Two areas in which the new government at the Centre is contemplating to bring some changes are in drug policy and in selling of public sector drug units. An indication to this effect has already come from the new Union minister for chemicals and fertilizers soon after he took charge of the ministry. As far as the new drug policy is concerned, a draft policy was introduced in 2002 by the last government. The draft policy sought to bring down the number of drugs under price control to a maximum of 30 in line with the declared policy of reducing the span of price control since 1986. Although most sections of drug industry accepted the policy draft, the whole process got stalled first in the Karnataka High Court and now in the Supreme Court. The government objective of a progressive reduction of drugs under price control is with the intention of retaining government control on essential and life saving drugs and at the same time reducing the administrative work. It was assumed that with the increase in production and competition, prices of bulk drugs and formulations will come down over the years. To a large extent, this assumption has been working and the prices of several decontrolled and even controlled bulk drugs had come down. But, pharmaceutical companies have been quite hesitant to pass on the reduced bulk drug prices to the common man while marketing formulations. This has been true not only in cases of decontrolled drugs but also in cases of drugs under price control. Primarily it is in this area of enforcement of the drug policy where the previous governments have failed. Therefore, the concern of the new government should be implementation of the drug policy and not its total redrafting.

In the case of sick public sector drug companies, the government has failed miserably to find a solution to this lingering issue. Both the leading PSUs namely HAL and IDPL have been sick for more than 15 years and have been referred to BIFR. Neither any serious attempt has been made by the successive central governments to sell off these units to the private players nor to revive them. In the case of IDPL, revival is going to be extremely difficult with most of its plant and machinery turning to be total junk. It will take hundreds of crores of rupees to reestablish it as a modern pharmaceutical unit at today's costs. This is not the time for the government to enter into drug manufacturing business. The only option it should exercise is to sell off this property at the earliest. But, HAL under the current management is showing signs of revival with generation of operating profits during last two years. The government should support such management initiatives of PSUs and allow it to run as a total commercial establishment. The overall policy of the government towards existing PSUs should be to encourage enterprising managements and sell off the unviable ones.