New policy may make medicines cheaper

A new pharma policy that will substantially bring down several generic drugs8217; prices is likely to be soon in place.

A new pharma policy that will substantially bring down several generic drugs8217; prices is likely to be soon in place. A 14-member committee set up by Chemicals and Fertiliser Minister Ram Vilas Paswan will submit a report in this regard to the Union Cabinet at the end of this month.

The committee is studying legal aspects of the Supreme Court directive on controlling prices of essential drugs and is likely to submit its report by October end, Paswan said today. At a meeting of the committee headed by Chemicals and Petrochemicals Secretary Satwant Reddy, industrial bodies have submitted a list of around 1,000 brands of 8220;generic-generic8221; and 8220;branded generic8221; drugs, whose sale would be subjected to a cap in trade margins.

Paswan said the prices of several hundred brands of generic-generic and branded generic drugs, including Omeprazole and Ciprofloxacin, are set to crash by up to 92 per cent with the pharma industry agreeing to a government proposal on capping trade margins. It has been agreed that the retail margins for these drugs would be kept at 35 per cent while the wholesale margins would be 15 per cent, he said. 8220;This will be effective from October 2.8221;

While competition or de-control has led to reduction in prices in various sectors, it was only the drug industry where the prices have gone up or remained static at best, instead of coming down, he said. 8220;All these initiatives, including starting district level drug banks, are part of the promises made in the UPA8217;s Common Minimum Programme to provide drugs at reasonable prices to the common people,8217;8217; Paswan said.

The Ministry would be setting up drug banks at district levels from January 1 next year, Paswan said, adding that the pharma industry has agreed to set aside 0.5 per cent of its annual turnover to provide free drugs to these banks.

He said the penalty levied from manufacturers, which normally goes to the public exchequer, would also be used to fund the drug banks.

Paswan said the Ministry was making it mandatory to have the local taxes included under the maximum retail prices. The labelling, including dates of expiry, name of the drug and prices, would have to be written in both Hindi and English. Another proposal in the direction of fulfilling CMP promises was to provide health insurance to over 30 crore people below the poverty line.