NPPA extends price cap on liquid Medical Oxygen and Oxygen inhalation

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Last Updated on December 31, 2021 by The Health Master

Download the notification: In the public interest, the National Pharmaceutical Pricing Authority (NPPA) has extended the period for price caps on liquid medical oxygen (LMO) and oxygen inhalation (medicinal gas) from the current December 31 to three more months, vide notification S.O. No. 5424(E) dt 28-12-2021.

The Authority said that the Department for Promotion of Industry and Internal Trade (DPIIT), Ministry of Commerce and Industry, through an Office Memorandum on December 23, 2021, recommended that the prices of the LMO and medicinal gas may further be extended to another three months beyond December 31, after which the issue may be reviewed by the Department again.

NPPA considered the matter in detail and decided that the revised price of LMO and medicinal gas fixed by the order on September 25, 2020, be further extended up to March 31, 2022, or until further order, whichever is earlier, in public interest. Earlier, the price was extended thrice, from March 2021 to September and later to December.

The NPPA in its order on September 9, 2020, observed that the demand for medical oxygen has gone up almost four times, from 750 MT per day to around 2,800 MT per day, due to C-19 pandemic. During the pandemic, around 50 percent of the total liquid oxygen production is being used for medical purposes, in comparison to around 15 per cent usage during the pre-C-19 period.

“It is therefore imperative to cap the price of LMO to ensure uninterrupted availability of medical oxygen through cylinders to hospitals and consumers,” it said. Medicinal gas is a scheduled formulation under the amended Schedule I of Drugs (Prices Control) Order [DPCO], 2013, and NPPA had notified its ceiling price as Rs 17.49 per cubic meter excluding Goods and Service Tax (GST) from March 25, 2020.

Looking at the C-19 situation and the consumption trends of medical oxygen in the country, the Union ministry of health and family welfare has delegated powers to NPPA to take steps to immediately regulate the availability and pricing of LMO and medical oxygen cylinders. An inter-ministerial committee constituted by the NPPA to monitor prices of APIs and formulations needed for C-19 also recommended capping the prices of these products.

The Authority, through the order, during the time fixed the ex-factory maximum price of LMO at Rs. 15.22 per cubic meter, excluding GST, and Rs. 25.71 for medicinal gas per cubic meter in cylinder, inclusive of inward transportation costs incurred for LMO up to the filler.

The manufacturers not complying with the price cap, shall be liable to deposit the overcharged amount along with interest thereon under the provisions of the DPCO, 2013 read with the Essential Commodities Act, 1955, said the order.

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