Industry & Economy
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Pharmaceuticals
Call for deregulation on drug pricing
Our Bureau
New Delhi, July 2 In line with the demands on the pharmaceutical industry, the Economic Survey has called for a complete deregulation on drug pricing. It has suggested that drug price control should be limited to essential drugs, in which there are less than five producers, while all other should be deregulated.
The proposal is contrary to the pharmaceutical policy drafted by the previous UPA Government, which had included laws to increase price control to more drugs. At present about 74 medicines are under price control, monitored by the National Pharmaceutical Pricing Authority.
The new policy had suggested increasing the control to 354 drugs on grounds of making medicines affordable. But the proposal has not been made into a law, given the huge opposition from the industry players. Now the recommendation of the Economic Survey gives a new direction to drug pricing.
Right direction
When contacted Mr D.G. Shah, Secretary General, Indian Pharmaceutical Alliance said the Economic Survey’s suggestion was in the right direction.
“This is what the industry has been demanding for more than two years. Market forces should determine drug prices and there is enough competition in the market today that will prevent any undue increase in drug prices. By deregulating the price, the Economic Survey has given the right direction. This will benefit the consumers and the manufacturers. One only hopes that this is made into a policy.”
Mr Shah said that price controls stifle drug development and entry of new manufacturers. “You can see what is happening in medicines where the Government controls prices. There are no new manufacturers producing these drugs. This will impact consumers too.”
Expanding investments
The survey pointed out that the Indian pharma industry has grown from a Rs 1,500-crore turnover in 1980 to over Rs 78,000 crore in 2008, with about 10 per cent share volume of global production.
“Investments in pharma sector are now expanding into areas of innovative R&D focused outsourcing opportunities like clinical trials, data management services, pharmaceutical informatics, lead discovery and optimisation.
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