Pharma firms go to court over new price controls
According to figures from AIOCD Pharmasoftech, out of the total Indian pharmaceutical market of Rs.75,690 crore, scheduled products under Price Control amount to Rs.9,746 crore or 13 per cent.
Major Indian pharmaceutical companies have filed a petition in the High Court in Mumbai protesting the price cuts ordered by the National Pharmaceutical Pricing Authority (NPPA) a fortnight back, which they feel would be detrimental to industry interests.
The Indian Pharmaceutical Alliance (IPA), whose members include leading Indian pharmaceutical manufacturers such as Sun Pharmaceuticals, Lupin, Cadila Healthcare, and Dr. Reddy’s Laboratories, filed the petition which comes up for hearing next week.
The NPPA had invoked Paragraph 19 of the Drug Price Control Order 2013 under which it can cut the prices of medicines under ‘extraordinary circumstances.’
D. G. Shah, Secretary-General, IPA, said the petition was against the jurisdiction of the pricing regulator to determine the essentiality of drugs and the erroneous interpretation of Para 19.
There had been no extraordinary circumstances that have arisen since the promulgation of the DPCO 2013 for paragraph 19 to be invoked, he added. “Inter-brand differences are not ‘extraordinary’ by any means nor are they an indication of market failure,” IPA said in a statement.
According to figures from AIOCD Pharmasoftech, out of the total Indian pharmaceutical market of Rs.75,690 crore, scheduled products under Price Control amount to Rs.9,746 crore or 13 per cent. Non-scheduled products, now brought under price control, amount to Rs.5,484 crore or 7 per cent of the market, bringing total products under price control to 20 per cent of the market at Rs.15,210 crore. Thus, the span of control has increased by almost 50 per cent from 13 per cent to 20 per cent of market.
The move by the NPPA to bring 108 more formulations under price control was no doubt aimed at bringing more drugs within the reach of the common man, but it has drawn the ire of pharmaceutical companies.
It fixed prices of the formulations in two therapeutic segments, cardiovascular and anti-diabetic, extending price control to non-schedule drugs and affecting cuts of up to 35 per cent in the price of some drugs. Eight segments totally had been identified including tuberculosis, malaria, oncology, asthma, vaccines and anti-retroviral drugs.
