Make Drug
price affordable to the poorest
The government wants to amend the Drug Price
Control Order (DPCO). New rules are proposed by the National Pharmaceuticals
Pricing Authority (NPPA), Industry says this will kill competition
and hurt drugmakers. DPCO rules were last written in 2013. In India, over 70%
of the population is driven to private, uninsured medical care. Of the total
healthcare spending, 70% is on medicines. So, controlling drug prices is very necessary.
Yes, price controls make sense for a select set
of drugs. Centralised purchases, by healthcare providers or insurance
companies, can bring down drug prices without price control. An element of cost
in the drug industry is unethical gratification of doctors to induce them to prescribe
particular drugs. Containing this is an urgent and huge challenge.
What is DPCO? Drug Price Control Orders (DPCO)
are issued by the Government, in exercise of the powers conferred under section
3 of the Essential Commodities Act, 1955, for enabling the Government to
declare a ceiling price for essential and life saving medicines (as per a
prescribed formula) so as to ensure that these medicines are available at a
reasonable price to the general public.
The term "Drug" Includes - (i) all
medicines for internal or external use of human beings or animals and all
substances intended to be used for, or in the diagnosis treatment, mitigation,
or prevention of any disease or disorder in human beings or animals, including
preparations applied on human body for the purpose of repelling insects like
mosquitoes; (ii) such substances, intended to affect the structure or any
function of the human or animal body or intended to be used for the destruction
of vermin or insects which cause disease in human beings or animals, as may be
specified from time to time by the Government by notification in the official
Gazette; and (iii) bulk drugs and formulations.
Price controls are applicable to what is
generally known as “Scheduled drugs” or “Scheduled formulations” that is, those
medicines which are listed out in the Schedule I of Drug Price Control Order
(DPCO), issued by the Government of India from time to time
National Pharmaceutical Pricing Policy (NPPP)
is the policy governing price control and DPCO is the order by which price
control is enforced. The Drug Price Control Orders are issued by Ministry of
Chemicals and Fertilisers,
Why price control? As per WHO estimates, the
economic impact of pharmaceuticals is substantial -- especially in developing
countries. While spending on pharmaceuticals represents less than one-fifth of
total public and private health spending in most developed countries, it
represents 15 to 30% of health spending in transitional economies and 25 to 66%
in developing countries. In most low income countries pharmaceuticals are the
largest public expenditure on health after personnel costs and the largest
household health expenditure. And the expense of serious family illness,
including drugs, is a major cause of household impoverishment. Despite the
potential health impact of essential drugs and despite substantial spending on
drugs, lack of access to essential drugs, irrational use of drugs, and poor
drug quality remain serious global public health problems:
India is among the countries with the highest
Out Of Pocket (OOP) expenses on health care. Indian Pharmaceutical
industry is, globally, the 3rd largest producer of medicines by volume yet 14th
in terms of value. The lower value is due to the fact that Indian medicines are
amongst the lowest priced in the world. However, despite this, medicine costs
continue to be an important component in the overall medical expenditure in the
country, given the low purchasing power of the citizens.
There is a need to revise the Drug Policy to
meet the challenges brought about by the competitive international
pharmaceutical industry in a globalised economic environment, as much as
meeting the country’s requirements for safe and quality medicines at reasonable
prices.
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