Last Updated on August 17, 2021 by The Health Master
The Central Government has removed the provision in the Drugs (Prices Control) Order, 2013 (DPCO), which mandated a price revision can be initiated on drugs on the basis of moving annual turnover (MAT) when the National List of Essential Medicines (NLEM) is revised by the ministry of health and family welfare.
With a fresh amendment now, the clause only says that the revision could be carried out every five years from the date of fixing the ceiling price.
The Department of Pharmaceuticals (DoP) has issued a Gazette Notification to bring the Drugs (Prices Control) Third Amendment Order, 2021 into effect. With the Amendment, the clause (i) in the Paragraph 18 in the DPCO 2013 has been substituted with “(i) every five years from the date of fixing the ceiling price under this Order for formulation as specified under the Schedule-I”.
Paragraph 18 of the DPCO 2013 deals with revision of ceiling price on the basis of MAT, where it stipulates three conditions or clauses by which the revision of ceiling prices shall be carried out.
The Clause (i), prior to the fresh amendment, read as “as and when the National List of Essential Medicines is revised by the ministry of health and family welfare or five years from the date of fixing the ceiling price under this Order whichever is earlier.”
The other clauses according to the DPCO 2013, which may call for a revision of ceiling prices on MAT, include (ii) when the number of manufacturers of a scheduled formulation, having price of a scheduled formulation more than or equal to seventy five per cent of the ceiling price fixed and notified by the government, has decreased by twenty five per cent or more than the number of manufacturers as existing on the reference date, or (iii) when the number of manufacturers of a scheduled formulation, having prices of their scheduled formulation equal to or lower than twenty five per cent of the ceiling price fixed by the government, has increased by twenty five per cent or more than the number of manufacturers as existing on the reference date.
The reference date in these two clauses shall be for first revision of ceiling price May, 2012 and for subsequent revision the date of previous revision of the ceiling price.
With the new amendment in the offing, the DoP has Department of Pharmaceuticals (DoP), on July 19, 2021, has notified that it is granting one time exemption from revision of ceiling price under Paragraph 18 (i) of the DPCO, 2013, and to keep in abeyance the revision of ceiling prices after completion of five years term till NLEM 2021 is released by the ministry of health and family welfare.
The government has been working on the revised NLEM, to update it according to the changes taking place in the healthcare sector, with more focus on chronic ailments including cancer, diabetes, among others.