Pharmaceutical Sector Update

Drug watchdog NPPA stripped of some of its key powers

In a major turn of events, the government decided to curb National Pharma Pricing Authority's (NPPA)
power to regulate the prices of the medicines outside the National List of Essential Medicines (NLEM).
The withdrawal of the price cap guidelines will be prospective, implying that it will not impact the
decisions taken by the NPPA in the past. NPPA had gained additional power in May through a clause
in the Drug Price Control Order (DPCO) which allowed the regulator to regulate prices of drugs deemed
non-essential in the view of public interest. In July, NPPA cut prices of 108 drugs citing huge differences
in the pricing of different brands in various drug categories. On this the Solicitor General noted that the
power exercised the NPPA should be used only in extraordinary circumstances such as epidemic,
financial deficit or restricted supply of life-saving drugs in the public interest for a fixed time period. This
comes as a good news for the pharma companies but may face opposition from activists.

Government plans survey to estimate the extent of substandard drugs

The government has decided to conduct a nationwide survey to determine the share of sub standard
and spurious drugs in the market. The last such survey was conducted in 2009 by the Drug Controller
General of India (DCGI) where 24,136 samples of 62 brands and 30 manufacturers were drawn from 100
pharmacies. The survey results showed the share of the spurious drugs to be only 0.046%. This time
around, the survey is proposed to be designed by Indian Statistical Institute, Hyderabad in collaboration
with the National Sample Survey Office. It will have a sample size of 40,000 drugs and would mainly
consist of essential drugs. The survey would aim at identifying the geographical areas having high
concentration of spurious or sub-standard drugs and implementing an intensive action plan to
eliminate them. Also, the government might make it mandatory for drug-makers to mentioned the
prescribed storage conditions which must be maintained throughout the supply chain of the drugs.

CCI's

deadline

for

public

scrutiny

on

the

Sun

Pharma-Ranbaxy

deal

ends

The $4-billion Sun Pharma-Ranbaxy deal that would create the fifth largest specialty generics company in
the world and the largest pharmaceutical company in India, has been under the Competition
Commission of India's (CCI) scanner for potentially adverse effects on the competition in the
Indian pharma industry. In order to determine if the deal will have any appreciable negative impact, the
CCI had ordered a public scrutiny of the acquisition where comments should be submitted along with
supporting documents on how the merger can adversely impact the concerned person or entity, the
deadline for which came to an end this week.

Sun Pharma surges over 6% after Credit Suisse report eased concerns on import alerts
According to a Credit Suisse report, Sun Pharma received Form 483 for its Halol facility in Gujarat which
accounts for nearly 20-25% of the company's profits. The report mentions that there are no data integrity
issues on the form thereby reducing the chances of an import alert. This has come in as a positive news
for the company driving its shares up by 6.19% to touch an intra-day of Rs.821.70 on 26th September.
Form 483 (Inspectional Observations) is a form used by the FDA to document and communicate
concerns discovered during its inspections. A recipient of a 483 should respond to the FDA, addressing
each item, indicating agreement and either providing a timeline for correction or requesting clarification of
what the FDA requires. This response must be submitted within 15 business days.

References:

http://economictimes.indiatimes.com/industry/healthcare/biotech/pharmaceuticals/sunpharma-ranbaxy-deal-ccis-public-scrutiny-deadline-ends-today/articleshow/43334822.cms
http://economictimes.indiatimes.com/markets/stocks/news/sun-pharma-offsets-bsehealthcare-losses-stock-rallies-6/articleshow/43510553.cms#
http://economictimes.indiatimes.com/industry/healthcare/biotech/pharmaceuticals/drugwatchdog-nppa-stripped-of-some-of-its-key-powers/articleshow/43273358.cms
http://economictimes.indiatimes.com/industry/healthcare/biotech/pharmaceuticals/governme
nt-plans-survey-to-test-steps-to-tighten-drug-quality/articleshow/43189430.cms