The Hindu Business Line : Separate pricing models for drug categories likely

For starters, it is planning to create a separate hospitals supply medicine list that would not be subject to any price control. According to officials in the Chemicals and Fertilisers Ministry, "About 39 drugs from the 354 drugs in the National List of Essential Medicines would fall in this category. Since hospitals make bulk purchases through a tendering process, they are normally able to source drugs at cheaper rates. Hence, we do not feel the need to regulate prices of these medicines."

A second category of drugs would be chosen that would come under the cost-based price control. Currently, the National Pharmaceutical Pricing Authority (NPPA) monitors the 74 bulk drugs, but officials maintained that in the new regime this number could be brought down.

For the remaining medicines in the essential drug list, the Government is planning to cap the ceiling prices based on the weighted average of the maximum retail price (MRP) of the top three brands in both volume terms and value terms.

In line with the National Common Minimum Programme of the United Progressive alliance (UPA), the Government also hopes to ensure the availability and affordability of drugs used for treatment of diseases such as cancer and HIV/AIDS. "While one of the option is to make it available at discounted rates at hospital pharmacies, we feel that public-private partnership is the way forward. Currently there are over 40 drugs available for these diseases and the high cost is a concern," said sources.

Besides this, the Chemicals and Fertilisers Ministry has also indicated pre-negotiation of patented drugs. In the post-product patent regime, the Government is planning to fix prices of patented drugs before granting marketing approval to the drug.

"Since the patent holder will be in a monopoly position, this is to ensure that the company does not charge an exorbitantly high price for its drug. The Government will fix the prices after taking into account the international prices of the drug," the officials added.

The Chemicals and Fertilisers Ministry is working on a new pharma policy after the Supreme Court asked the Government to ensure availability and affordability of essential drugs. Two committees - one under Planning Commission Advisor, Dr Pronab Sen, and another under a Joint Secretary of the Ministry - were sent up to look at various options to bring down the prices of drugs including controlling trade margins. Officials maintained that the policy will be finalised shortly and be taken to the Cabinet. Besides this, it has also recommended tax incentives and a one per cent health cess to ensure access to healthcare.

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