The Indian government has announced plans to exercise stricter control over drug pricing in its domestic pharmaceutical market. Based on the proposed policy, at least 400 essential drugs will come under the fold of the National List of Essential Medicines (NLEM), thereby increasing the government’s current control of 20% to approximately 70%. The new pricing method is meant to replace the current Drug Price Policy Control (DPCO) 95, which stipulates that drugs recording company turnover of Rs1 Cr to Rs4 Cr (1 Crore = 10,000,000 million rupees), under various criteria, and products that held market share above a 50% in the category, are brought under price control.
Under the system, 74 bulk drugs and 1577 of their formulations have come under government purview as a result. Industry players and bodies such as the World Health Organization (WHO) are not in favor of the proposed drug policy. WHO representatives commented in a statement that the government’s proposed method of drawing drug data has failed to “take into account of discounts, rebates and bundling deals.” The data collection has also failed to provide pricing transparency and led to national abnormalities whereby high volume drugs are priced higher in India compared with neighboring countries, such as Sri Lanka.