As API prices surge, the pharma industry is requesting the Government to bring in some time-bound amendments in the DPCO 2013. Sudhir Malhotra, President, Federation of Pharma Entrepreneurs (FOPE) said, “To prevent the shortage of essential medicines in the domestic market, we are requesting the DoP to consider our recommendations about relaxing the provision of para 13 (2) of the DPCO 2013. So, all those manufacturers who are selling essential medicines below the ceiling prices can also follow the ceiling price and not have to discontinue the product.”
Ketan Patel, Chairman and Managing Director, Troikaa Pharmaceuticals explained, “For any product, when the price of the API used in it rises, the cost increases while the profit margin decreases. As per DPCO 2013, a limited increase in the MRP is permitted on an annual basis. If this increase of MRP does not absorb the increased cost of the API, the manufacturer suffers. The government must develop a mechanism to ensure that the profit margins, which are already low, are not further eroded.”
He continued, “This is even more relevant in the case of low-value products where the unit price is below Rs 4. The profits margin is in paise and that gets further eroded. This justifies the demand of the industry to remove drugs with low unit price, out of price control.”
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In its representation to the DoP, the associations have also suggested that a provision of price fixation of the new drug is added to clause 6 of para 15 of DPCO 2013. As per the Para 15 (2) of DPCO 2013, every manufacturer of the new drug needs to file for price approval application in Form 1. And, Para 15 (6) prohibits from selling any new drug at a price higher than price already fixed by the Government.
Harish Jain, Secretary, Karnataka Drugs and Pharmaceutical Manufacturers Association emphasised, “The price of a new drug as defined under DPCO is already fixed by the Government, then there is no need for every manufacturer to approach the NPPA with Form 1 application. As long as the manufacturer sells at a price equal to or lower than the price so fixed, it is deemed to be complying with the law. However, there is a lot of confusion amongst regulators as well as industry, hence a clarification from the NPPA will go a long way in ease of doing business.”
The associations have requested the Government to take corrective actions immediately to help the industry overcome the challenge of surging prices of active pharmaceutical ingredients (APIs) and ensure continued supply of essential medicines in the country.
Patel also stated that the COVID 19 pandemic has shown the strengths of the Indian pharma industry. The government must have a pragmatic approach and allow the industry to protect its profits. This would enable manufacturers to plough them back into the business and provide cost-effective medicines to our country, will increasingly dominating the international markets.
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