NEW DELHI: A parliamentary panel has asked the government to push for tighter regulation of non-scheduled medicines, noting they account for 82% of India’s pharma market by value and largely remain outside direct price control of the National Pharmaceutical Pricing Authority (NPPA).
In its action-taken report, the standing committee on chemicals and fertilisers rejected the government’s replies on 7 of its 11 recommendations and reiterated the need for comprehensive reforms to the Drugs (Prices Control) Order (DPCO).
The report noted that around 4% of the non-scheduled market has weighted average mark-ups exceeding 100% over the price charged to distributors, while 87% of the market has mark-ups of up to 45%.
“The apparent lack of any control over trade margins, especially in the case of non-scheduled drugs, leaves the door open for widespread profiteering at the cost of patients,” the panel observed, asking the department of pharmaceuticals (DoP) to revisit the current mechanism that merely restricts annual MRP (maximum retail price) increases to 10% for such medicines.
“Although they are technically restricted from increasing the MRP by more than 10% annually, the absence of initial price fixation renders this control largely meaningless,” it added.
The report also questioned the legal architecture of the DPCO, arguing that the regulation, in its current form, is structurally inadequate to curb pricing malpractices in India’s pharma sector. “While the DPCO empowers the NPPA to regulate medicines included in the NLEM, it fails to extend this regulatory authority to unscheduled drugs. This regulatory gap allows manufacturers to launch non-scheduled formulations, both branded and generic, at arbitrary points,” the panel said.
The committee has also sought “closer regulatory scrutiny” of non-scheduled fixed-dose combination (FDC) medicines, stating these drugs account for a substantial share of prescriptions but remain outside effective price regulation despite concerns over irrational combinations.
The panel also expressed dissatisfaction over the government’s slow progress in institutionalising the Trade Margin Rationalisation (TMR) framework, an approach that has so far been deployed only through extraordinary powers under Paragraph 19 of the DPCO for anti-cancer medicines and select medical devices.
Further, the committee has sought details from the government of non-scheduled drugs carrying mark-ups exceeding 100%. “The committee feels that relying only on exceptional power clauses may not be sufficient to protect public interest in the long term and a permanent, transparent system must be put in place at the earliest to regularly monitor MRPs and trade margins for life-saving drugs like anti-cancer medicines,” as per the report.
Source: The Financial Express
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