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Tuesday, May 5, 1998
Measure of relief
The National Pharmaceutical Pricing Authority has revised the prices of 21 formulation packs -- the third major price revision in the last four months. The Drug Price Control Order is a millstone around the industry's neck, and affects the capability of the industry to prepare for the new patent regime to be ushered in 2005. The fact of the matter is that domestic competition in several drugs is more than sufficient to take care of the interests of consumers. Take the case of a bulk drug such as ciprofloxacin -- there are over thirty manufacturers in this drug alone, compared to a mere handful in most other countries. The fragmented nature of the industry in India is very different from that in the rest of the world, and Indian drugs are among the lowest-priced in the world. In many antibiotics, for example penicillin, the price of the drug is lower than the DPCO-mandated price. Multinationals have had their fingers badly burnt by trying to keep drug prices high. Recently, Pfizer was forced to slash the priceof its cardio-vascular drug Amlogard to around a fourth of its earlier price due to severe competition. The Indian bulk drug industry has been reeling under the pressure of cheap imports and dumping, and yet price controls are being used to further depress margins. Under such circumstances, it makes little sense to try and force drug prices down even further -- that will only be counter-productive.To be sure, there is a case for keeping some life-saving drugs and certain other categories under price control. For example, prices of drugs in the anti-TB segment need to be controlled, given the fact that India is the largest TB market. But in most cases, there exists a cogent argument for taking drugs off the DPCO, and giving a measure of relief to the pharmaceutical industry. Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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