The implementation of the new DPCO, 2013 commenced six months ago with National Pharmaceutical Pricing Authority notifying new prices of formulations of 348 drugs under price control. But its enforcement has been faulty from the very beginning and now it is in a mess. First of all, the manufacturers were given just 45 days time to withdraw old stocks of drugs and implement the new rates. Any sane bureaucrat should understand that it is just impossible to call back old stocks from 7 lakh retail chemists and reprint the new prices in a country as vast as India with its pathetic infrastructure. The issue was repeatedly represented by the industry and trade soon after the order was issued but the officials refused to make any changes to the order. The patient community was the victims of this unreasonable stand of the bureaucrats as the chemists were unable to get fresh stocks of several essential drugs with new prices from the manufacturers on time. The process of price revision is not yet completed and prices of 400 formulation packs out of a total of 650 have been revised so far. NPPA admitted  that more than 50 formulation prices out of 650 cannot be fixed  as these products are not in market for some time. Many of these price fixing orders are being challenged by pharma companies on different grounds. While this issue remains unresolved, the retail trade resorted not to stock products of several companies on the ground that trade margins of controlled medicines have been reduced in the new DPCO with a sharp rise in the number of controlled drugs to 348 from 74. Their profitability certainly stands reduced with lower margins and increase in number of controlled drugs. A few large companies recently started offering old margins to the traders just to protect their sales. But majority of the pharma companies are still offering newly fixed trade margins. Because of that retail trade is not keeping medicines of those companies that are refusing to hike the margins. DoP has not acted to end this confusion in the market and left the matter to the industry and trade to decide.

Be that as it may, a number of pharma companies have also started circumventing the provisions of DPCO by changing the composition and strength of formulations to evade price control. The companies have been indulging in this practice when DPCO, 1995 was in force too. The Parliamentary Standing Committee attached to the Chemicals Ministry has taken this matter seriously and asked DoP to identify such companies and to take up the matter with the ministry of health and family welfare for action. Now, the Department has been claiming that the prices of many drugs will come down drastically with the implementation of DPCO, 2013. This is not happening at all and on the contrary prices of many drugs have already gone up during the last six months. And it is unlikely that drug prices may come down as claimed by the officials because there are many high priced products in each therapeutic category and a simple average can only push up prices in most cases. A petition, filed by some patient groups in the Supreme Court before the new DPCO was notified, had appealed that the drug price fixing should be on the basis of cost plus formula. The Supreme Court had also observed in one of the past hearings that price fixing on the basis of average market price of a formulation in the new drug policy might lead to an increase in prices of life saving drugs and therefore the government should continue with the cost based pricing as in the last policy. The Department has not taken note of this observation. The drug pricing policy in a poor country like India should be mass oriented ensuring fair prices for essential drugs with its effective implementation all over the country. But the government seems to have failed in all these fronts with the new DPCO as in the past.