Even as the industry has more or less welcomed the new Cost Based Pricing (CBP) policy announced by the Department of Pharmaceuticals (DoP) as part of its National Pharmaceuticals Pricing Policy, this “never-heard-of-before methodology” of the DoP has come in for sharp criticism from the experts as they say that the policy will not serve the desired purpose of bringing down the prices of drugs.
Terming the new policy as inherently irrational, well-known health expert and Editor of the medical journal MIMS, Dr CM Gulhati has questioned the rather strange methodology used by the government. “Under this strange system, the weighted average price of three top selling branded medicines will be the benchmark for price fixation. Why top three brands only? Why not top 10 to get a more reasonable figure? Why not take into account the price of drugs sold under their generic names also? Why not the average price of three or more least expensive brands?,” he asks.
Dr Gulhati said that the government is patting itself on the back for having expanded the scope of the self-styled 'price control' from current 74 to 348 molecules listed under the National List of Essential Medicines (NLEN). The total number of molecules being used in India exceeds 1,000. Thus even the expanded list leaves out a huge number of drugs from any price control.
While the new policy can cover single ingredient formulations, there are many multi-ingredient products where there is just one brand. In such cases the manufacturers will be free to fix prices arbitrarily. Even when there are many identical multi-ingredient brands, a slight change in the composition will take them out of the price ceiling, he said.
Listing examples, experts said that while anti-hypertension drug enalapril will have a price cap, prices of all other widely used ACE inhibitors such as captopril, fosinopril, imidapril, lisinopril, perindopril, quinapril, ramipril and trandolapril will be free from any regulation. In the case of Angiotension II receptor blockers (ARBS), prices of all agents including losartan, candesartan, irbesartan, telmisartan, valsartan and olmesartan will not be regulated.
Among drugs used in asthma except for salbutamol and hardly used ipratropium, all other agents in high usage such as terbutaline, salmeterol, formeterol, bambuterol, theophylline, doxofylline, montelukast and zafirlukast will have no ceiling prices.
Pointing out another major anomaly in the new policy, experts said that the prices of nearly all oral anti-diabetic drugs will double or treble as the prices of medicines that are sold for Rs. 3 or less per unit ( tablet, capsule, ampoule) will not be regulated. For example, a strip of 10 tablets of ranitidine currently sold for Rs. 5.25 will be at liberty to hike the price to Rs. 30.
The worst part of the new policy is that it will not control the exorbitantly priced patented medicines of MNCs as the issue of pricing of patented drugs has been left to a committee which was constituted way back in 2006, Dr Gulhati said.
According to experts, the new policy suffers from the same drawbacks as that of the 1995 Drugs Price Control Order (DPCO). By not regulating the prices of all medicines in the same therapeutic category, the doors will remain wide open for manufacturers to migrate from regulated to non-regulated drugs.