Drug price regulator NPPA will work out a mechanism to ensure that patients do not pay more for drugs whose prices are expected to go up after the GST implementation, union minister Ananth Kumar said on Friday. Earlier in the day, the National Pharmaceutical Pricing Authority (NPPA) had said that prices of around 78 per cent of ‘actively used’ drugs will remain unaffected after the rollout of the Goods and Services Tax (GST) from midnight tonight.
“Price of drugs where partial increase is expected due to rollout of GST will not be passed on to consumers as NPPA is working out a mechanism in this regard,” Chemicals and Fertilisers Minister Ananth Kumar told reporters in New Delhi.
He further said NPPA is working out a mechanism “to subsume for partial increase of retail prices of some drugs”. Kumar reiterated that “prices of life saving drugs and essential drugs rates will come down with reduction in GST rate”. NPPA has already announced provisional ceiling prices of 761 medicines, including anti-cancer, HIV, diabetes and antibiotics, with a majority being reduced ahead of the GST implementation.
These prices will be notified as formal revised ceiling prices immediately after GST notification, NPPA had said in a memorandum earlier this week. “Prices of approximately 78 per cent of all actively used and traded drugs in the country are going to remain unaffected post GST,” NPPA said in a tweet on Friday.
It had earlier indicated that the prices of majority of essential drugs would increase by up to 2.29 per cent when the GST regime kicks in. The government has fixed GST rate of 12 per cent on most of the essential drugs as against the current tax incidence of around 9 per cent.