TITLE- NATIONAL PHARMACEUTICLE POLICY

NAME- AKASH TIWARI

SAP I’D- 81012019603

SUBMITTED TO- PROF. ARUN PA

AFFILIATED- BA.LLB. NMIMS UNIVERSITY, NAVI MUMBAI

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 ACKNOWLEGMENT

Primarily I would thank God for being able to complete this project with success. Then I
would like to thank Faculty of Political Science Prof. Arun PA whose valuable guidance
has been the success, his suggestions and his instructions has served as the major
contributor towards the completion of theproject.
Then I would like to thank my parents and friends who have helped me with their valuable
suggestions and guidance has been helped in various phase of thecompletion of the project.
Last but not the least I would like to thank my classmates who have helped me a lot.

NAME- AKASH TIWARI

ROLL NO. – B194

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 DECLARATAION

I hereby declare that the project work entitled “National Pharmaceutical Pricing Policy”
submitted to the NMIMS (Navi Mumbai) is a record of an original work done by me under
theguidance of Prof. Arun PA.

ROLL NO-B194

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TABLE OF CONTENTS:

S.No: Topics

1. ABSTRACT

2. INTRODUCTION

3. IMPLICATION OF NPP

4. Problems Faced by Physicians

5. How to Overcome These Issues

6. CONCLUSION

7. RECOMMENDATIONS

8. REFERENCES

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 ABSTRACT

Like imany iother ideveloping iand ia ifew ideveloped icountries, iIndia ialso ipartly idepends ion
ipharmaceutical icompanies ifor iits ieconomic igrowth. iRealizing ithe iconcept ialongwith ithe ineed

ito iprovide iaccessible iand iaffordable iessential idrugs ito ithe icitizens, iespecially ithose iof

ieconomical iweaker isection, imany idrugs ior ipharmaceutical ipolicies iwere iformulated iin iIndia.

iSuch ipolicies iensure icontinuous iavailability iof isafe iand ieffective iessential imedicines,

iespecially iin ithe ipublic isector iand iquality, isafety iand iefficacy iof ihuman iand iveterinary idrugs

iinline iwith iinternationally iacceptable istandards iwhile iensuring iappropriate iregulation iand

icontrol, ilatest ibeing ithe iNational iPharmaceutical iPricing iPolicy i(NPPA), i2013, ithe ifocus iof

iwhich iis ito iinclude imore idrugs iunder iNLEP, idecrease iin icost iof imedicines, iproviding

igeneric imedicines, ietc. iThe iuse iof ithe iinternational inon-proprietary iname i(INN), ior igeneric

iname, iis ia irecognized istrategy ito ireduce imedicine icosts iand iexpenditure. iThe ipolicy ithough

iup ito icertain ilevel iprovided ithe irelief iin ithe icost iof iessential imedicines ibut istill imajor iareas

iwere istill iuntouched iby ithe ipolicy. iThis iarticle ideals iwith ithe idrawback iof ithe

ipharmaceutical ipolicies iin iour icountry. iAlso ithe imajor iproblems ibeing ifaced iby ithe idoctors

iwho iare ipart iof igovernment ihealthcare isystem iand ia ivision iof ihow ito ideal iwith iit ior iwhat

imore ican ibe iadded iin isuch ipolicies ito iprovide ithe ismooth iand ieffective ibasic ihealthcare ito

ithe icommunity.

KEYWORD: i iPolicy, iPharmaceutical, iIndia, iPricing

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 INTRODUCTION

Globally, iIndia iis ithe ithird-largest iproducer iof imedicines. iThe iIndian ipharmaceutical iindustry,
idriven iby iknowledge, iskills, ilow iproduction icosts iand iinternational iquality iof iproducts ihas

iwitnessed ia irobust igrowth ifrom ithe iproduction iturnover iof iabout iRs. i5000 icrore iin i1990 ito

1
iover iRs. i1 ilakh icrore iin i2009-10. iBy i2020, ithe icountry iis iexpected ito ibe iwithin ithe itop ithree

ipharmaceutical imarkets iby iincremental igrowth iand isixth-largest imarket iglobally iin iabsolute

isize. iThe iGovernment iof iIndia iunveiled iPharma iVision i2020 iaimed iat imaking iIndia ia iglobal

ileader iin iend-to-end idrug imanufacture. iApproval itime ifor inew ifacilities ihas ibeen ireduced ito

iboost iinvestments. iFurther, ithe igovernment iintroduced imechanisms isuch ias ithe iDrug iPrice

iControl iOrder iand ithe iNational iPharmaceutical iPricing iAuthority ito ideal iwith ithe iissue iof

iaffordability iand iavailability iof imedicines. iFirst iever iDrug iPolicy i1986 iwas ipassed iwith ithe

iobjective iof iensuring iabundant iavailability, iat ireasonable iprices, iindigenous icapability ifor

iproduction iof idrugs. iWith ithe isystem iof iquality icontrol iover idrugs iand ito iencourage icost-

effective iproduction iwith ieconomic isizes iand ito iintroduce inew itechnologies iand inew idrugs, iin
iwhich iall ithe ipoints iwere ilaid idown iregarding iguidelines ifor iregistration, istandardization,

imonitoring iof iadverse ieffects, iuse iof igeneric inames, ietc. iIt ialso ilaid idown ithe icentral iand istate

iinfrastructural ifacilities ifor iquality icontrol iand iline ito iestablish ithe ifirst iNational iDrug i&

iPharmaceutical iAuthority iat ithe icentral ilevel, iwith ia ipermanent isecretariat. iEqually iprices iof

idrugs iwere ithe imain ifocus; ialso iit iwas iin iconformity iwith ithe iprinciple iof iselectivity

icommended iby ithe iHathi iCommittee. iThere iwas ia iuniform inorm ifor iall ibulk idrugs ifalling iin

ithe icontrolled icategory iI iand iII iand ithe imanufacturers iwere igiven ithe ifollowing ithree ioptions:

i14% ipost itax ireturn ion inet iworth; ior i22% ireturn ion icapital iemployed; ior ilong-term imarginal

2
icosting iwith i12% iinternal irate iof ireturn iin ithe icase iof inew iplants.

Research iMethodology: i-
It iis inot ia ifield ibased ior iempirical iresearch. iThe isecondary isources iof idata icollection isuch ias
ithe ibooks iand ivarious ijournals ihave ibeen iused iwith ithe ihelp iof ithe iaccess ito ithe ilibrary iand
ithe isoftware. iThe idatabase iwhich iis iused iin ithis iparticular iproject iis ifrom ithe ilibrary, iGoogle
ibooks iand iarticles ifrom ithe iinternet.

1
iGovernment iof iIndia. iNational ipharmaceuticals ipricing ipolicy, i2012 i.The iGazette iof iIndia, iPart i1, iSection
i1; i2012.
2
Government iof iIndia. iDrug ipolicy, iMinistry iof iChemicals i& iFertilizers. iIndia i1986 iGovernment inotifies inew
idrug ipricing ipolicy, icheaper idrugs ion iway.

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Research Objective:-

My objective behind writing this research paper was to work on 4 situation that was their in the
country:
 Many companies exist but in spite of that the prices of drugs have not come down.
 Same drug is sold in different prices by the same company under different brands.
 Lack of awareness that price is not necessarily a denominator of quality, hence brand
leader is often also the price leader, resulting in selling of costliest drug more and
competition does not automatically bring down the prices. In fact it seems more.
 It has also been seen that the interaction between doctors and pharmacy companies
influences the prices.

Research questions:

 Implications of NPP
 Problems faced by the physicians
 How to overcome these issues

Literature iReview:-

Pharmaceutical imarket iand idrug ipricing ipolicy: iGrowth iof ipharmaceutical iindustry iwith
iadvancement iin imedical itechnology iis icritical ifor isaving ilives iand irelieving imany ifrom

imorbidity i(Kremer, i2002). iEconomic itheory isuggests ithat ian iinnovation-intensive iindustry,

isuch ias ipharmaceuticals, ineeds iintellectual iproperty iprotection ithrough ipatents iand imarket

iexclusivity ias ian iincentive ito iundertake iR&D ifor iinnovations i(Lakdawalla, i2018). iIn ithis

iregard, ithe iincreasing icosts iof iinnovation iand icapital, iand irisks iowing ito ilow itransition irates

iof idifferent iphases iof idrug idevelopment, iare icauses ifor iconcern i(DiMasi iet ial., i1991, i2016;

iInternational iFederation iof iPharmaceutical iManufacturers iand iAssociations, i2017).

iRegulations iand iprice icontrol imay iaffect ithe izeal iof iinnovation iand iavailability iof ieffective

idrugs iin ifuture i(RAND, i2008). iThe iconcern iis iabout ilosing iexclusive imarket—to inot ionly

icover icosts ibut ialso imake iprofits ifor ithe iinnovator ihaving ipatents—as ian iincentive ifor

ifurthering iR&D iinvestment. iBut ievergreening iof ipatents iis ian iabuse ithat ithe ipharma iindustry

ihas ibeen iimplicated iin. iAli iet ial. i(2018) ishowed ithat i72 iper icent iof ithe ipatents igranted ifor

ipharmaceuticals iin iIndia iwere isecondary ipatents, iwhich iwere igranted ifor imarginal

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iimprovements iover ipreviously iknown idrugs ialready ihaving iprimary ipatents. iThe irisks iand

iinnovation icost iof igenerics iare ivery ilow icompared ito ithat iof iinnovator idrugs. iThe iIndian

ipharmaceutical iindustry iis ipredominantly igenericbased. iThere iare ihuge ivariations iin ithe

iprices iof ipatented, ibranded iand igeneric idrugs, iand imedical idevices iin ieach iof ithe itherapeutic

iclasses. iIt iis iso iwithout iany idifferences iin itheir ipharmacopeia/chemical iproperties iand

istandards i(Srinivas, i2014). iPrices iof ipatented idrugs iare iseveral itimes ihigher ithan iof itheir

icounterpart igenerics, iand iprices iof ibranded-generic idrugs iare ihigher ithan iof itrade-generic iand

iother-generic. iAs inoted iearlier, ihigh itrade imargins iin ithe isupply ichain i(GoI, i2004, i2016;

iSelvaraj, i2007), ihuge iprofit imargins iof ipharmacies iattached ito ihospitals i(Mudur, i2017), iand

icosts iof ipromotion i(for iexample, iadvertisements) iand imarketing i(Mulinari, i2016) iare icauses

iof iconcern. iThe isocial irelevance iof iaggressively ipromoting idrugs iand irelated icosts iin ithe

icase iof ilife-saving idrugs iis iquestionable. iThe iincentive imechanism itailored iin idrug

ipromotion icreates iinduced idemand iover iand iabove ithe ioptimum idemand iof ithe ipatients. iIt

imanipulates ithe iactual idemand ifor icheaper isubstitutes iin ieach itherapeutic iclass. iRegulation

iis, itherefore, inecessary ifor isocial iwelfare. iEmerging ialternatives isuch ias ibulk iprocurement

iand idispensing ithrough ipublic ihealthcare icentres i(staterun ioutlets iunder iPMBJAK) imay inot

ibe isufficient ibecause iof ivested iinterests iof ihospitals iand idoctors. iPatients iare inot ieducated

ienough ito isearch ifor ithe itherapeutic-equivalent iin igenerics. iHence, istate iregulations iand iprice

icontrols iare iessential ias ia icorrecting imechanism ito iensure ithe isafety iand iefficacy iof idrugs,

ibesides iensuring itheir iaccessibility iand iaffordability i

MAIN iCONTEXT:

A iDrug iPrice iEqualization iAccount i(DPEA) iwas iset iup iessentially ito iencourage idomestic
iproduction iof ibulk idrugs ithrough ia isystem iof iretention ipricing. iSince ithe ifirst idrug ipolicy,

iwhere ithe iprice ilist iand igeneric idrugs iprescription, ietc., iwere imentioned imany inew ipolicies

icame isuch ias iModification iin iDrug iPolicy i1986, iDrugs i(Price icontrol) iOrder i1995,

iPharmaceutical iPolicy i2002, iNational iPharmaceutical iPricing iPolicy i2012, iwhich iis ithe

irecent ione iwas iapproved iby ithe iCabinet iand inotified iin i2012. iBased ion ithis ipolicy, ia inew

iDrugs iPrice iControl iOrder iwas inotified iin iMay, i2013. iA ilist iof iseveral idrugs iwill icome

iwithin ithe iambit iof iprice icontrol icalled ithe iNational iList iof iEssential iMedicines i(NLEM).

iFor ithe inew ipricing ipolicy iDrugs i(Price iControl) iOrder i2013, ithe imain iobjective iwas ito iput

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iin iplace ia iregulatory iframework ito iensure ithe iavailability iof iessential idrugs ilisted iin ithe

iNLEM iat iaffordable iprices. i4 iHealthcare iaccess iin iIndia iis iaffected iwith i70:70 iparadox; i70%

iof ihealthcare iexpenses iare iincurred iby ipeople ifrom itheir ipockets(out iof ipocket iexpenditure),

iof iwhich i70 ipercent iis ispent ion imedicines ialone, ileading ito iimpoverishment iand

iindebtedness. i5 iThe iincidence iof icatastrophic ihealthcare iexpenditure i(CHE) iis igrowing iand iis

inow iestimated ito ibe ione iof ithe imajor icontributors ito ipoverty. iHealthcare icosts iare imore

iimpoverishing ithan iever ibefore iand ialmost iall ihospitalizations, ieven iin ipublic ihospitals, ileads

ito iCHE iand iover i63 imillion ipeople iare ifacing ipoverty ievery iyear idue ito ihealthcare icosts

ialone. i6 iThe ipolicy iwas ialso ioriented ito idecrease ithis iOPP iand ireduce ithe iburden ion ihealth

iservice iconsumers. iOther imeasures isuch ias iencouraging ithe igrowth iof ithe ipharmaceutical

iindustry iand ithe idevelopment iof inew imedicines iwere ipart iof ithe iframework iof ithe ipolicy. i7

iWith ithis ipolicy, imany iessential idrugs ibecame imore iaccessible ito icommon iman; ihowever,

ithe isituation iis ireverse ifor ipharma icompanies. iAt ione iend iof ithe ipolicy, ithe idrugs ihave

ibecome ieasily iand icheaply iavailable ifor iprocurement iof icommon iman, iat iother iend iit iis inot

imuch isupportive ito ithe iforeign ipharma icompanies, iwhich iultimately iwill ihave ia idetrimental

ieffect. iIt ivaries iwith ithe iprescription iof ithe idrugs iby ithe ipractitioners iincrease ithe icost iof ithe

idrugs. iIn iboth ideveloped iand ideveloping icountries, iprescription iof imedication iis ione iof ithe

imost iimportant ifactors iin ithe irising icosts iof ihealth iservices. iThere iare isome iperceived

idisadvantages iof idrug ipolicy iand iregulations.On ithe ione ihand, iregulations icurb icosts iand

ithus ipotentially iimprove ithe iwelfare iof ithe icurrent igeneration. iHowever, isome iargue ithat

ipharmaceutical iregulations imight ialso ihave inegative iconsequences ifor iconsumers. iFor

iexample, iprice iregulation ican ilead iless icompetition iin imarkets ifor igeneric idrugs, i8 idelay

ilaunch iof inew idrugs, i9 iand ilimit ithe iavailability iof inew idrugs. i10 iIn iaddition, isuch

iregulations imight ireduce ithe ipace iof iinnovation, iby ilimiting ipharmaceutical irevenues iand ithe

iprofitability iof iinvesting iin iresearch iand idevelopment. i11 iThe iavailable idrugs idue ito ihigh

iuncontrolled icost iwere inot iable ito ireach ithe ineedy iwho iwere ideprived iof iall ithe iessential

imedicines. iCost iwas ione iof ithe ifactors iassociated iwith iit. iTo ilimit ithe idrugs icost-based

3
imechanism iwas iused iwhich iproved ito ibe ian iinefficient imechanism ito icalculate ithe iprice.

3
iGovernment iof iIndia. iDrug ipolicy, iMinistry iof iChemicals i& iFertilizers. iIndia i1986 iGovernment inotifies inew
idrug ipricing ipolicy, icheaper idrugs ion iway.

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 IMPLICATION iOF iNPP

 The ipharmaceutical iindustry iplays ia ivital irole iin ithe iworld’s ieconomy, ias iwell ias iin
iensuring ithe iwelfare iof iits icitizens. i13 iThe iIndian ipharmacy iindustry, iwhich iis

iexpected ito igrow iover i15% iper iannum ibetween i2015 iand i2020, iwill ioutperform ithe

iglobal ipharmacy iindustry, iwhich iis iset ito igrow iat ian iannual irate iof i5% ibetween ithe

isame iperiods. iWith ithis irate iof igrowth, ithe icountry’s iGDP iwill ialso igrow. iNot ionly iit

iwill iimpact ithe ieconomy ibut ialso ibeing ithe ilargest iproducers iof igeneric imedicine, ithe

imanpower irequired iin isetting iup iindustries iwill ialso igrow. iFor iexample, igrowth iin ithe

ipharmacy iretail imarket inearly ihalved ifrom inearly i15% iwitnessed iduring i2012’s ifirst

iquarter i(Jan–Mar) ito isingle idigit i8% iduring ithe ifirst iquarter i(Jan–Mar) i2013 iyear.

iSequentially, igrowth i(GDP) islipped ito i11.6% iin i2012’s iQ2, iremained istatic iover itwo

iconsecutive iquarters iat i10.4% iin ithe ithird iquarter iended iSeptember, iand ithe ifourth

4
iquarter i(Oct–Dec) ilast iyear.

 Decrease iin iessential imedicine icosts: iSince imany idrugs iare ibeing ibrought iunder
iNLEP, ithe icost iof ithese idrugs idecreased iautomatically. iAlso ithe iproduction iof imany

ibranded idrugs iinto isome isimpler igeneric idrugs ialso istarted. iThese iwill ifurther

idecrease ithe iper iunit icost iof imedicines. iThe iregulation iof iprices iof idrugs iis ion ithe

ibasis iof iessentiality iof idrugs ias ispecified iunder iNational iList iof iEssential iMedicines

i(NLEM)-2011, ion ithe ibasis iof iregulating ithe iprices iof iformulations iand ion ithe ibasis

iof ifixing ithe iceiling iprice iof iformulations ithrough imarket-based ipricing i(MBP). iAs

iper ithe iprovisions iof iNPPP-2012, iall ithe imanufacturers/importers

imanufacturing/importing ithe imedicines ias ispecified iunder iNLEM-2011 ishall ibe iunder

ithe ipurview iof iprice icontrol. iSuch imedicines ishall ihave ian iMRP iequal ito ior ilower

ithan ithe iceiling iprice i(plus ilocal itaxes ias iapplicable) ias inotified iby ithe igovernment

ifor irespective imedicines.

Problems iFaced iby iPhysicians

4
iGovernment iof iIndia. iDrug ipolicy, iMinistry iof iChemicals i& iFertilizers. iIndia i1986 iGovernment inotifies inew
idrug ipricing ipolicy, icheaper idrugs ion iway.

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1. iShortage iof imedicines: iThe igeneric idrugs, ithough iaccording ito ipolicy ishould ibe iavailable
iin ithe ihospitals, istill iin imany igovernment ihospitals iand ihealth icenters ithey iare inot iavailable

iresulting iin iprescribing ithe imedicines ifrom ioutside. iThere iare ivarious ifactors iinvolved iin

iunavailability iof igeneric idrugs isuch ias iexcess idemand iand ilow isupply iand ilobbying iof

ibranded idrugs iin igovernment istores. iIn ia isituation ilike ithis, iwhere ipatients ihave ito igo iand

ibuy imedicines ifrom ioutside, iresults iin ichaos iand idisorder iamong ipatients iand iattendants. i

2. iIneffective imedicines iand ilack iof iconvincing iinformation ion ithe iquality iof imedicines iin
ithe imarket: iManufacturing iof igeneric idrugs iindigenously iprovides ithe iopportunity ito ideliver

ian iacceptable ilevel iof ihealthcare iat ia ireasonable icost ifor ipopulations iin ithe ideveloping iworld

iincluding ithe iever-growing inumber iof idisplaced icommunities, iwho iare ileft ibehind iin ithe

ieconomic irace. iAlthough ithe imanufacture iof igeneric iessential idrugs ioffers ia ipractical iway iof

iachieving ithis iaim, ithe iquality iof ithese iproducts itends ito ibe ijeopardized iby ioverriding

iconsiderations iof icost. iAssuring ithe iquality iand isafety iof iessential idrugs iis iparamount ito

iachieving ieffective iimplementation iof inational idrug ipolicies, ipharmaceutical iprograms iand

ihumanitarian irelief ioperations. iFor igeneric idrugs, ithe iaffectivity iof ithe idrugs iis istill idoubtful.

iThe iFDA iallows idifferent idrug iformulations iand idifferent irates iof irelease iand iabsorption.

iThe iFDA iaccepts igeneric idrugs ithat iare i20% iweaker ior i25% istronger ithan ithe ibrand iname

imedication. iThese iproblems iexplain iwhy igenerics iare iineffective ifor isome ipatients, iand iwhy

igenerics iare itoo istrong iand icause idrug iside ieffects iin iothers. iAt itimes, ithose imedicines

iwhich iare iavailable iin igovernment ipharmacy, iare inot ivery ieffective. iEven iafter icontinuously

iprescribing ithe imedications, iit idoes inot ihelp iin iimproving ithe icondition iof ithe ipatients. iIt ihas

ibeen iseen iand iexperienced iby imany iphysicians ithat ithe isame isalt iof idrugs iif igiven ifrom

igeneric idrugs iavailable iin igovernment isetups iand ithose iavailable ioutside, ithe iaffectivity ito

itreat iinfections iand imorbid iconditions iis imore iwith idrugs ifrom ithose iavailable iin ioutside

imarkets. iAccording ito ia idoctor iin iAIIMS, i“there iare icertain igeneric imedicines ithat idon’t

iwork ilike ithe ibranded iones. iIn iAIIMS, icertain igeneric idrugs iare inot iprescribed, iinstead

ibranded iones iare ipreferred.” iThis iclearly iindicates ithe ilack iof iquality icontrol iin

ipharmaceutical icompanies. i

3. iCombination imedicines: iCombination imedicines ithat iare ieasier ito iprescribe iwith igood
ipatient icompliance iare iavailable iin ithe imarket. iIn ispite iof iknowing ithat ifor imedicines isuch

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ias iantibiotics iwhereas icompliance iis irequired ithe icombination imedicines iwork iwonders ibut

isuch imedicines iare inot iavailable iin igovernment istores, iwhereas iit iis imandatory ito iprescribe

igeneric imedicines; ipatients iare ibeing ileft iout iof iappropriate itreatment

4. iAdvanced/ iRecent imedicines: iHealthcare ihas ibecome iincreasingly isophisticated, iwith irapid
idevelopment iof inew idrug imolecules, idrug icombinations iand iother ihealth itechnologies.

iMedicines iwith icombination iof ione ior imore imedicines iand imedicines iwhere irecent

idevelopments iare ialso iavailable iin imarkets iwhich iare inot iavailable iin igovernment istores. iIn

isuch iconditions, iwhere ia iphysician iknows ithat ithe ipatient ican ibe ibenefitted iby iadvance

imedicines ibut iis inot iable ito iprescribe iit idue ito iunavailability iof isuch imedicines, iresults iin

ilosing ior ino iimprovement iin ithe icondition iof ithe ipatient, iwhich iis iethically iwrong.

How ito iOvercome iThese iIssues

1. iThough ipolicies iare imade ibut ieither ithey iare inot iimplemented ior ithose iwhich igot
iimplemented idid inot ifocus ion iactual iproblems ior iground irealities. iInadequate ipolicy iscope,

iweak igovernance istructures iand ilack iof ieffective itechnical ioversight iof ithe ipharmaceutical

isector ialways ipersists.One iof ithe isolutions iis ito iinvolve ithe iphysician iin ithe imaking iof

ipolicy idrafts. iThose iwho iwork idirectly iwithin ithe isystem ican ionly ibe iable ito ihighlight ithe

iproblems ibeing ifaced iby ithem ipertaining ito iprescribing idrugs iand iall.

2. iIn ievery ipart iof ithe icountry, ia ibig ieconomic idivide iis ithere. iThere iexists ian ieconomically
isound isection iwho ican iafford icostly imedicines, iwho icomes ito igovernment ihealth ifacility

iputting iin ifaith ion ithe iexperience iof iphysician ibut ithey iwere inot iprescribed ithe ibest iof

iavailable imedicines ibecause ithe ipharmaceutical idoes inot ipermit iprescription iof imedicines

iother ithan ithe igeneric iones. iThis iis iunethical ifrom itheir ipoint iof iview ithat iin ispite iof ithe

ineed iof igood iand ieffective idrugs iwhich ithey iare iwilling ito ibuy iare inot iprovided isuch

imedicines ijust ibecause iour isystem iis inot iflexible iand idoes inot icater ito ithe ineed iof ithem.

iThese iover iregulations iof ithe ipolicies ishould ibe istopped. iOur isystem ishould ibe iflexible

ienough ior itreating iphysicians ishould ibe igiven ichoice ito itreat ithe ipatients isubjectively. iOr iin

iother iwords, ione istandard itreatment idoes inot ifit ievery ipatient. iSince iit imodifies iwith ithe

ipatient’s icondition, ithe idrugs iwhich ithe iphysician ican iprescribe ishould ialso ibe imodified iand

ithat iis inot ipossible ijust iby ilimited idrugs, iespecially iwhen ievery iother iday iadvanced iand ibest

imedical icare iproducts ior imedicines iare ibeing idiscovered. iIf ia iperson ican iafford imore

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ieffective imedicines, ithere ishould ibe iprovision ifor iproviding ithem iafter iprobably itaking

iwritten iinformed iconsent ifrom ithem.

3. iCreate irules iand iregulations ithat iallow igeneric isubstitution iin ithe ipublic, ifaith-based iand
iprivate isectors. iIt iwill ibe iincumbent iupon ithe ipharmacist, ibefore idispensing ia iprescription, ito

iinform ithe ipatient ion ithe ibenefits iof igeneric isubstitution iand ito iensure ithat isuch isubstitution

itakes iplace iwith ithe ifull iunderstanding iand iconsent iof ithe ipatient. iAffirm ithe iright iof

ipatients ito imake iinformed idecisions iconcerning itheir iown ihealth, iincluding ia ichoice ifor

igeneric imedicines.

4. iResearch iand idevelopment i(R&D) iis ione iof ithe ikey ifeatures iof ithe iglobal ipharmaceutical
iindustry. iFor idevelopment iof inew idrugs iand itechnologies iand iimprovement iin ithe

iperformance iof iexisting iproducts, iR&D iis irequired. iA icurrent igap iis ithat iR&D iis ivirtually

ilacking ifor ithe ineglected idisease iconditions ithat idisproportionately iaffect ipoor ipopulations.

iThe iGlobal iStrategy iand iPlan iof iAction i(GSPOA) ion iPublic iHealth, iInnovation iand

iIntellectual iProperty, inegotiated ithrough ithe iWorld iHealth iAssembly, iprovides ia iglobal

iframework ifor ibetter iinvestment iin iR&D ifor ineglected idiseases. i

5. iIn isome icountries, ifor iexample iGermany,automatic isubstitution iof ithe idrug iis iacceptable
ilegally. iIt isimply imeans iafter itelling ithe ibenefits iof igeneric idrugs iand isubstituted icompound

iand igiving ithe ichoice ito ipatients ior iconsumers, ithe igeneric idrugs ican ibe ireplaced iby iother

isalts ior isame isalts iwith ihigher iquality. iSuch iamendments iin ipolicies ican ialso ihelp iin igiving

ihealth idecisions iinto icommunity ihands.

CONCLUSION:

On ithe inote iof ia iconcluding iremark iit ican ibe isaid ithat, iexcessive icontrol iover iprice iof idrugs
iwill inot ihave ia igood iimpact ion ithe ipharmaceutical iindustry. iThe ipurpose iwith iwhich ithe

iGovernment iundertakes icontrol iover iprice iof idrugs iis ito imake isuch idrugs iaffordable,

iavailable iand iaccessible. iHowever, iexcessive iprice icontrol ireduces ithe iattractiveness iof ithe

ipharmaceutical iindustry iin iturn ihampering ithe igrowth iof idrug imanufacturing icompanies ias

ithey iface icost iconstraints. iDomestic imanufacturers imake igeneric idrugs iat ia imuch icheaper

iprice ihence, iattracting icustomers ito ipurchase ithese ialternative isubstitutes.

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In iprice-controlled isegments, ias ia imanufacturer iis irequired ito isell iat ithe iprices ifixed, ibarriers
ito ientry iinto ithe imarket iare icreated iby ifocussing ion iexisting ibuyers ithereby inot iproviding ia

ifair iopportunity ito ia inew ientrant. iThis ican ibe iconsidered ito ibe ianti-competitive ias inew

ientrants iresist ifrom ientering iinto ithe imarket. iSuch ia icontrol iin iprice imay iadversely iimpact

ilocallymanufactured igeneric ialternatives ias iit ireduces ithe iprice iof ithe iMNC ilabelled ioptions,

ithereby idecreasing ithe iprice igap iand iperhaps imaking ithe iMNC ilabel imore iattractive ifor

iconsumers.

Some ilessons ithat ican ibe ilearnt ifrom ithe istudy iof ithis iPolicy iare ithat ilicenses ishould ibe
iissued ito isome ilocal imanufacturers iso ithat ifew idrugs iwhich iare iout iof ireach iof isome ipeople

iare ieasily iaccessible. iOne imost iimportant ieffort ithat iGovernment ishould ifocus iupon iis

istrengthening iour iR&D isector iin ithe icountry iand imaking iit imore ilucrative ifor iforeign ifirms

ito iinvest iin iPharmaceutical isector, ithereby iamounting ito ian iincrease iin iefficiency iin

iproduction, isupply, idistribution, istorage, iacquisition ior icontrol iof igoods/ iservices. iThis iwould

iresult iin ifostering ihealthy icompetition iin ithe irelevant imarket iif iat iall iJoint iVentures iare

ipromoted ias ia imethod iof ientry iinto ia iforeign imarket.

Major iRecommendations i

 iThe iweighted iaverage iprice iof iall ibrands, ihaving igreater ithan i1% imarket ishare iformula iwill
iresult iin iover i40–70% iprice ireduction iin i60% iof ithe iNational iList iof iEssential iMedicines

i(NLEM). iThe iWAP imechanism ito icontrol ithe iprice iof iessential imedicines iwill iachieve itwin

iobjectives iof ipublic ihealth iand iindustrial igrowth.

 i348 iessential idrugs, iincluding icancer iand iHIV imedicines iwill icome iunder ithe ipurview iof
ithe ipricing ipolicy. i

 iThe ipolicy iwould inot ionly iprove ito ibe imiracle iof ireduced-price iranging ifrom i40 ito i77%
ibut iit iwould ialso ibring ihope ito ithousands iof ipoor iand ineedy iones iwho iunfortunately iare

iusually ideprived iof ithe ibasic ihealthcare ias ithe igovernment ihas iassured iof icontinued

iavailability iof ithese imedicines ieven iafter ithe iprice ireduction iafter ithe iimplementation iof ithe

ipolicy. i

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 iUnder ithe icurrent icost-base iformula iof idetermining ithe iprice iof ithe idrugs, ithe iexpenditure
ion iresearch i& idevelopment ion iexport imarket idevelopment iwas inot ibeing iconsidered iat iall.

iHowever, ithe imechanism isuggested iin ithe ipolicy ito idetermine ithe iprice iof idrugs iwould

ireflect ithe icost.

However, ione iimportant idrawback iof ithis ipolicy iwas ithat iit iwas iunable ito iput isome
ilifesaving ipatent idrugs iunder ithe ipolicy. iThis ifurther iis idetrimental ias isome idrugs isuch ias

iARV idrugs iused ifor itreatmentof iPLHA/HIV iwere ibeyond ithe icoverage iof ithis ipolicy, ihence

istill iupto ithis itime ialso ithey iare iout iof ireach iof ithe icommon iand ineedy ipeople,resulting iin

iincreased ipurchasing iof idrugs iprivately, ii.e., iout iof ithe ipocket iexpenditure i(79%).

REFERENCES:

 Government iof iIndia. iNational ipharmaceuticals ipricing ipolicy, i2012 i.The iGazette iof
iIndia, iPart i1, iSection i1; i2012

 Government iof iIndia. iDrug ipolicy, iMinistry iof iChemicals i& iFertilizers. iIndia i1986
iGovernment inotifies inew idrug ipricing ipolicy, icheaper idrugs ion iway. iFinancial

iExpress i13 iDec, i2012. iAvailable iat: ihttp://www.financialexpress.com/news/governmen

it-notifies-new-drug-pricing- ipolicy icheaper i[accessed ion iOct i1, i2016].

 Government iof iIndia. iDrug ipolicy, iMinistry iof iChemicals i& iFertilizers. iIndia i2013.
 Golechha iM. iHealthcare iagenda ifor ithe iIndian igovernment. iIndian iJ iMed iRes i2015;
i141: i151-53. i

 Government iof iIndia. iNational ihealth ipolicy idraft. iMinistry iof iHealth iand iFamily
iWelfare, iGovernment iof iIndia, iNew iDelhi. i2014. i

 Government iof iIndia. iDepartment iof iPharmaceuticals. iMinistry iof iChemicals i&
iFertilizers. iAnnual iReport i2015-16

 Danzon iM, iChao iL. iDoes iregulation idrive iout icompetition iin ipharmaceutical imarkets?
iJournal iof iLaw iand iEconomics i2011; i43(2): i311-58. i

 Danzon iM, iWang iY, iWang iL. iThe iimpact iof iprice iregulation ion ithe ilaunch idelay iof
inew idrugsevidence ifrom itwenty ifive imajor imarkets iin i1990s iHealth iEconomics i2005;

i14(3); i269-92

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