The Department of Pharmaceuticals (DoP) has directed the national drug price regulator the National Pharmaceutical Pricing Authority (NPPA) to desist from deciding the ceiling prices of schedule drugs on its own derived principles which are beyond the provisions of DPCO 2013.

The DoP's directive to the NPPA in this regard came during the examination of a review application filed by pharma major Sun Pharmaceutical Industries against price fixation of “Volitra AQ injection (diclofenac sodium injection 75 mg/ml)” by the NPPA through its order No. S.O. 2195(E) [corrected SO No.2194(E)] dated 23.06.2016.  

“Review application of the company is accepted and NPPA is directed to re-fix the price as per the provisions of DPCO 2013 within one month of this Order, rather than deciding the prices on its own derived principles which are beyond the provisions of DPCO 2013. The calculation sheets should also be put up in the public domain,” the DoP in its order said.

In the review application, the petitioner contended that they had provided the market data of diclofenac sodium injection 75 mg/ml of November 2015 & December 2015, i.e. data of 6 months prior to the date of filing of Form-I, as per para 9(4) of DPCO 2013.  They had requested the office of NPPA for providing them the working sheet/ calculation copy of retail price of Rs. 14.3 per ml through their letter dated 27.06.2016, and 18.07.2016, however they have not received any details so far.

In reply, the NPPA commented that it has fixed the retail price of Rs. 14.30/ml based on the Form-I application submitted by Nitin Lifesciences (Ltd.) (manufacturer) and Galpha Lab Ltd. (marketing company) for the same composition vide S.O. 1562(E) dated 27/04/2016, as per the Authority decision taken in 14th meeting of Authority held on 23/04/2014 that the price shall be valid for one year.    As per information available with M&E division (through IPDMS report), company has not submitted Form-V in respect of their formulation whose retail price was notified vide S.O. 2195(E) dated 23.6.2016. DoP is also requested to verify the same from the company before hearing.

During the personal hearing, the company representative submitted that they have applied for price approval in Form-I dated 06.05.2016 to NPPA for diclofenac sodium injection 75 mg/ml along with all the pre-requisite documents. Being existing manufacturer of diclofenac sodium injection 25mg/ml, Diclofenac sodium injection 75 mg/ml Injection is a new drug as per para 2(u) of DPCO 2013.
NPPA notified the Retail Price of 14.30 /ml via notification S.O. 2195(E) dated 23.06.2016. The company observed that the retail price of Rs. 14.30 /ml was not as per market data of November 2015, which is 6 months prior of date of application, as per para 9(4) of DPCO 2013.The company submitted representation to the office of NPPA for providing the calculation sheet in arriving at the retail price of Rs. 14.30/ml to understand the calculation. In reply, NPPA sent a letter to the company stating that the price notified is Rs. 14.3/ml, and they have to comply with this price.

During examination of the petition, the DoP noted that as per provision of para 5(1) read with para 9(4) of DPCO 2013 NPPA is required to consider the PTR of available drugs in the market, take simple average of all those who have more than 1 per cent market share and consider the new drug price as per the simple average formula contained in para 4(1) of DPCO 2013. NPPA has fixed the retail price of Rs. 14.30/ml based on the Form-I application submitted by Nitin Lifesciences (Ltd.) (manufacturer) and Galpha Lab Ltd. (marketing company) for the same composition vide S.O. 1562(E) dated 27/04/2016, based on the decision taken in 14th meeting of Authority held on 23/04/2014 that the price for formulations having same composition and strength shall be valid for one year. This decision is not in accordance with the provisions of DPCO, 2013.