New policy brings 354 drugs under price control

01 July 2006

Mumbai: The new National Pharmaceutical Policy, announced by the government on Saturday, adds 354 specified drugs to the existing 74 drugs under the list of essential medicines, thereby bringing them under price control, an official statement said here.

The new policy also proposes to fix trade margins on generic drugs at 15 per cent for wholesalers and 35 per cent for retailers.

The policy, however, proposes a 200 per cent overall mark-up on cost prices against the 100 per cent currently allowed.

Announcing the policy, Union minister for chemicals and fertilisers Ram Vilas Paswan said the government would make drugs available to the poor, especially those living below the poverty line. He was speaking at a meeting of the consultative committee of the Parliament.

The new policy brings 354 drugs of specified strengths, mentioned in the National List of Essential Medicines (NLEM) 2003, in addition to the 74 formulation already existing, to the list of price-controlled drugs.

The new policy, however, allows for a 100 per cent overall increase in the maximum allowable post-manufacturing expense (MAPE). While the policy provides for a general increase in MAPE from the current 100 per cent to 150 per cent, there is also a provision for allowing an additional 50 per cent MAPE as research and development incentive for pharmaceutical companies.