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Price control

Price control of drugs

  • India puts 42 non-scheduled cancer drugs under price control

The government has decided to bring 42 non-scheduled anti-cancer drugs under price control, capping trade margin at 30 per cent.

The National Pharmaceutical Pricing Authority (NPPA) has invoked extraordinary powers in public interest, under Para 19 of the Drugs (Prices Control) Order, 2013 to bring 42 non-scheduled anti-cancer drugs under price control through trade margin rationalisation.

‘Invoking paragraph 19 of DPCO, 2013, the government hereby puts a cap on trade margin of 30 per cent and directs manufacturers to fix their retail price based on price at first point of sale of product… of the non-scheduled formulations containing any of the 42 drugs,’ the Department of Pharmaceuticals (DOP) said in a notification.

As per data available with NPPA, the MRP for 105 brands will be reduced up to 85 per cent entailing minimum saving of Rs 105 crore to consumers, it added.

Currently, 57 anti-cancer drugs are under price control as scheduled formulations.

Now 42 non-scheduled anti-cancer medicines have been selected for price regulation by restricting trade margin on the selling price (MRP) up to 30 per cent, the notification said.

‘These would cover 72 formulations and 355 brands as per data available with NPPA. More data is being collected from hospitals and manufacturers to finalise the list,’ it added.

The drug manufacturers have been given seven days to recalculate the prices and inform the NPPA, state drug controllers, stockists and retailers, it said.

The revised prices shall come into effect from March, 8, it added.

The NPPA currently fixes prices of drugs placed in the National List of Essential Medicines (NLEM) under Schedule-I of the DPCO. So far, around 1000 drugs have been brought under price control under the initiative.

Non-scheduled drugs are allowed an increase of up to 10 per cent in prices every year, which is monitored by the NPPA.

What is an Essential Medicine?

  • According to World Health Organization (WHO), Essential medicines are the medicines that “satisfy the priority health care needs of the population”. People should have access to these medicines at all times in sufficient amounts. The prices should be at generally affordable levels.

What is National List of Essential Medicines (NLEM)?

  • NLEM is a list of medicines prepared by the Ministry of Health and Family Welfare based on essentiality and made part of the Drugs Price Control Orders (DPCO), 2013 (DPCO 2013) in the form of first Schedule of the DPCO 2013.
  • NLEM is the basis for the National Pharmaceutical Pricing Authority (NPPA), to revise the list of medicines that should come under government price control
  • The first National List of Essential Medicines (NLEM) of India was prepared and released in 1996. This list was subsequently revised in 2003, 2011 and 2015.

What is Drugs Price Control Orders (DPCO), 2013 (DPCO 2013)?

  • DPCO 2013 is an order issued by the Central Government having power under section 3 of the Essential Commodity Act, 1955 which enables it to fix the prices of essential bulk drugs and their formulations mentioned under the NLEM.
  • The formulations which are included in NLEM i.e. first Schedule of the DPCO 2013 are known as Scheduled Formulations.
  • Any person acting in contravention of the DPCO 2013 is punishable under section 7 of the Essential Commodities Act, 1955.

About National Pharmaceutical Pricing Authority (NPPA)


·         Established in: 1997.

·         Type of body: It has been set up as per executive order and thus not a statutory body.

·         Objectives: It is a government regulatory agency which performs the following functions

o   Controlling the prices of pharmaceutical drugs in India;

o   Enforce the Drugs Price Control Order (DPCO), 2013; and

o   Advising the Government of India in matters of drug policies and pricing.

·   Parent agency: Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers.

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