Price Modifications Announcement by the NPPA

NPPA: Based on WPI data furnished by the Economic Advisor's office, the annual WPI change for the calendar year 2023 is calculated at (+) 0.00551 percent compared to 2022

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NPPA National Pharmaceutical Pricing Authority
Picture: Pixabay

Last Updated on April 11, 2024 by The Health Master

NPPA

The National Pharmaceutical Pricing Authority (NPPA) has released updated price limits for 923 scheduled medications as of April 1, 2024.

This adjustment aligns with the fluctuations in the Wholesale Price Index (WPI) reported at the conclusion of March 2024, comparing the year 2023 to 2022.

The alterations amount to a minute 0.00551 percent starting April 1, 2024.

Revisions and Adjustments

The price revisions have been solidified through various notifications issued by the end of March 2024.

Manufacturers of scheduled formulations listed in the notification, with maximum retail prices lower than the ceiling prices set in the fiscal year 2023-24, are entitled to adjust their existing MRPs based on the 0.00551 percent WPI for the year 2022.

This alignment is in accordance with the regulations outlined in the Drugs Prices Control Order, 2013.

Manufacturers retailing scheduled formulations at prices exceeding the government-fixed ceiling prices must reduce the prices of such formulations, not surpassing the current ceiling price specified in the notification, exclusive of Goods and Services Tax (GST), as specified by the Authority.

Compliance and Reporting

Any adjustments made must be promptly reported to the Government in either electronic or physical form using Form-II within fifteen days of the revision.

Failure to provide such information will be considered as non-compliance with the MRP revision, and the concerned manufacturer will be liable to refund any amount charged over the pre-revised MRP, along with accrued interest from the date of overcharging.

WPI Data and Regulatory Provisions

The NPPA recently disclosed that, based on WPI data furnished by the Economic Advisor’s office, the annual WPI change for the calendar year 2023 is calculated at (+) 0.00551 percent compared to 2022.

As stipulated by Paragraph 16(2) of the Drug Price Control Order (DPCO) 2013, manufacturers are permitted to adjust Maximum Retail Prices (MRP) of scheduled formulations based on this WPI without prior government approval.

Historical Data and Notable Changes

It’s worth noting that the NPPA announced a significant annual change of 12.1218 percent for scheduled drugs starting April 2023, derived from data provided by the Economic Advisor’s Office.

This marked the highest increase in recent years, following a 10.7 percent change in 2021 over 2020.

The WPI increase for pharmaceuticals in 2020 stood at 1.88 percent, 4.26 percent in 2019, and 3.43 percent in 2018.

While there hasn’t been a general decrease in prices due to WPI changes, 2016 saw a decrease of 2.71 percent compared to 2015.

Ceiling Prices and Regulatory Framework

The ceiling price for a scheduled formulation is determined based on the average retail price of the formulation with a market share of one percent or more.

Since the ceiling price is calculated from the average retail price of existing medicines, there’s a reduction in prices when setting the retail price of scheduled medicines for an existing manufacturer.

Moreover, the ceiling prices of scheduled medicines are revised annually on April 1st based on the Wholesale Price Index for the previous calendar year.

For non-scheduled formulations, the NPPA ensures that their MRPs do not increase by more than 10 percent over the preceding twelve months.

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.

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