After a decade of its proposal, DoP still struggling on pricing of patented drugs

Mumbai, November, 2016

Almost a decade has passed since the proposal was first mooted, but the Department of Pharmaceuticals (DoP) could not yet finsalise a national policy on pricing of patented drugs before they are imported into the country, thanks to the pulls and pressures being exerted by different stakeholders in the industry.

The issue of pricing of patented drugs dates back to early 2007 when the DoP initiated steps to frame a method to make sure that the drugs patented abroad remain affordable as and when the multinational companies launch them in India. The DoP had held a series of meetings of the concerned parties and sought proposals from the industry associations to create a methodology for price negotiation of drugs and medical devices patented abroad and are marketed by multinational companies in India.

The government then formed a panel to look into the matter. The panel was asked to suggest a method of reference pricing, price negotiations or differential pricing, etc. that could be applied for pricing of patented medicines and medical devices before their marketing approval in India. After several years of dilly-dallying on the issue, the panel submitted its report to the DoP in February, 2013. In its report, the committee had recommended a formula on price negotiation of patented drugs, linking it to the per capita income in the country. It also suggested setting up a committee headed by the chairman of the NPPA to decide the price of patented drugs before they are marketed for use in India.

Immediately after the submission of the report by the panel, the DoP asked the stakeholders and experts to send their comments and suggestions to take a final view on the report. But, as it received diverse opinions from different stakeholders, the DoP then decided to constitute an inter-ministerial committee to look into the issues and suggest ways and means to fix the prices of patented drugs in the country.

So, an inter-ministerial committee of joint secretaries of different ministries was formed by the DoP in February 2014 to look into the issues and suggest ways and means to fix the prices of patented drugs in the country. The new inter-ministerial committee of joint secretaries was constituted under the chairmanship of Shambhu Kallolikar, then joint secretary (DoP). Other members of the committee are joint secretary, department of industrial policy and promotion (DIPP); joint secretary, ministry of health and family welfare; and member secretary national pharmaceutical pricing authority (NPPA). Director (DoP) BK Singh was the convener of the new committee.

Since then, the committee has held several rounds of deliberations and negotiations with the stakeholders and others. But, it is yet to take a final call on the issue which has been pending the department for almost a decade now. Pharmabiz