Steps Taken by NPPA to Reduce Cancer Drug Prices

The NPPA's initiatives have resulted in a significant reduction in the ceiling prices of cancer drug listed under the NLEM for the years 2015 and 2022.

The Health Master

December 12, 2023

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NPPA National Pharmaceutical Pricing Authority — Picture: Pixabay

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Last Updated on October 2, 2024 by The Health Master

Cancer Drug

In recent years, the National Pharmaceutical Pricing Authority (NPPA) has played a pivotal role in regulating drug prices in India, particularly focusing on essential medicines like anti cancer drug.

The NPPA’s initiatives have resulted in a significant reduction in the ceiling prices of cancer drug listed under the National List of Essential Medicines (NLEM) for the years 2015 and 2022.

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Drug pricing is a critical aspect of healthcare accessibility, and the NPPA has been at the forefront of ensuring affordability for patients.

The Union Ministry of Chemicals and Fertilisers, through Minister Bhagwanth Khuba, highlighted that the NPPA has successfully fixed the ceiling prices of 131 anti-cancer scheduled formulations included in Schedule-I of the Drugs (Prices Control) Order, 2013, under the NLEM.

Importance of Drug Pricing

The significance of regulating drug prices, especially for life-saving medications like those used in cancer treatment, cannot be overstated.

High drug costs can be a barrier to access for many patients, making it imperative to have effective mechanisms in place for price control.

NPPA’s Efforts in Price Reduction

The NPPA’s efforts have led to a commendable reduction of around 23% in the ceiling price of cancer drugs.

Minister Khuba, addressing concerns about the affordability of these drugs, reported that the ceiling prices of 112 formulations fixed under NLEM 2022 resulted in a reduction of approximately 22.69%.

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Impact on Anti-Cancer Formulations

The reduction in the ceiling prices of anti-cancer scheduled formulations, as spearheaded by the NPPA, has far-reaching implications for both patients and the pharmaceutical industry.

Let’s delve into the specifics of how these measures have impacted the landscape of anti-cancer drugs.

Union Ministry’s Perspective

The Union Ministry of Chemicals and Fertilisers emphasizes the broader scope of the NPPA’s actions.

According to their statement, the price control authority has notified the retail price of around 2607 new drugs under the Drugs (Prices Control) Order, 2013, till November 30, 2023.

This expansive approach underscores the commitment to ensuring that a wide range of essential medicines remains affordable.

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Minister’s Address in Rajya Sabha

Minister Bhagwanth Khuba, addressing concerns in the Rajya Sabha, shed light on the meticulous efforts undertaken by the NPPA.

The ceiling prices of 112 formulations fixed under NLEM 2022 resulted in a substantial reduction of around 22.69%.

This reduction directly translates to more accessible and affordable anti-cancer medications for patients across the country.

Compliance for Manufacturers

To enforce these price controls, the NPPA mandates that all manufacturers of scheduled medicines, whether branded or generic, must sell their products within the ceiling price set by the authority.

This measure ensures that the benefits of reduced drug prices reach the end consumer, alleviating the financial burden associated with critical healthcare needs.

Click for National List of Essential Medicines (NLEM)

Trade Margin Rationalization

In a groundbreaking move, the NPPA, through an order on February 27, 2019, imposed a cap of 30% Trade Margin on 42 selected non-scheduled anti-cancer medicines.

This initiative, known as ‘Trade Margin Rationalization,’ resulted in a substantial reduction in the Maximum Retail Price (MRP) of 526 brands of these medicines, with some experiencing reductions of up to 90%.

The ripple effect of this decision has translated into annual savings of approximately Rs. 984 crore for patients grappling with the high costs of cancer treatment.

Annual Revision Based on WPI

The pricing landscape is not static; it evolves with economic fluctuations.

The NPPA acknowledges this reality by making annual revisions in the ceiling prices of scheduled medicines based on the Wholesale Price Index (WPI) for the preceding calendar year.

This adaptive approach ensures that the pricing structure remains responsive to market dynamics, balancing the interests of manufacturers and the healthcare needs of the population.

Current Status of Ceiling Prices

As of November 30, 2023, the ceiling prices of 915 scheduled formulations are in effect. Out of these, 700 formulations fall under NLEM 2022, while 215 formulations are categorized under NLEM 2015.

This breakdown illustrates the comprehensive nature of the NPPA’s oversight, covering a diverse range of essential medicines beyond anti-cancer drugs.

Retail Price of New Drugs

Apart from regulating existing formulations, the NPPA also plays a crucial role in fixing the retail price of new drugs as defined in the Drugs (Prices Control) Order, 2013, for existing manufacturers of scheduled formulations.

The notification of retail prices for around 2,607 new drugs until November 30, 2023, underscores the continuous efforts to keep pace with advancements in medical treatments while ensuring their affordability.

Annual Savings to Patients

The impact of the NPPA’s interventions extends beyond mere statistics. The annual savings of approximately Rs. 984 crore resulting from the Trade Margin Rationalization approach underscore the tangible benefits that patients experience.

These savings not only alleviate financial strain but also contribute to a more equitable healthcare system.

Minister’s Response on Essential Medicines

In response to queries about the revision in prices of essential medicines, Minister Khuba confirmed that the ceiling prices of 915 scheduled formulations are effective as of November 30, 2023.

This assurance reaffirms the government’s commitment to ensuring the affordability of a wide range of essential medicines, aligning with the broader healthcare goals.

Disclaimer: This article contains information derived from the source mentioned below. Our team utilized an AI language model to rewrite and present the news or article in a unique format.

FAQs

Q: How does the NPPA determine the ceiling prices of drugs?
- A: The NPPA revises the ceiling prices annually based on the Wholesale Price Index for the preceding calendar year.
Q: What is the Trade Margin Rationalization approach, and how has it impacted drug prices?
- A: The Trade Margin Rationalization approach involves putting a cap on trade margins, resulting in a significant reduction in the Maximum Retail Price (MRP) of certain drugs.
Q: Are all manufacturers obligated to sell their products within the ceiling price set by the NPPA?
- A: Yes, all manufacturers of scheduled medicines, whether branded or generic, must comply with the ceiling prices set by the NPPA.
Q: How often are the ceiling prices of scheduled medicines revised?
- A: The ceiling prices are revised annually on or before April 1, based on the Wholesale Price Index.
Q: What is the current status of the ceiling prices of essential medicines as of November 30, 2023?
- A: As of November 30, 2023, the ceiling prices of 915 scheduled formulations are effective, with 700 formulations under NLEM 2022 and 215 under NLEM 2015.