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Drug prices control order

Topics Covered:Government policies and interventions for development in various sectors and issues arising out of their design and implementation.

 

Drug prices control order

What to study?

For Prelims: About NPPA, DPCO and scheduled drugs.

For Mains: Issues involved and the need for drug price monitoring, relevance of DPCO.

 

Context: National Pharmaceutical Pricing Authority (NPPA) has allowed an increase in the maximum retail prices of 21 drugs currently under price control by as much as 50%.

Significance:

The decision has been taken to ensure that the life saving essential drugs must remain available to the general public at all times. This is to avoid a situation where these drugs become unavailable in the market and the public is forced to switch to costly alternatives. This is the first time the NPPA — which is known to slash prices of essential and life-saving medicines — is increasing prices in public interest.

What is the “Drugs (Prices Control) Order (DPCO)” ? 

The Drugs Prices Control Order is an order issued by the Government of India under Sec. 3 of Essential Commodities Act, 1955 to regulate the prices of drugs.

The Order interalia provides the list of price controlled drugs, procedures for fixation of prices of drugs, method of implementation of prices fixed by Govt., penalties for contravention of provisions etc.

For the purpose of implementing provisions of DPCO, powers of Govt. have been vested in NPPA.

Are all the drugs marketed in the country under price control ? 

No. The National List of Essential Medicines (NLEM) 2011 is adopted as the primary basis for determining essentiality, which constitutes the list of scheduled medicines for the purpose of price control. The DPCO 2013 contains more than 600 scheduled drug formulations spread across 27 therapeutic groups. However, the prices of other drugs can be regulated, if warranted in public interest.

What is NPPA and its role? 

National Pharmaceutical Pricing Authority (NPPA), was established on 29th August 1997 as an independent body of experts as per the decision taken by the Cabinet committee in September 1994 while reviewing Drug Policy.

Functions: The Authority, interalia, has been entrusted with the task of fixation/revision of prices of pharmaceutical products (bulk drugs and formulations), enforcement of provisions of the Drugs (Prices Control) Order and monitoring of the prices of controlled and decontrolled drugs in the country.

Sources: the Hindu.