SC rejects govt’s new drug pricing proposals

The Supreme Court today asked the union government not to fiddle with the existing pricing system for essential drugs, and also to inform the court within a week when it would notify a new list of essential medicines under the drug price control mechanism.

"We make it clear that the central government should not alter the price system as notified on 13 July 1999 and similar subsequent notification," said a bench headed by Justice G S Singhvi, while granting seven days to the centre to decide on the pricing of essential medicines.

Hearing a public interest litigation filed by the All India Drug Action Network (AIDAN) , which has been seeking to get the price of essential drugs reduced, the bench said it is concerned about the issue and it is necessary for the court to intervene into the issue.

Acting on an order of the Supreme Court itself, the government constituted a group of ministers headed by agriculture minister Sharad Pawar to look into the matter to reduce prices of essential drugs.

The ministers last week finalised proposals to present to the cabinet for final approval; but activists including the AIDAN, which had filed the original petition, said the proposals would increase rather than reduce the prices of drugs. (See: NGO to challenge drug price control over lacunae) 

Under the earlier 1999 mechanism, the pricing of essential drugs was based on the prices set by the market leader. Under the proposed new drug policy, this was sought to be changed to the "weighted average price" of brands that have more than 1 per cent market share,  which activists say will push up the prices of the cheapest brands, while not significantly lowering the prices of the most expensive brand.

"Under the garb of price control, a mechanism for raising prices is being smuggled in," Amit Sengupta of the Jan Swasthya Abhiyan (JSA), a public health advocacy group, says.

For example, there are 61 brands of the popular hypertension medicine Amlodipine.

The most costly brand sells for Rs6.40 per tablet and the cheapest one for just Rs0.15. The WAP for this is calculated at Rs1.84. That is less than the costliest brand but it is 12 times more costly than the cheapest one.