Pharma promoters are clearly upping the ante against the Supreme Court order, which last week asked the government not to alter the (existing) price structure of (essential) drugs. In one such instance, Swati Piramal, director, Piramal Healthcare, in a letter to Sharad Pawar, head of GoM on pharma pricing policy, has written that it would be nearly impossible for the industry to manufacture and supply essential drugs if the SC order prevails. Piramal estimates that the SC order, if implemented would bring over 70% of the Indian pharma market under price control regime. The domestic drug market is pegged at around R68,000 crore.
Piramal quotes an IMS analysis to state that between 2006 and 2009, new introductions for molecules (drugs) under Drug Price Control Order (DPCO) diminished while for non-DPCO molecules they rose.
Already, of the 74 drugs under price control today, only 47 are being manufactured. While the drug companies claim that they have been forced to discontinue the remaining as they are no longer economically viable, the health activists who have consistently maintained that cost-based formula should continue argue that many of these molecules have actually gone out of market as they have been discarded and are not being used by doctors in clinical practice anymore.
Stating that price of the medicine may not be the only barrier to access, Piramal said, “It is a tragedy that iron deficiency and other vitamin deficiencies affect 70% of our population. The cost of an iron tablet is less than a rupee, so actually the problem is not about price but about access. In fact, (drugs addressing) diseases of national importance must be freed from price control, so companies can invest behind access”.
Voting for the formula recommended by the GoM, Piramal projects that its application would result in over 20% price reduction in 60% of the medicines under national list of essential medicines (NLEM). She said the average price formula, which would cover almost 94% of the drug market, which is being brought under price control and nearly double the coverage of share of drug market under price control when compared to existing coverage.