AICDF urges DoP to allow wholesale and retail trade margins of 12 and 25 percent for branded drugs
Mumbai, October , 2017:
The All India Chemists and Distributors Federation (AICDF) has urged Department of Pharmaceuticals (DoP) to allow wholesale and retail trade margin of 12% and 25% for branded drugs and 15% and 35% for generic drugs.
“Our demand for the said trade margin is no way unjustified or illogical as the cost of living has gone up many folds over last three decades. Trade margin is the basic impetus for traders to ensure their survival in compliance with justified service towards the ailing community adjusting properly with the socio-economic situation of the country, said Kailash Gupta”, president of AICDF.
The appeal was made by AICDF in response to a letter issued by DoP on September 29, 2017 wherein it sought suggestions from stakeholders to implement recommendation of Sudhansh Pant committee on trade margin.
A panel under the chairmanship of Pant, joint secretary of DoP was set up in 2015 to look into trade margin on pharmaceutical products as margin on some of life saving drugs and medical devices increased to 4,000 per cent violating the provisions of the Drug Price Control Order, 2013.
The committee submitted report in January 2016 prescribing a gradation system for capping the margins. It suggested a 35 per cent cap on medicines with MRP of Rs.50 and above, and 50 per cent cap on medicines with MRP between Rs.2–20. All medicines with MRP below Rs.2 should be exempted from a cap on trade margin. The trade margin cap is proposed to be implemented on all drugs including generics, branded, scheduled and non-scheduled drugs.
The AICDF opposed recommendations of the committee and demanded wholesale and retail trade margin of 12% and 25% for branded drugs and 15% and 35% for generic drugs where manufacturers have neither promotional nor marketing activities.
It says DoP and NPPA have not done enough to bring down the prices of drugs and act against the manufacturers involved in overcharging thus belittling the government's move to make drugs affordable which is the main objective behind the trade margin cap. So far 20% molecules are under price control. A total of 680 medicines are currently under the National List of Essential Medicines (NLEM) and is in the scheduled category of DPCO, 2013. Till now NPPA has fixed the ceiling prices of 530 of these medicines.
“There are a huge variations in prices of drugs made of same molecule. We have appealed to the government to ensure one rate for one molecule with different brands in the country in the interest of consumers,” Gupta said.
If the government is keen to make pharmaceutical products affordable for people, it should take steps to curb the margin of hospitals on drugs and consumables running more than 70% making healthcare costly, he said.
“During a survey, AICDF has found that the concept of ‘fair price shop’ within the premises of government hospitals and institutions to provide ‘medicines at more than 70% discount’ is not a blessing but the poor patients are paying more than the ‘reasonable’ or ‘justified’ rates. Taking serious note of this, we have demanded ‘fixed MRP and not the discounted rate in the interest of patients”, he concluded.