory agency to control the prices while the CDSCO under the health department is looking after the drug approvals. This has prompted Cabinet secretariat to think in terms of bringing an effective coordination between different departments. Of late, Planning Commission has also recommended that National Pharmaceuticals Pricing Authority be placed under the Union ministry of health. The proposal may not be easily acceptable to the chemicals ministry for obvious reasons. One has to realize that the Union health ministry is the government agency which monitor the public health and disease profile of the country on a regular basis. Therefore the authority to determine the list of essential drugs, its periodical revision and fixing drug prices should ideally rest with the health ministry. With the power to grant marketing approval for new drugs lying with the health ministry now, price fixation and its enforcement can be more effectively done by the same government arm.