The proposal to include all 354 drugs that figure in the National List of Essential Medicines (NLEM) under the scope of price control may cause a delay in the approval of the 'National Pharmaceutical Policy 2006' at the highest level. Following the footsteps of several ministries and departments, the Prime Minister's Office (PMO) is also known to have expressed displeasure over the plans for higher price control band.

In a recent directive, the PMO has asked Chemicals Ministry to examine the price variation that has happened in the case of NLEM drugs during the last three years. The idea would be to analyze if there has been any increase in the prices of these drugs during the period.

The PMO has also asked the ministry to prepare a separate cabinet note explaining how the issue of price control can be dealt with without increasing the span of control. The PMO feels that the current proposal should be reviewed to ensure that the list of price controlled drugs remains as short as possible. It has observed that adopting the entire NLEM as the list of drugs to be brought under price regulation is clearly inappropriate.

The view of the Planning Commission also echoes the same feelings. The Planning Commission has in fact gone a step ahead to suggest that the government should seek legal opinion to ascertain whether the Supreme Court really intended to bring all 354 NLEM drugs under price control while giving its verdict three years ago. The Commission views that increase in price control may prove counter-productive as it could discourage new investment and limit competition. It also felt that by doing so, the government would be going back from its current economic policy, which had led to the growth of Indian pharmaceutical industry.

The draft National Pharmaceutical Policy, 2006 seeks to strengthen the Drug Regulatory System and the patent office. It attempts to include, in addition to the existing 74 drugs and their formulations, the 354 drugs with specified strength as mentioned in the National List of Essential Medicines (NLEM), 2003 in the draft Pharmaceutical Policy. Apart from the cost plus method, other systems of price control like negotiated prices, differential prices, reference prices and bulk purchase price have also been proposed.