Drug price watchdog sniffing retail mart
NPPA starts collecting samples from across the country to find out the prices that consumers pay for medicines.
By Gireesh Chandra Prasad, TNN |
NEW DELHI: The country’s drug price watchdog has started scanning the retail pharmaceutical market to find out if consumers are being overcharged.
The National Pharmaceutical Pricing Authority (NPPA) has started collecting samples from across the country to find out the prices that consumers pay for medicines. So far, the regulator had been depending solely on the data provided by market research agency ORG-IMS India to identify overcharging.
The data from ORG-IMS India represents the price at which retail chemists get medicines from manufacturers and does not accurately reflect the fluctuations that affect the consumer. Besides, it comes with a time lag due to the enormity of the data collected.
Whenever the regulator fixes prices, it collects samples from the market to know the price the consumer has paid. The idea is to ensure its actions do not result in harassment of the innocent.
The latest national sample collection drive is to get first-hand information about all price-controlled brands that have not obtained a government-approved price and those which are sold above government-fixed prices. The regulator started the exercise over a month ago.
It collects about 50 samples a week. So, in a year it could have 2,500 samples, which would account for about 0.5% of the total market. There are about 52,000 formulation packs in the market. One pack contains a number of strips of a medicine of a particular strength. NPPA has collected samples from Delhi and is now mapping different markets in south India, it is learned.
Drug makers owe the government about Rs 14,000 crore as overcharged amount at 15% interest rate. The amount was Rs 300 crore a couple of years ago. The sharp increase includes new cases of overcharging as well as the interest amount.
The regulator, which has recently asked companies to lower prices of more than 130 drugs or face price control, is taking spiralling prices seriously. While drug makers complain NPPA has started retrospectively applying the 10% ceiling on annual price increases for control-free drugs, the government has not prevented the regulator from doing it.
Allowing a transition period could encourage companies to back-date products, it is felt. That would give pharma companies the leeway to raise prices beyond 10% this year in the pretext that the batches were manufactured last year when a 20% ceiling was allowed.
The data from ORG-IMS India represents the price at which retail chemists get medicines from manufacturers and does not accurately reflect the fluctuations that affect the consumer. Besides, it comes with a time lag due to the enormity of the data collected.
Whenever the regulator fixes prices, it collects samples from the market to know the price the consumer has paid. The idea is to ensure its actions do not result in harassment of the innocent.
The latest national sample collection drive is to get first-hand information about all price-controlled brands that have not obtained a government-approved price and those which are sold above government-fixed prices. The regulator started the exercise over a month ago.
It collects about 50 samples a week. So, in a year it could have 2,500 samples, which would account for about 0.5% of the total market. There are about 52,000 formulation packs in the market. One pack contains a number of strips of a medicine of a particular strength. NPPA has collected samples from Delhi and is now mapping different markets in south India, it is learned.
Drug makers owe the government about Rs 14,000 crore as overcharged amount at 15% interest rate. The amount was Rs 300 crore a couple of years ago. The sharp increase includes new cases of overcharging as well as the interest amount.
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The regulator, which has recently asked companies to lower prices of more than 130 drugs or face price control, is taking spiralling prices seriously. While drug makers complain NPPA has started retrospectively applying the 10% ceiling on annual price increases for control-free drugs, the government has not prevented the regulator from doing it.
Allowing a transition period could encourage companies to back-date products, it is felt. That would give pharma companies the leeway to raise prices beyond 10% this year in the pretext that the batches were manufactured last year when a 20% ceiling was allowed.
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