Financial Daily from THE HINDU group of publications
Sunday, Nov 13, 2005
Financial Daily from THE HINDU group of publications Sunday, Nov 13, 2005 |
|
|
|
|
|
|
|
Home Page
-
Pharmaceuticals Industry & Economy - Pharmaceuticals Government - Policy Govt softens stand on generic drug prices — Control only for branded medicines Nithya Subramanian
New Delhi , Nov. 12 GENERIC pharmaceutical companies may have a reason to rejoice with the Government considering the option of keeping these medicines out of price control. In an attempt to promote generics, the Chemicals and Fertilisers Ministry is planning to bring under the price control regime only branded versions of the 314 medicines in the national essential drug list. The clause relating to de-branding of select drugs that have market dominance could also be dropped from the proposed new Pharma Policy. According to top Government sources, "We want to encourage the usage of generic drugs and therefore do not want to bring them under price control. Only those drugs that are sold as branded formulations will come under price control." Regarding de-branding of drugs, the source said that there is no clarity on when or why a particular drug should be de-branded. "This would ideally be a decision to be taken by the Health Ministry," he added. Earlier, the task force headed by Dr Pronab Sen, Principal Advisor, Planning Commission, said that certain prescription drugs would be de-branded while over-the-counter (OTC) medicines would be excluded, impacting less than one-two per cent of the total formulations available. However, industry had strongly objected to this stating that it was anti-competitive and unsafe. It could also lead to growth of spurious and counterfeit drugs. The Government hoped that by relaxing these two clauses, generic companies would continue to keep prices low. Besides this, the Government is also debating on whether to opt for a cost-based or maximum retail price (MRP)-based price control. Currently, the National Pharmaceutical Pricing Authority (NPPA) fixed prices of about 35 drugs based on cost of inputs. However, the Government is now considering the option of fixing prices of about 250-275 essential drugs by taking the weighted average of top three brands by value. The new pharmaceutical policy is also likely to prescribe ceilings on trade margins for drugs that are not under price control. In the case of branded medicines, the wholesale and retail margins could be fixed at 10 per cent and 20 per cent, while for un-branded or generic drugs, trade margin cap of 15 per cent and 35 per cent for wholesalers and retailers respectively is being considered. The Government had earlier found that companies were paying as much as 500-1000 per cent as margins to the trade. While, the Pronab Sen-headed Task Force was silent on the issue of trade margins, another committee headed by a Joint Secretary in the Chemicals and Fertilisers Ministry was looking into this.
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|