If the average of 3 top-selling brands is the benchmark, then all drugs will cost more.
The government’s plan to increase the number of medicines under price control with an intention to make them affordable could instead end up hurting patients.
The draft National Pharmaceuticals Pricing Policy, circulated in October and currently under intense debate, aims to increase the number of drugs under control from 74 to 348. At first glance, the policy seems to benefit patients, but a closer look shows it could have a negative impact. Experts say that under the policy, the average of the three top-selling medicine brands will be taken as a benchmark for price fixation.
Anant Phadke, co-convenor, Jan Arogya Abhiyan, a health sector NGO, said the methodology used is faulty, as the three top-selling brands in any category are also the costliest. “This is because pharmaceuticals is the only category where the buying decision is made by doctors, who, in all likelihood, can prescribe costlier brands on account of the kickbacks and gifts they receive,” said Phadke.
Thus the average of the three top (or costliest) brands would be more than the current prices of other moderately priced brands, whose manufacturers would then be enticed to hike their prices too.
For example, if the average price of the three top-selling brands of the medicine for hypertension amlodipine comes to Rs50 for a strip of 10, then the company currently selling this medicine for Rs21 for a strip of 10 will be free to hike the price to Rs50.
“Why is the government planning to take the average of just the three top-selling brands? Why not 10 or 12 brands to get a more realistic picture?” asked Phadke.
Or even the average of the three least expensive brands, instead of the three costliest ones, is a better idea, said Gopal Dabade, co-convenor of All India Drug Action Network.
“This policy is an attempt to hoodwink the public into believing that with more drugs under regulation, prices will fall.”
Moreover, under the draft policy, all medicines sold for Rs3 or less per unit (tablet or capsule) will be exempted from price control, a step which will encourage manufacturers to hike prices per unit to Rs3 (as beyond this limit, the drug will attract regulation).
For example, if a manufacturer sells a tablet of paracetamol (used for pain/fever) for Re1, he would be encouraged to hike the price up to Rs3 without inviting any government scrutiny. This would thereby hike the price of a strip of 10 tablets to Rs30 from Rs10.
CM Gulhati, editor of MIMS India, a reference journal for medical practitioners, said that at the moment, one out of every three medicines sold in India is priced below Rs3 per unit. “The exemption from regulation given to drugs priced up to Rs3 per unit is irrational.”
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