The draft Pharmaceutical Policy proposed by the Department of Pharmaceuticals (DoP), if accepted, would significantly contribute to furthering Prime Minister's key initiatives-- ease of doing business in the pharmaceutical sector and Make in India programme.

For ensuring accessibility and affordability of drugs, ease of doing business and more coordinated synergies, all the regulators/commissions pertaining to pharmaceutical industries/sector will be brought within the ambit of one department.

The policy will enable government to take decision on drugs to be included in price control and NPPA will have to introduce the price cap of selected medicines; enforce those price caps; and ensure that the drugs are available in the market in adequate quantities.

DPCO will be reoriented to move from price-control to monitoring of drug prices, their availability and accessibility. The Schedule I of DPCO shall contain only the medicine’s name in the NLEM without referring to their strength and dosage forms. All strengths and dosage forms of that medicine shall be liable for price cap. This will make some entries in DPCO related to ‘new drug’ redundant. DPCO will include only ‘off-patent’ medicines in its schedule. ‘In-Patent’ medicines will not be subjected to price ceiling by NPPA. Paragraph 16 of DPCO shall be amended to clarify that any change in the WPI shall be reflected by adjusting the ceiling price in accordance with the change in WPI. Individual brands will thereafter adjust to the thus revised ceiling price. The revised price ceilings should be effective immediately by means of bar- coding. Instead of an unrealistic 60 day time frame for deciding the price ceilings, flexibility should be provided to NPPA to complete its job.

The country's heavy reliance on imported APIs has been a major concern. To address this, the proposed pharma policy has encouraged end to end indigenous drug manufacturing including that of APIs and their precursor intermediates.

For this, it is proposed that the formulations produced from indigenously produced API and its intermediates (end to end indigenous production) be given preference in government procurements. Such formulations be taken out of price control for 5 years and the price control be linked to the indigenous content of the formulations. All APIs which can be indigenously manufactured should be imported at peak customs duty.

The structure of registration fee for import and manufacture along with the provisions of audit of foreign plants would be rationalised to match international standards being followed by the regulators of the larger pharmaceuticals producing countries, the draft says.

Creating eco-system for setting up mega bulk drug parks through public private partnership mode; making bio-availability and bio-equivalence tests (BA/BE Tests) mandatory for all drug manufacturing permissions, and their renewal; ensuring to get GMP and GLP adopted by all manufacturing units; three months' time for approval of the central or state drug regulator; encouraging sale of single ingredient generic drugs by their salt name instead of brand name, promoting e-prescription, abolition of loan licensing, regulation for marketing practices, encouraging e-pharmacy; skilling programme for pharmacists; and strengthening of existing NIPERs are some of key features of draft Pharmaceutical Policy.

For patented drugs and fixed dose combination (FDCs) drugs the brand names may be used. However here, the principle of ‘one company – one drug – one brand name – one price’ would be implemented.

It also focussed on curbing unreasonable trade margins and bonus offers by various stockists, distributors and retailers. The level of trade margins will be prescribed to create a level playing field for the industry and to bring down the prices. Institutions receiving supplies directly from manufacturers/distributors or retailers will also be covered under the trade margin reforms.

There is no authentic database on pharmaceutical sector. A database will be created by the Department of Pharmaceuticals along with the Drug Control General of India (DCGI) on manufacturer wise, brand wise products and product wise, brand wise manufacturers.

As far as FDI in brownfield pharmaceutical companies is concerned, the FDI approvals would be subject to continuance of (i) manufacturing of NLEM drugs by the entity in which the FDI is being made; (ii) expenditure on R&D; and (iii) transfer of technology. At present there is no mechanism or system to monitor the post-acquisition (FDI) activities of the company. A system would be developed to monitor the adherence to these conditions.

To further encourage the R&D agenda the government would allow a concessional rate of customs duty of 0 to 5% on import of specified goods and services required for R&D in pharmaceutical industry. All Novel Drug Delivery Systems should be considered as ‘new drugs’, unless certified otherwise by the licensing authority. This will also encourage innovations.