Setback For India Drug Price Watchdog Plan

30 January 1995

Proposals by India's Ministry of Chemicals and Petrochemicals to monitor pharmaceutical pricing following the notification this month of the new Drug Prices Control Order (Marketletter January 16) have received a setback. This is due to the Finance Ministry expressing its opposition to the Chemicals Ministry's plan to establish a new authority of experts, whose responsibility would be to review pharmaceutical prices on an annual basis.

The new body, to be named the National Pharmaceutical Pricing Authority, would also be expected to assist in the implementation of the new DPCO. Announcing the modifications to the 1986 drug policy in September 1994, Ministry officials had stated that in order to achieve uniformity in prices of widely-used drug products, ceiling prices should be established for commonly-available standard pack sizes of price-controlled formulations, and that these ceiling prices should be binding on all manufacturers, including the smaller enterprises.

Details Of the New DPCO The new DPCO sets price controls on 76 medicines which account for almost 50% of the national retail pharmaceutical market. Previously, 143 products were under price control. 83 items which previously carried price restrictions have also now been decontrolled. Products for which there is considered to be adequate market competition are not under price control, and according to the Marketletter's New Delhi correspondent, at least five bulk drug producers and 10 formulators within the retail market have been kept out of price control.

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