The Planning Commission is unlikely to grant a huge rise in the outlay for the pharmaceutical sector in the next Plan period (2007-2012), but is in favour of the industry on the contentious issue of monitoring vis-à-vis control on the prices of essential medicines.

The Planning Commission meeting held on Friday, which is understood to have opposed the stand by the Chemicals Ministry to introduce a blanket price control mechanism on the NLEM, as vociferously argued by Chemicals Minister Ram Vilas Paswan.

The Panel, which accepted the report of the Working Group on Drugs and Pharmaceuticals, is also unlikely to afford a heavy increase in the outlay. The report has recommended Rs 3275 crore for the next Plan.

The meeting also saw sharp objections from the industry representatives and some of the members including the chairman with regard to the NLEM and giving medicines to those below the poverty line at affordable rates, it is learnt.

While putting the onus on the Ministry to ensure essential medicines at affordable rates, the commission is of the view that the growing pharma industry must be put on growth-oriented track.

To some extent, the panel favoured the industry, though did not sound fully pro-industry. Price monitoring was felt as a better option, as repeatedly pushed by the Commerce Ministry and sternly by the industry, it is learnt.

The Commission, which discussed the recommendations of the working group, will have separate meeting with the Finance Ministry officials to fix the Plan outlay for the pharma sector before presenting it for approval before the NDC.

The 24-member working group headed by Secretary, Department of Chemicals and Petrochemicals has called for drastic changes in the regulatory mechanism and mooted several steps to consolidate the Indian pharma industry in the face of global competition.

Besides suggestions to create a Central Drugs Authority and revamping of the National Pharmaceutical Pricing Authority, the report also proposed formation of pharma parks, introduction of pharma export promotion scheme, and setting up of NIPER like institutions, among other measures.

The Plan panel will take final decision soon on the proposals like earmarking Rs 1250 crores for the establishment of 25 pharma parks across the country. It also will consider the proposal for Rs 50 crore for the infrastructure development of separate parks for formulations and bulk drugs.

Another key recommendation, submitted before the Panel for finalization, is creation of five NIPER (National Institute of Pharmaceutical Education and Research)-like establishments, to strengthen the human resource development aspect in the sector. An amount of Rs 750 crores (Rs 150 each) was sought in this regard.

The Panel will also look into the proposed allotment of Rs 560 crore to provide interest subsidy on loans for the small-scale pharmaceutical sector for complying with the new GMP norms.