The 16-member draft drug policy review committee constituted by the Ministry of Chemicals and Fertilizers to iron out the key issues related to the proposed Pharmaceutical Policy 2006, is likely to suggest a compromise on the issue of bringing all NLEM drugs under price control, it is learnt.

The report is likely to take into consideration the industry sentiments related to bringing all NLEM drugs under price control and may suggest long term and short term strategies to bring down the prices of all essential medicines. While the short-term strategies are to appease the determined efforts of the Union Chemicals Minister Ram Vilas Paswan and to see that the prices are reduced, the long-term suggestions would include a combination of factors that would ensure availability and affordability of drugs.

The industry representatives, who form majority in the 16 member committee, has clearly and repeatedly voiced that any unilateral capping of drug prices could affect drug availability, as the industry would refrain from manufacturing drugs that are unprofitable to them or are with lean margins.

An important suggestion before the Committee is to revamp the National Pharmaceutical Pricing Authority (NPPA) in the lines of the Telecom Regulatory Authority of India (TRAI), which is armed with powers to monitor and control the telecom sector. Apparently, this suggestion is another industry tactic to escape price control planned by the Government. This may not be practical as more than half a lakh drug brands are floating in the market and is impossible to track the prices of all medicines on a regular basis, sources point out.


Further, the industry has forcefully conveyed to the committee that two factors - exports and R&D investments, should be considered while fixing prices of drugs, instead of the current practice of considering only the manufacturing costs and marketing expenses. "Now Indian companies have to invest heavily in R&D and drug discovery has become a priority agenda for the industry. I am sure at least three-four Indian research companies are on the brink of coming out with India's first drug within a few years. These factors have to be considered by the Government while deciding the pricing issue", notes DG Shah, secretary general, Indian Pharmaceutical Alliance (IPA).

The industry has also conveyed to the Government that they are keen to supply drugs at subsidized prices to the public sector, provided the Government establishes an efficient drug procurement mechanism in all the States as part of the long term strategies. They cite that while the Chinese Government procures from the industry and supplies 80 per cent of the drug requirements in Chinese hospitals, the role of the Government in drug procurement is only 14 per cent in India.

The committee is slated to submit its recommendations by the end of this month.