The National Pharmaceutical Pricing Authority (NPPA) has issued guidelines for examination of cases of launch of 'New Drugs' by pharma companies without obtaining prior price approval as required under the DPCO 2013.

According to senior officials, the authority had earlier begun the process of  identification of new drugs launched by pharma companies on the basis of market data (Pharmatrac) without following the provisions contained in the DPCO 2013. During the course of examination of replies submitted by various companies, it has been observed by the NPPA that the companies have not submitted the requisite documents to support their contention.   

So, in order to bring clarity in the examination of cases of launch of new drugs "without prior price approvals" (WPA cases) and standardisation of documents to be submitted by the companies, the NPPA decided to follow a standard and uniform procedure in respect of cases of launch of new drugs without prior price approval.

Officials said that the WPA cases will be dropped and the company will be duly informed if the company produces evidence (licence issued by State Drugs Controller (SDC)/DCGI) and invoices and samples prior to 15th May 2013, certified by CA or CMA in support of the claim that the formulation was launched before the DPCO 2013 came into effect; if AIOCD-Pharmatrac data confirm that the formulation was launched prior to 15th May 2013; and if the company claims and produces sufficient evidence to support the claim that the formulation does not come under the definition of a "new drug" under paragraphs 2 (u) of the DPC0,2013, i.e., either the company is not an "existing manufacturer" of the scheduled formulation; or none of the components of the formulation is under Schedule I of the DPC0, 2013 as amended from time to time.

Officials further said that the WPA cases will be dropped if the company claims are duly supported with sufficient evidence i.e. samples and invoices that the formulation is a scheduled formulation and the ceiling price is complied therewith and followed in accordance with provisions of the DPCO, 2013; if the company's claim that the formulation was never manufactured/marketed by it is confirmed by AlOCD-Pharmatrac; and if the company has changed only the pack size and launched the new pack size at a price equal to or less than the pro rata price of the previous pack size, or the increase in pro rata price if any taken by the company is in conformity with the provisions of paragraphs 20 (1) of DPCO,2013.   

The company will be required to submit evidence (licence issued by SDC/DCGI, invoice and sample, duly certified by CA/CMA regarding the previous and the existing pack size of concerned formulation manufactured/ marketed by it. The company has launched the new brand having same composition as in earlier brand with a different brand name at the price equal to or less than that of the earlier brand, or the increase in price taken by the company is in conformity with the provisions of paragraph 20 (1) of DPCO 2013. The company will be required to submit evidence (licence issued by SDC/DCGI and invoice and sample, duly certified by CA/CMA regarding the previous and the existing brand of concerned formulation manufactured/ marketed by it.

Further, in cases where the brand has been procured/re-launched under a different name by another company post-DPCO 2013, keeping the same composition of the formulation concerned as in the earlier brand at the price equal to or less than that of the earlier brand, or the increase in price taken by the company is in conformity with the provisions of paragraph 20 (1) of DPCO 2013. The company will be required to submit evidence (licence issued by SDC/DCGI and invoice/sample, certified by CA/CMA regarding the previous and the existing brand manufactured/ marketed by it.

Officials said that any WPA case not coming under any of the above said categories will be referred for price fixation and, after fixing the price concerned companies shall be liable to deposit overcharged amount along with interest from the date of overcharge, in addition to penalty, as per provisions of paragraph 15 of the DPCO, 2013.