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NPPA turns to insulin market to reign in soaring prices
Joseph Alexander, New Delhi | Monday, June 2, 2008, 08:00 Hrs  [IST]

The National Pharmaceutical Pricing Authority (NPPA) has launched an exercise to reign in the domestic and international insulin manufacturers and marketers to impose a possible ceiling on the prices of this life-saving drug relied upon by over 30 million diabetics in the country.

After bridling the scheduled sector tightly and stepping into the non-scheduled segment by fixing prices of many drugs to make them affordable to the common man, the national pharma price regulator is learnt to have started consultations with different groups, associations and insulin manufacturers to get a first-hand view of the pricing. Some of the companies have already made presentations to the NPPA to explain their position and justifications to the existing prices.

The NPPA would take a final decision on fixing the prices of the insulin, both injections and cartridges, after hearing the views of major players and if the prices were found to be high in the cost study. However, the authority has decided to have a close look at the Rs 350-crore domestic insulin market and treat it as its next focussed segment of action, as India is turning into the diabetes capital of the world, sources indicated.

As the domestic market is controlled by both multinational and indigenous players, it is going to be tough for the authority to fix the prices after allowing them reasonable margins. In the case of domestic producers, the agency will be able to get the correct figures on cost of production to fix the retail price while it will be tough to do the same with the imported brands depending on their claims.

Denmark based multinational Novo Nordisk controls about 80 per cent of the domestic insulin market while the rest of the market is shared by Eli Lilly, Biocon, Wockhardt, Cadila and US Vitamins. Thus almost 90 per cent of the market is in the hands of the multinationals. With the rise in the number of diabetics in the country, the insulin market is also growing by 20-25 per cent, according to estimates. A multi-shot insulin injection's price varies from Rs 65 to Rs 147 per 10 ml vial (40 iu), with MNC brands at the upper end.

The insulin players, who are looking to earn quick bucks with newer products from the rapidly increasing market, have run into some fear of losing their high margins following some reports about the intention of the NPPA which has taken note of the alleged lack of transfer pricing. Hence some of the players themselves came forward to present their views to the agency.

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