NATIONAL PHARMACEUTICAL POLICY-2006
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- Title
- NATIONAL PHARMACEUTICAL POLICY-2006
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RF_DR_35_ASUDHA
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January 23, 2006
Comments on the Draft National Pharmaceutical Policy (DI 3
06) 2006 Part A from LOCOST Baroda/JSS Bilaspur
General Comments
1) Many of the statements made in the Draft National Pharmaceutical Policy (DP
06) appear to be agreeable in the absence of details. The devil is in the details.
2) While the intentions are good, the focus ol the DP 06 comes across, regrettably,
as a how-to-make-lndia’s-pharma-induslry- flourish-further type of document
with a T‘‘-v sops thrown in for the poor. etc.
3) We found the Pronab Sen C ommiltcc had more locus especially rcyards making
medicines affordable, etc. for instance, the Pronab Sen Committee had advocated
debranding. 1 here is no mention ol this anywhere. Nor on irrational combination
drugs and what is to be done with them.
4) Nor is there any situation analysis of the present pharma scenario form the point
of view of affordability, users, etc.'
1 l or instance:
o In the WHO report on “ The World Medicines Situation 2004” In India, an
estimated 499-649 million people (50% to 65% of the population) do not have
regular access to essential medicines.
o A survey done by Strategies for Enhancing Access to Medicines Program on
Access to Essential Medicines in Rajasthan 2001, more than 40% of the
population surveyed found drugs unaffordable.
o
Healthcare costs have been rising, and the proportion of people who do not seek
treatment because of financial reasons has increased in both the rural and urban
areas according to the NSS. Expenses made on healthcare arc the most common
cause of non-production related indebtedness in the rural areas today.
o Drug costs form nearly 70% of out of pocket expenses of outpatient care, and
nearly 50% of inpatient care expenses
o
Deregulation of drug prices in the past has increased I he drug prices, as
documented by committees appointed by the Government (DPGRC).
5) Nor lhe rccomniendalionsol'lhe Nation;il ('oiniiiission on Macroeconomic; and
I Icallh, especially regarding irrational drags, have been taken into account. (See
Annexure 1).
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6) A Pharmaceutical Policy is for the whole nation: hence it should also have focus
(apart from encouraging industry) on removing irrational and harmful drugs and
promotion of generic drugs especially those in Hie Nl-iMI.. These measures are
important for reduction in cost of health care. See How to develop and iinpleinent
a national drug policy. — 2nd ed. [Updates and replaces: Giridelines for
developing national drug policies (1988). WHO, Geneva.]
7) The National Pharmaceuticals Policy thus is to be seen a prime instrument to
operationalise some of the priorities already defined in the National Health Policy
(NHP 2003).- The policy once again does not make this clear, and from the
parentheses in the document, which mention the need for the hcallh ministry to
comment on the draft, it seems that that the policy has not gone through a detailed
process of consultation with the Ministry of Health. It thus seems to perpetuate an
untenable situation. India is one of the few (or probably the only) countries of the
world where the pharmaceutical policy is framed by a ministry other than the
Health Ministry. Also it is a bit of contradiction that the 1)1’ 0.6 itself mentions the
formation of an integrated NIM'A - hopefully (he ND TA should come out with a
policy statement that reflects concerns of health in a national pharma policy.
8) The benchmark for a National Pharmaceutical Policy is therefore its health
impact. There is enough evidence that, in spite of the stated objectives of
ensuring availability of good quality medicines at a reasonable price, the same
has not been achieved by previous policies; and in fact there have been severe
market distortions.3
'>) A public website like in developed countries should give not only complete drug
information but also what are the drug prices of various brands/drugs. Along with
a medication error reporting service (the scope of the National
Pharmacovigilance Authority can be enlarged.) is required.
10) There is no comment on the criteria for introduction of new drugs (sec for
instance the British criteria of introduction of new drugs by of NICE
(http://www.nice.org.uk/)4. Or see the work of the National Prescribing Centre
Il may be pointed out that it should be a tool for actualizing other national goals like making Indian
industry world class, etc. We agree but we submit that it will be a severe tragedy for the people of India to
have a world class industry and at the same time have a neglected health sector where essential drugs have
|)oor access and/or is unaffordable.
for more discussion, see LOCOST/JSS: Impoverishing the Poor: Pharmaceuticals and l^ru^ Pricing in
India
Currently NICk produces guidance in three areas of health:
I echnology appraisals - guidance on the use of new and existing medicines and treatments within the
NHS in England and Wales.
and National Horizon Scanning ('cnlrc of the UK? Indeed the p<>lic\ is silent on
Approval and licensing mechanisms ol new drugs to he introduced.
1 1) New drug approval in the country could be decided by the proposed National
Drug Authority on the basis of safety, efficacy, public health relevance, costeffectiveness or convenience of administration, of the new drug. Approval should
not be given if the new drug is more expensive, not more efficacious, than
existing alternatives. It should be a transparent process with details on reasons
accepted/rejected available to the public through a dedicated website. I he letter of
approval for a new drug to be marketed in India, its approved indications,
contraindications, patient information material, etc., should be available on a
website and on request from the NDA. Any violation of the letter of approval
terms, should constitute a serious violation. The letters of approval of existing
drugs should also be made available for public viewing at a website. Ihis is an
important step forward in increasing consumer and healthcare professionals
awareness.
12) A continued complaint is of state drug controller giving manufacturing licenses
for new combination drugs and formulations, even when they are not empowered
to do so. This should attract a strict penalty amounting to dismissal from service
(if spurious drug manufacturers can be thought to be hl tor the death row, this is
the least punishment one can effect on deliberately errant drug controllers).
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Some drugs in India (especially combinations) are not manufactured anywhere
else in the world, some drugs in the post-marketing state are found to be
hazardous, and have been banned or severely restricted in their use in other
countries. If India aspires to world-class status in the pharma sector it should also
conform to world-class standards of what is considered a rational, or safe drug.
The NDA should be mandated to respond within a period of 6 months in a
scientifically tenable manner to any complaint made by healthcare professionals
or civil society organization in the public interest, about the rationale ol allowing
a particular drug to be marketed even though it is of dubious rationality and
efficacy^safety.
•
Interventional procedures - guidance on whether interventional procedures used lor diagnosis or
treatment are safe enough and work well enough for routine use in England, Wales and Scotland.
■*' See for instance “The role of national agencies in the managed introduction of new
drugs for arthritis” in
Katrina Simister Ann Rheum Dis 2000;59(Suppl 1 ):i38-i40 ( November)
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13)Thu trade margins suggested may be reduced by l/3rds as they arc on MRP. II
MRP is higher trade margins would be higher - therefore lhere is here an
incentive to market high priced (likely to be irrational as well) drugs outside the
price control basket.
14) Also the crucial issue related to (13) above is how the govt is going to fix actual
costs of production, criteria for price control and decontrol, etc.
15) We reiterate that the earlier criteria were faulty because -
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Any criteria based on MAT and cutoff is not very rational
As it excludes inevitably some very essential drugs
And some drugs which are virtual monopolies are out of price control
16) Price Control Criteria
• Price control/ceiling price criteria to be based on rationality, essentiality and
national security and
• Criteria and pricing policy should discourage production of drugs not in
NEML
• Generics should also be under price control if we want o encourage the use of
generics (which is what a rational drug policy should do).
17) Fiscal Incentives for Production of ONLY Rational, Essential and Generic
Drugs
The policy suggests fiscal incentives at places. We suggest fiscal incentives
be given for only essential drug production in the form of tax breaks, tax
exemptions, etc.
18) In addition, direct and indirect taxes on socially debilitating and disease causing
items like pan masala, tobacco products, alcohol, etc. may be increased (the
MOCF and MOI IFW may have to strongly suggest these measures to thc’MOF.
An integrated pharma policy has to look into health as a whole.
19) All incentives and policy regarding research and clinical trials should underscore
transparency, concern for human rights and ethics. The introduction of Clinical
trial registry is very important along with conflict of interest declarations among
all members of pharma related policy committees. Our proposed intention of
becoming world class industry should be accompanied by the highest standards of
ethics in research.
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20) Mandatory Review of TRI PS: Doha had clearly mandated the review of TRIPS
under Art. 27.3(b) and 71.1.6 All references to this mandatory review have
disappeared in the Hong Kong declaration. India did raise the issue of biopiracy
and the need for the TRIPS amendment to have compulsory disclosure on sources
of origin of biological material and traditional knowledge. This does not find any
clear commitment in the Hong Kong declaration. The review of Art. 71.1 has
been conveniently substituted by making permanent the non-workable Para 6 of
the declaration on TRIPS and Public Health. It is all the more important therefore
that the draft pharma policy mention the importance of review of TRIPS and that
this must continue to be a high priority for India as it affects the availability and
affordability of drugs directly.
(This is being mentioned especially in the context of TRIPS compatibility to
be examined by Mashelkar Expert Group. If this Expert Group docs not suggest
this, the draft pharma policy must make a mention of the need for mandatory
review.)
21) Another Reason for Mandatory Review of TRIPS: As already pointed out,
drug prices and health care costs have become more unaffordable in the recent
years (despite motivated attempts by pharma industry lobbies to quote selectively
from ORG type studies). The Report of the National Commission on
Macroeconomics and Health, Government of India, has also pointed this out. If
healthcare costs have risen because of increase in drug prices, it is a clear
indication of a lack of an effective national pharmaceutical policy. This situation
is slated to worsen with the onset of compliance with the TRIPS regime.
We quote the National Health Policy (NHP 2003):
2.26.1. With the adoption of Trade Related Intellectual Property Rights
(TRIPS), and the subsequent alignment of domestic patent laws consistent
with the commitments under 1 RIPS, there will be a signil'ictint shill in (he
scope of the parameters regulating the manufacture of new drugs/vaccines.
Globa) experience has shown that the introduction of a TRIPSconsistent patent regime for drugs in a developing country results in
an across-the-board increase in the cost of drugs and medical services.
( emphasis ours)NHP-2002 will address itself to the future imperatives of
health security in the country, in the post-TRIPS era.”
We expect therefore the Pharma Policy to address
health security in the post-TRIPS era.
the future imperatives of
The Doha Round cannot be considered complete without completion of the
mandatory review. Article 71.1 mandates a review every two years. It also
empowers the council for I RIPS to “undertake reviews in the light of any
relevant new developments which might warrant modification or amendment of
this agreement”.
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22) Public-Private Partnerships These need to be carefully articulated. Whether
high prices, for instance of cancer drugs are justified need to be thought of. It
may be mentioned for instance that tamoxifen, an anti-cancer drug used in breast
cancer treatment is available at widely different prices from Rs 30 to Rs 120 -all
manufactured by reputed companies. The point we are trying to make is that anticancer drugs are as much irrationally priced like other drugs (same drug being
available at a vast range of prices.)
23) Skewed Focus on Cancer and AIDS
All diseases of public health importance need to be given importance. To chose
two diseases in particular out of the entire gamut of public health priorities is a
piece-meal approach which is against the interests of public health. In a country
where TB is the most important single killer and where the highest number of
MDR-TB patients exists, is it proper to exclude TB? Can one ignore newer drugs
for falciparum malaria, for diarrhea, for respirator}' tract infections, for
hypertension and diabetes (in which we have the highest prevalence in the world).
This piecemeal approach shall not even work for the cancer patients.
For
instance, cancer patients during chemotherapy can develop infections and for
which they require antibiotics which if made outside the purview of this system
will still inflate costs.
24) Income-tax and other exemptions may be given for those producing drugs for
all life threatening disease (and not only on cancer and AIDS) - PPP should not
become a way of unnecessarily subsidizing industry. 200 % weighted deduction
under 35 (2 AB) or equivalent may be thought of for all companies making only
generic, essential drugs as per the NEML 2003 (anot only for the so-called gold
standard companies, mentioned in pp 34-35.
25)The Rashtriya Bima Yojana (pp 27-28) although well intentioned, is not
practical and also may be a non-starter like the Universal Health Insurance
Scheme. It would mean in practice, one would go to a private practitioner or a
PHC and take the prescription from one’s village to the nearest taluka level
chemist shop (imagine if the “medicine” is an anti-snake venom). It is a waste of
time and questions like cost of transport to first get the prescription and then the
drug - possibly travel in different directions, etc., would make this scheme
impractical and may not be therefore used at all. On the other hand, why not think
of enhancing the PHC drug budget and see that the PHC/CHC functions properly
and is stocked with medicines adequately.
26) User Fees: The Rajasthan Model (page 30) referred to has its source of income,
user fees. These user fees are substantial and create s dent in people's pockets.
There is strong evidence that direct and indirect user fees for primary education
and essential healthcare arc a barrier to access for the poor. Indeed, the .leflivy
Sachs chaired MDG Reports have recommended eliminating user fees for basic
health services in all developing countries, financed by increased domestic and
donor resources for health.7
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27) It is indeed otherwise laudable that the draft policy recommends strongly the
replication of the Rajasthan Medicare Societies. We would recommend opening
of these stores even outside the premises of the hospitals akin to the State
Pharmaceuticals corporation of Sri Lanka.
28) The policy should have recommended equally strongly the replication of the
TN and Delhi models of bulk procurement in the public system all over the
country within a specific time frame, by which the public system will be able to
provide drugs free to an increased number of people without an increased
allocation.
Some other points which are missing from the draft:
29) Government’s stand on Essential Medicines concept is not clear.
Are Essential Medicines lists only to be prepared under duress of the Supreme
court like it was done in 1996, 2003.?
We strongly feel that the Pharmaceutical policy has to be rooted in the Essential
Medicines concept, which is a tried and tested measure to improve drug
availability and health outcomes. The Policy should promote and implement
selection of essential medicines, promotion of production of these drugs, ensure
availability of information about these drugs to the consumers and prescribcrs,
and promote rational use of these drugs. Essential medicines list should be
prepared every 2 years by a Standing committee made from various* stakeholders
along with the National Drug Authority. It should also formulate standard
treatment guidelines for various levels of care, an Indian National Formulary
released every year, an updated source of information for the healthcare
professional which can be called the Indian Prcscriber, and should formulate and
review the various Drug Procurement documents in the country.
30) Lack of Monitoring Indicators: There is neither clear implemenation plan nor
any monitoring indicators in the daft policy. For instance, would the policy
undergo review if drug prices1 rise unacceptably? The policy should have
monitoring and review mechanisms in place for even other goals specified.
7 Report of the Task Force on HIV/AIDS, Malaria, TB, and Access to Essential
Medicines, Working Group on Access to Essential Medicines. Sterling, Va.: Earthcscan.
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31) How and where does this policy address the traditional systems ol medicines.'
Without addressing this significant part of the pharmaceutical sector, how can it be
called a pharmaceutical policy. It should be called then the National Allopathic
Pharmaceuticals policy. Right now labeling a drug as ayurvedic is a tactic to escape
price control, or quality assurance.
32) Also there is no comment on the burgeoning multibillion rupee industry called
Nutraceuticals and how to regulate the runaway prices and irrational claims made
and how nutraceutcials add to the immiserisation wrought by seeking health care in
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this
country.
33) The introduction to the policy should do a frank situation analysis of the
pharmaceutical sector like the NHP did for the public health system.
Can the policy ignore the simple fact that India has one of the highest numbers ol
formulations in the world (atleast over 20,000), which do not conler any health
benefit but rather waste people’s precious resources?
If part A is to consider issues other than statutory price control then it should be
addressing the issue of drugs which are not going to be subjected to price contiol.
The draft does not clarify the mechanism of price control and the content at all.
34) Promotion of prescribing information for doctors and rational use of di ugs.
Mere production of drugs is not enough. They should be used judiciously in the
minimum number essential for the treatment of any illness. The policy should
mandate the publication of a regularly updated Indian National formulary,
standard treatment guidelines, to be distributed among all doctors, along with
regular prescription audits conducted al both public and private health facilities.
The policy should mandate provision of proper package inserts in medications
which conform to international standards.
35) Regulation of drug promotion and advertisements:
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Wasteful and unethical promotion of drugs is inflating drug costs. There should
be a strictly implemented code of conduct on promotion, acceptance of gifts, and
the manner of advertisements of drugs. The USFDA has well defined standards
on drug promotion, and their monitoring.
36) Price Control Complaints
The Drug price control monitoring cell should respond to complaints about price
variations made by healthcare professionals or consumer groups or civil society
organizations, and also forward them to the NDA.
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Specific Comments (we refer to j
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para numbers of the Draft Policy document and
also give page nos of the downloaded document
for reference.).
------- —• easier
37) Comment on 2.0
Past approach does not specify:
o
Why the number of drugs under price control were reduced?
O What was the rationale for including, excluding a drug from price
control?. What for example is the justification of excluding drugs for
anemia? diarrhea(ORS), all TB drugs, all antimalarials, etc from price
O What was the effect of deregulation?
38) Para 3.11 Excise Duty payable on MRP (Maximum Retail Price), p 6
Why not make even VAT on a percentage of MRP?
39) Para 4.0 Key Policy Objectives, p 6
The following objectives may be added:
•
1 o complement the objectives of the National Health Policy (NHP) 2003
• To discourage inessential drugs and irrational combinations
• To develop criteria (or suitable mechanisms) for new drugs to be allowed to
be manufactured/marketed in this country.
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Rationale for above comments: The objectives of the policy should be Health
objectives, Economic objectives and Development objectives.
The policy under this head, mentions in the last line that it shall facilitate
implementation of the National Health Policy, without mentioning it as an objective.
The policy at the moment gives primacy to economic objectives rather than health
objectives.
A continuing banc of the Indian pharmaceutical industry has been the presence of
irrational and hazardous drugs and combinations which are ■wasting people’s
resources and exposing them to risk. A large
- of such drugs
-OJ are being now
masqueraded as nutritional supplements. The policy should make a statement to
eliminate such drugs which are dubious in terms of efficacy, safety relevance if ii
u y e leves that it will make the Indian industry world class How can on> '
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•he sale nPhnndreds of brands of nlnresubde suspXsio „
dren LX 'role '
revenue, when the same is banned for use below 12 years o age bvZ F
Medrmnes Evasion Age^y, and .he drug is no, avaiX Xt® meX
The policy should state that it
1. will be within the overall health policy of the country'’
will be based on the Essential Medicines Concept?
4’ wm’ fr0™01! rat'Onal
°f drUgS by healthcare Professionals and consumers^
5' w
T j 1I7at,onal and hazardous drugs from the pharmaceutical market^
3. will safeguard the rights of the patients/consumers.
40) Page 9: Constitution of ND A -hope it is
not merely a name change of the CDSCO.
41) Page 10: NADTtimeframie may be specified.
42) Page 10: Intellectual Property Rights including Data Protection
ta’ i„'e“y exnens "h
A" dala f,led sh°“ld
P»Hio domain So
43) Clinical Trials and Drug Development
a. The draft policy assumes, wrongly in our opinion, that certain data have to
openness. ,f
a^mg’S
sL“aS"NllQsOfUMhiC!^n'8T™'S”Edi'Orial
Feb2004.
used Indian patients as guinea pigs”. BMJ2001; 323:1204 (24 November)3 m'tS SCienUSI
A so ^e: -The truth of the 'drug' trials”. Frontline, Volume 18, Issue
Nov. 24 - Dec
A Case of Betrayal", Frontline, Volume 22 - Issue 25 Nov 05 -18 200S tn th
tssue a related report, “A award and some claims” reported
ic9 hnve been convinced lot
Some eddor. .0 repuiod etedieal ,o.«no >
„
„
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nnvi <Dat medical journals
•■Sponsorship.
Xin'Sd.^ e^panies. io ? d^,;1X“™
»f"“ "”T
Aorhoeship. and decounidb.lo' m >■1’
ies of disroninS *e 'eso o
nedical journals accuse
= ^TIk Lancet, the \ew Englan
leading n
research for the sake of p
Medica} Associatton ano
of sclentihe
Journal of Medicine, the Jout nal of
thgir mQ y . or the
other major journals accused the dru
with legal conttaet.
threat of its removal - to tie up
Qn the resuits ot orug
so that they are unable to. report fre
environment in
o-iais. -We are concerned tto thare recrul a
XXrepor,ed) may
precious objeciivity.
h
In the United States, the Food and‘
' now requires that all trials on life-th«a
into
National Instltmei
e
:X“X;nX-S^ed tJs were reared dunng
d'e hiitial period of the law's implementation.
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c.
- to be available
avanauic on a
redressal mechanism
are being
Apart from a clinical
™“'d-How s“' “ b“ef,‘
S
286. No. 10. September 12'^g^^/^n/jedlOOSb.htm^. The signatories were.
<htip://jama.ama-assn.org tssuie
of Internal Medicine', Catherine D_
Frank Davidoff. MD eaitor^men ,
■’
m editor-in-chief, Aen
editor> Canadian Medical Assouan
DeAngelis, editor. .LIMA
England.Journal ojMedicuu .Jo
'editor-in-chief. Tidsskrifl Jor Den
Journal: Liselotte Hojgaara. MD. DMSc.
4swc!alion); Richard Herton. FRCP.
Lyelorenin, (.Journal of.he
V" ve X, MEDLINE/Index Medicos;
’■
hS c. sox. MD. editor.
,
"
Mieb.el S.«»«. MD-
aolhors «ere oreo.bers of rhe
;“J'Zco....
Statement by 13 editors op.cit.
>-Beyond Trial Registration: A Global ma.
” Quoted in: Ida Sim and Don E. Dum
B
lssue 11, Nov 2005.
Bank for Clinical Trial Reporting . PLOS. Volun
from clinical trials in India? Will the drugs be provided at a cheaper rate
will we share royalty’/ If so how? ‘
44) Anticancer Drugs, Anti-HIV/AIDS Drugs, pp 12 and 13
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What is so special about cancer'? There are a whole lot of diseases (diabetes for example
debditatmg phys.cally and financially life-long and there are 7 million diabetes patients ’
in India, most of them very' poor)), communicable and non-communicable, that require
similar preferential treatment.
45^] ”P1L^)llc“Pnvale Partnership Programme for Anti-Cancer and Anti-HIV/AIDS Drugs
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We are afraid this is very/ wishy-washy and without details thought through and expectine
also that Industry' and trade would be asked to reduce their margins - both profit and
trade margins to the barest minimum level and pass on the benefit to the consumers “
(page~ 13-14) is wishful thinking. Trade and industry have never been known to pass on
benefits and concessions given.
Why not say- all such drugs there will be no product patents applicable (is consistent with
Doha ano \\10) or CLs would be issued as a matter of course.
46) Prices of Drugs for Other Life Threatening Diseases (page 15)
We feel that there are two options with regard to the list of drugs that need prefential
treatment.
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The first and the preferred option are to have a list of categories of drugs that
address key disease and healthcare problems and which shall be under price control.
I he second option if the first is not considered operationally suitable, is to have a
core list of drugs for price control which are drawn from key categories and a
supplementary' list of drugs whose prices, trade margins and market shares shall be
- 1 he World Health Organization's department for Technical Cooperation for
Essentia! Drugs and Traditional Medicine (TCM) and UNDP have recently published a
paper written by James Love entitled. "Remuneration guidelines for non-voluntary use of
a patent on medical technologies". The reference of this paper is "WHO/TCMP005 1"
and is number 1 8 of the TCM Series on Health Economics and Drugs. See
h!lPL-?..Y- ’■> -w ho.int entit\ niedicines areas/technical coor>eration/WHOTCM2005 1 OM
Sjtdl’
=
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closely monitored and brought under the ambit of price control based on their quantum of
sales, market share, price movements, trade margins.
1 he National List of Essential Medicines 2003 represent a selection of the
efficacious, safe, and cost-effective medicines for the priority conditions affecting health
in India. 7 herefore the National Lisi forms a sort of reference list from which the list of
drugs to be placed under price control has been drawn. (Please see Annexure 1 fora
suggested list.)
47) Trade Margins (para 6, page 16)
These are way too generous, and dangerous, and since they are based on MRP, the trade
will veer towards costlier drugs in the same class and costlier brands of the same drug.
We suggest reduce the margins by at least l/3rds. And establish a general ceiling on
maximum retail prices and/or post-manufacturing margins using benchmarking based on
well-run procurement systems as suggested by the Pronab Sen Task Force.
48) Excise duty relief (para 7, p 17) Should be given only for generic drugs NEML.
Aim of fiscal incentives should be to promote rational drugs (or let us say drugs in
NEML). Excise duty relief etc., is seldom passed on anyway.
49) MRP inclusive of Taxes (para 8, p 17) Very desirable.
50) “10. Drugs and Therapeutics ( Regulation ) Act”, pp 18-19
10 e) We suggest a brand registry for all drugs, foods and cosmetics (including
pesticides and veterinary drugs) as common salt can be mistaken for antiepileptics
(’’...a prescription was written for Lona, a brand of antiepilepsy drug clonazepam
marketed
by 7'riton Healthcare Private Limited, Chennai. The "patient” was sold Lona, exactly
as prescribed, but it contained low sodium salt marketed by Dabur and meant
for hypertensives!” (Source: Editorial in MIMS Indiana 2004).
51) Bulk Procurement system for Drugs by Government, para 12, pp 21-22
“Procurement preferably in the form of generic drugs" - -may be changed to ’’quality
generics unless otherwise not available” and 80 percent of drugs procured must be from
only those given in the NEML 2003 or equivalent.
52) “13.0 Lower Prices for bulk purchases by Government”, p 22
a. Has to be seen what is the ceiling price mechanism.
b. ’’For drugs other than those under cost based price control and patented drugs
-a ceiling price of 50% of MRP of the drug.” This should not be the final
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criteria for price as sometimes market prices of drugs not in control could be
way high.
53) “14.0 Promotion of Generic Drugs”, pp. 22-23
"Quality certification would be provided free of cost to generic drug
manufacturers through an appropriate scheme” - how do you define a generic
manufacturer? As there are very few or almost zero generics only mfrs. Also is
this free quality certification for each drug or for the whole manufacturing
facility?
54) “15 Control on Pharmaceutical brands”, p 23
Misbranding comments are well-made. There is need to close escape hatches like if a
brand drug comes under price control, one cannot make a near equivalent with a near
sounding brand name. Also brand names of banned drugs cannot be used again (for
example Baralgan became Baralgan plus etc). To escape price control of brands
brought newly under price control, new brands with almost near sounding names and
almost equivalent formulation should not be allowed (Becosules became Becosule
plus).
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There is nothing on debranding advocated by the Pronab Sen Committee.
55) “16. Quality Certification of drugs”, p 24.
Bioequivalence and bioavailability should not become a trade barrier. It can become a
trade barrier if in vivo testing (in the human body) is insisted upon in contrast to in
vitro (“in the test tube”).
56) 20 c, page 30: the Rajasthan Model seems to have some problems —these should be
taken care of when extending this idea. (See Roy Chaudhury, Ranjit and Nirmal
Kumar Gurbani. Enhancing Access to Quality’ Medicinesfor the Underserved.
Anamaya Publishers, New Delhi, 2004.)., The user fees issue has already been
pointed out.
57)
“25. Development of Orphaned Drugs”, p 37
Definition of orphaned drugs is not what is normally understood.
58) “Gold standard Companies”, p 35
Definition of gold stnd cos. - only a handful would be able to make the grade
honestly that is. Can good R &D not be done in a smaller scale?
59) “26 Scheme of Interest Subsidy for implementation of Schedule M of Drugs and
Cosmetics Rules for Good Manufacturing Practices”, page 37
Schedule M deadlines are past. What are you going to use the money for? May be for
the new certification of quality (like AG mark) being talked about?
60) “28.0 Settlement Commission’1, p 38
Price Monitoring and Public Awareness need not wait for crumbs from the Settlement
Commission as and when. This is an important activity that needs to be funded
anyway.
Annexure 1
Report of the National Commission on Macroeconomics and Health (extracts)
During September 2005 another important Government appointed commission gave its
report. Among other things it obseiwed that:13
...Ten of the top 25 drugs sold in India are non-essential, irrational or hazardous.
The market for drugs is highly concentrated with implications on price setting.
Price of drugs
Only 76 drugs accounting for around one-fourth of the drug market are under
price control. An examination of the price trends of 152 drugs (consisting of 360
formulations) reveals that antibiotics, anti-tuberculosis and anti-malarial drugs,
and drugs for cardiac disorders, etc. registered price increases from 1 %-l5% per
annum during 1976-2000. Indian households spend 50% of their total health
expenditures on drugs and medicines. Reducing this burden and ensuring access
can be achieved by: (i) bringing all drugs under price control to ensure lower
prices for the households; (ii) streamlining and putting in place a system of
centralized pooled procurement of drugs so that the public health system can save
almost 30% to 40% on costs; (iii) weeding out irrational drugs and irrational
combination drugs: and (iv) encouraging ISM drugs for treating diseases for
which efficacious and low-cost drugs are available. Price control, as is the
practice in several countries such as Canada, is justified on the basis of the drug'
prices outstripping WPI. Second, this will address about 90% of the health needs
of the community and reduce household spending on these services. Price control
should not be limited to essential drugs as the industry can then simply switch its
production to the non-controlled categories, depriving people of access to
essential drugs....
Access to affordable drugs14
n Executive Summary of the Report of the National Commission on Macroeconomics and Health,
Government of India.
li is difficult to predict the impact of the Patent Act on the access to drugs, both in
terms of price as well as availability. At the time of the writing of this report
there are various scenarios emerging, ranging from cautious optimism to
downright pessimism. Given the agreed position on the necessity to ensure that
we safeguard this basic and fundamental right to access to essential medicines,
there is need to carefully study experiences of other countries and coping
strategies from the patients and not only the commercial point of view. We see
the Governments role to be very critical in being able to exploit the strengths and
minimize the threats that are inherent in this Act.
•
Expand pi ice control of all drugs and mandate use of only generic drugs in all
publicly funded programmes. Such price caps will help contain costs.
•
Weed out irrational drugs and irrational combination drugs to substantially
reduce household drug expenditures.
•
A minimum VAT of 1% as against the proposed 4% should be levied for
essential drugs
•
Fix ceilings on trade margins as suggested by the interim report of the Sandhu
Committee.
•
Centralized pooled procurement reduce government expenditure by over 30%50/o. For this, we recommend adoption of the TNMSC model throughout the
country.
•
The recommendations of the Mashelkar Committee regarding setting-up of
the National Drug Authority (NDA) with an autonomous status to take up the
functions of drug pricing, quality, clinical trials, etc. need to be implemented
without delay. Consequently, the present National Pharmaceutical Pricina
Authority (NPPA) could be merged with the proposed NDA and Central
Government provide assistance to states for strengthening the drug regulator)'
system.
•
The Patent Act passed recently needs to clarify the scope of patentability;
reasonableness of royalty to be paid on the issuance of compulsory licensing;
definition of significant’ for the Indian companies manufacturing these drugs,
mechanisms for automatic compulsory licensing and strengthening of the
regulatory bodies to ensure that drug
Annexure 2
N Recommendations of the Report of the National Commission on Macroeconomics and Health,
Government of India.
OPTION A -DRUG PRICE CONTROL BASED ON THERAPEUTIC
CATEGORIES AS DEFINED IN THE NATIONAL LIST OF ESSENTIAL
MEDICINES
The National List of Essential Medicines 2003 as well as the WHO List of Essential
Medicines mentions 27 categories of drugs. Of these for the purpose of price control 17
categories have been selected. The categories chosen represent drugs required for the
public health problems, for common conditions in health care, categories in which drugs
are at present expensive or there is evidence of overpricing. All drugs included in these
therapeutic categories are proposed to be covered by price control.
I. ANTIINFEC1IVE MEDICINES: (includingAntihelminthics, Antibacterials including betalactam
and other antibacterials, antileprosy , antituberculosis, Antifungals, Antivirals, Antiprotozoals),
II. MEDICINES AFFECTING THE BLOOD: (Antianemia
coagulation)
medications and medicines affecting
III. CARDIOVASCULAR MEDICINES( Antianginal , antiarrhythmics, antihypertensives, medicines used
in heart failure, antithrombotic medicines)
IV. MEDICINES ACTING ON RESP.TRACT.(antiasthmatic medications, antitussives)
V. HORMONE, OTHER ENDOCRINE MEDICINES, CONTRACEPTIVES.(including antidiabetics and
thyroid and antithyroid medicines)
VI. IMMUNOLOGICALS (including sera and immunoglobulins, and vaccines)
VII. GASTROINTESTINAL MEDICINES (including antacids and anti-ulcer medications, antiemetics
antiinflammatory medicines, medicines used in diarrhea)
VIII. PSY CHOTHERAPEUTIC MEDICINES (including medicines used in psychotic disorders, mood
disorders, generalised anxiety and sleep disorders)
VIII. ANTICONVULSANTS/ANTIEPILEPTICS:
IX. ANTINEOPLASTIC. IMMUNOSUPPRESIVES. AND MEDICINES IN PALLIATIVE CARE
X. ANALGESICS, ANTIPYRETICS,
RHEUMATOID DISORDERS
NSA1DS,
DISEASE
MODIFYING
XL ANTIALLERGICS AND MEDICINES USED IN ANAPHYLAXIS.
XII. BLOOD PRODUCTS AND PLASMA SUBSTITUTES
XIII. DERMATOLOGICAL MEDICINES
XIV. DISINFECTANTS AND ANTISEPTICS
XV. DIURETICS
/7
AGENTS USED IN
XVI. OPHTHALMOLOGICAL PREPARATIONS
XVII. VITAMINS AND MINERALS
■
E: OPTION B
A core list of drugs from key therapeutic categories to be under price control and a supplementary
hst compns.ng alternatives from the same therapeutic categories whose prices will be rigorously
monitored.
LIST 1: CORE LIST
ANALGESICS, ANTIPYRETICS, NSAIDS, DISEASE MODIFYING AGENTS USED IN
RHEUMATOID DISORDERS
I
I
1)
Non-opiod analgesics, antipyretics, Non-steroidal anti-inflammatory medicines
Acetyl salicylic acid
2)
Ibuprofen
. 3)
4)
5)
Diclofenac
Nimesulide
Paracetamol
Opiod analgesics
6) Morphine
7) Pentazocine
8) Pethidine hydrochloride
Disease modifying agents used in rheumatoid disorder
9. Methotrexate
lO.Sulfasalazine
ANT1ALLERGICS AND MEDICINES USED IN ANAPHYLAXIS.
11) Pheniramine maleate
12) Cetrizine
13) Dexamethasone
14) Hydrocortisone
15) Prednisolone
ANTICON VULSANTS/ANTI EPILEPTICS:
16) Carbamazepine
17) Diazepam
18) Phenytoin sodium
19) Sodium valproate
Antihelminthics
ANTI1NFECTIVE MEDICINES
20 Albendazole
21 Pyrantel pamoate
Anti-bacterials
a. Betalactam antibacterials
22 Amoxicillin
23
Ampicillin
If.
24 Benzathine penicilin
25 Benzyl penicillin
26 Cefotaxime
27 Ceftriaxone
28 Ceftazidime
29 Cloxaci Ilin
■
Other antibacterials
30 Amikacin
31 Gentamicin.
32 Azithromycin
33 Cephalexin
34 Clarithromycin
35 Chloramphenicol
36 Ciprofloxacin
37 Cotrimoxazole
38 Doxycycline
39 Erythromycin
40 Metronidazole
41
42
Norfloxacin
Vancomycin
Antilcprosy medicines
43 Clofazimine
44 Dapsone
I
45 Ethambuto!
46 Isoniazid
47 Ofloxax in
48 Pyrazinamide
49 Rifampicin
50 Streptomycin
■
Antituberculosis medicines
Drugs for drug resistant TB:
51 Cycloserine
52 Ethionamide
53 Kanamycin
54 Capreomycin
Antifungal medicine
55 Fluconazole
56 Griseofulvin
57 Amphotericin B
Antiviral medicines
Antiherpes
58 Aciclovir
Anti retrovirals
59 Laniivudine
60 Stavudine
''I
61
Zidovudine
62
63
Efavirenz
Nevirapine
Non-nucleoside reverse transcriptase inhibitor
Protease inhibitor
64 Indinavir
65 Nelfinavir
66 Ritonavir
67 Saquinavir
ANTIPROTOZOAL MEDICINES
Anti amebic and antigiardiasis medicine
68 Diloxanide furoate
69 Metronidzole
70 Tinidazole
71
i
1
72
Anti-Kala azar medicine
Pentamidine isoethionate
Sodium stibogluconate
73 Artemisinin derivatives, (artesunate. Antimalarial medicines
aretemether, etc)
74 Chloroquine phosphate
75
Primaquine
76 Quinine
77 Sul fadox ine+ Pyrimethamine
ANTINEOPLASTIC,
immunosufprcsives am
78 Inj. Cisplatinum
79 Inj. Doxorubicin
80 Inj. 5-Fluorouracil
81 Tamoxifen
,
82
, medicnes in palliative care
Palliative care
Ondansetron
MEDICINES AFFECTING THE BLOOD:
Antianemia medications
8j All iron salts and iron containing compounds
84 Folic acid
85 Vitamin B|
86 Combinations of iron containing compounds with folic acid with/without other ingredients.
Anti anginal medicines
87 Isosorbide dinitrate
88 Isosoroide mononitrate
89 Metoprolol
90 Propranolol
91 Glyceryl trinitrate
Antiarrhythmic medicines
92 Amiodarone
93 Adenosine
CARDIOVASCULAR MEDICINES
GASTROINTESTINAL MEDICINES
Antacids, Anti-ulcer
123 Aluminium hydroxide, magnesium hydroxide
124 Ranitidine
125 Famotidine
126 Omeprazole
Antiemetics
I
127 Domperidone
128 Metoclopramide
•
129 Bisacodyl
130 Isphagula husk
Laxatives
I
Medicines used in diarrhea
131 Oral rehydration salt
HORMONE, OTHER ENDOCRINE MEDICINES, CONTRACEPTIVES.
Contraceptives
132 Ethinylestradiol+levonorgestrel
133 Ethinylestradiol + norethisterone
Anti-Diabetic
134 Glibenclamide
135 Glipizide
136 Gliclazide
137 Glimepride
138 Pioglitazone
139 Insulin (Soluble) bovine/porcine/human
140 Intermediate acting Insulin (Lente/NPH) bovine/porcine.' human
Thyroid and Antithyroid medicin
141 Carbimazole
142 Levothyroxine
IMMUNOLOGICALs
143 Anti-D immunoglobulins
144 Anti-snake venom
145 Anti-tetanus horse/human
146 Diptheria antitoxin
147 Rabies immunoglobulin
Vaccines
148 Hepatitis B vaccine
149 Hemophilus influenzae vaccine
150 Rabies vaccine cell culture, purified chick embryo, vero cell
OPHTHALMOLOGICAL PREPARATIONS
151 Sulphacetamide sodium
152 Tetracycline hydrochloride
Anti-glaucoma medications
153 Betaxolol hydrochloride
3^ I
94
95
96
Lignocaine hydrochloride
M exileline
Diltiazem
Antiln pertcnsivcs
9"
98
99
Amlodipine
A:enolol
Enalapril
IC"' Thiazide diuretics.
10: Losartan
Medicines for heart failure
102 Digoxin
103 Frusemide
104 Dobulamine
105 Dopamine
Antithrombotic medicines
106 Streptokinase
10" Clopidogrel
108 Heparins including low molecular weight heparins.
i
DERM A TO LOG IC A L M E DICIN ES
Antifungal
109 Miconazole
1 10 Ciotrimazole
I
Antiinfective
I I 1 Framycetin sulphate
1 12 inser sulphadiazine
1 I j Betamethasone dipropionate
Antiinflammatory
I 14 C iobetasone
I 15 C’obetasol.
1 16 Gamma Benzene hydrochloride
Scabicides
117 Benzyl benzoate
disinfectants and antiseptics
118 Giuiaraldehyde
DIURETICS
1 19 Mannitol
120 Spironolactone
121 Amiloride
122 Triamterene
Disinfectants
154 Pilocarpine
155 Timolol
PSYCHOTHERAPEUTIC MEDICINES
Medicines for psychotic disorders
1 56 Chlorpromazine
1 57 Haloperidol
Medicines in depressive disorders
158 Amitryptiline
159 Fluoxetine
160 Imipramine
Medicines in bipolar disorders
161 Lithium carbonate
Medicines in anxiety
*
162 Alprazolam
MEDICINES ACTING ON RESP.TRACT.
Anti-asthma medicines
163 Beclomethasone dipropionate
164 Salbutamol sulphate
165 Salmeterol
166 Theophylline compounds
Anti-tussive
167 Codeine
168 Dextromethorphan
VITAMINS AND MINERALS
169 Calcium salts
170 Multivitamin combinations.
171 Nicotinamide
172 Pyridoxine
173 Riboflavine
174 Thiamine
175 Vitamin A
176 VitaminDj (ergocalciferol)
OPTION B: LIST 2
SUPPLEMENTARY LIST OF DRUGS AND THEIR THERAPEUTIC CATEGORIES FOR
RIGOROUS MONITORING OF PRICES
I.
Anti-bacterials: ( Penicillins like Amoxicillin-clavulanic acid, piperacillin. Cephalosporins like
cefoperazone, cefixime, cefepirome, cefhidir, quinolones like gatifloxacin, levofloxacin,
monobactams like aztreonam, carbapenems like imipenem etc)
11.
Analgesics and Non-steroidal anti-inflammatory drugs:
(e.g. COX-2 inhibitors and others)
III.
Drugs used in Rheumatoid arthritis: (Leflunomide, etc)
IV.
Antiallergics : (Fexofenadine, Loratadine, etc)
V.
Anticonvulsants (including gabapentin, lamotrigine, topiramate, clobazam, and others)
VI.
Immunosuppressives
Azathioprine, Ciclosporin, etc.
VII.
Cytotoxic medicines i Bleomycin. Busulphan.Cytosine arabinoside.Danazol, Flutamide.
Hydroxyurea, Pac I isave i etc)
VIII.
Antiparkinsonism medicines like Levodopa-carbidopa. Bromocriptine,Piribedil)
IX.
Medicines affecting coagulation
Coumarin derivatives
X.
Antihypertensives: (Beta blockers like carvedilol etc, calcium channel blockers like
nifedipine, sodium nitroprusside. ACE inhibitors like lisinopril, ramipril, other Angiotensin,
receptor antagonists, and others)
XI.
Diabetes mellitus: (Repaglinide. Rosiglitazoine, Acarbose,etc)
XII.
Immumnologicals Combinations of DPT with Hemophilus/Hepatitis
Varicella vaccine.
XIII.
Gastrointestinal medicines: (Proton pump inhibitors, drugs for H.pylori)
XIV.
Medicines affecting -.he respiratory' tract: (antiasthma medications like Budesonide,
Fluticasone. Ipratropium. Montelukast. etc)
XIV. Psychotherapeutic medicines (newer sedatives, newer antidepressants, new antipsychotics)
XV. Solutions affecting water, electrolytes.
I
XVI . Vitamins (all combinations of vitamins. Methyl cobalamin. Calcitriol)
— C
—
14
product patent regime they can serve another useful purpose in terms of manufacturing
certain patented drugs required to meet emergencies through the
grant of compulsory licence.
For strategic reasons it is essential that these PSUs continue to play an important role in
future. Their continued survival can be ensured incase some kind of purchase preference
based on the NPPA approved prices is accorded to them.
A list of drugs manufactured by the PSUs alongwith prices (to be certified by
NPPA)would be prepared for supply to Government. . All departments/hospitals of
Central Government purchasing these drugs from the market would be required to first
procure these from the PSUs at prices approved by NPPA .
A Coordination Committee in the Department of Chemicals and Petrochemicals would be
constituted to sort out various issues pertaining to the pharma PSUs. (Comments by
Health/NPPA/ESIC/Raibways/Defence)
19.
Consumer Awareness
Consumer Awaieness Campaigns through print and electronic media on price fixation ,
revision , use of generics including consumer education and empowerment will be carried
out on a sustained basis for which Government will provide adequate budgetary resources
A dedicated website will also be created which would all possible information about
drug prices and related matters. In addition to English language publicity would also be
carried out in other Indian languages. State governments would also be involved with this
work.
Inorder to address various grievances and public complaints about overcharging , quality
, availability etc the Helpline set up by Consumer Affairs Department would be made
use of.
(Comments by Health / Consumer Affairs)
20.
Schemes for Providing accessability of drugs to the Poor (BPL families)
About 26% of India’s population is estimated to live below poverty line .There is very
poor accessability of drugs to this population and even low priced medicines become
unaffordable for them.
Some schemes by Central Government and State Governments are already in existence
for these people but these have had limited impact due to lack of resources and
seriousness on the part of different players. National Common Minimum Programme
clearly stipulates that Special attention would be paid to the poorer sections in the matter
of health care’ . Apart from addressing the general issue of healthcare it is essential to
ensure that essential drugs are made available to these people free of cost. No single
scheme can address this subject. There have to be a host of schemes at the Central and
State levels for the achievement of this objective. Some of the schemes are as under-
a) Rashtriya Swasthya Bima Yojna for BPL familiesPublic health system in India has a limited reach. Existing health insurance schemes have
not become popular in India for various reasons and are estimated to cover only 3% to
5% of the population and much less of the BPL segment. As a result of this a vast
majority of the population have to bear expenditure which is out of pocket on health and
purchase of medicines. Some of the reasons for non popularity of the health insurance
schemes are the unregulated environment, unaffordable premiums ,non promotion of
schemes, inadequate supply of health services in 27 the rural areas etc. This is a peculiar
problem (and a serious one) in India as population in most other countries is largely
covered by a public health system or a health insurance policy. The National Common
Minimum Programme of the Government envisages a National Health Insurance scheme
for the poor families. Universal Health Insurance Scheme was announced by
15
Government in 2003 .BPL families were given a subsidy of Rs 200 , Rs 300 and Rs 400
per annum depending on the size of the family. However the scheme remained a non
starter and as per
the report of National Commission on Macroeconomics and Health only about
34000 BPL families were covered upto 31st January, 2005
A new scheme by the name of ‘ Rashtriya Swasthya Bima Yojana’ is proposed to be
launched in the country for the BPL families.
Some of the important features of this scheme would be as follows:i. Scheme to be implemented in a phased manner. Initially
scheme to be launched on a pilot basis in some districts of
the country (2 in each state). Based on the experience
gained it would be extended to all families below poverty
line throughout the country.
ii. Government of India to pay full cost of the premium amount
for all BPL beneficiaries
iii. Scheme to be implemented by the four public sector
insurance companies in the country.
iv. Beneficiaries to be extended benefits on the basis of
BPL/Health cards issued to them by the States
v. Benefit of hospitalization (upto Rs 15000) and for medicines
as outpatient (Rs 5000 ) per annum per family to be made
available
vi. Each Insurance company would shortlist chemist shops
upto PHC level/ taluka level. A certain number of BPL
families would be assigned to each selected chemist shop
vii. f) Chemist shop will maintain complete account of the
medicines taken by the BPL persons and send the same to
insurance companies from time to time.Computerised
statements should be prepared for transparency in the
account.
viii. g) BPL family can approach any government doctor in the
area . Based on the prescription of the government doctor
the BPL card holder can approach the authorized chemist
shop for obtaining medicines. He would be supplied
medicines free of cost.
ix. The chemist would send the bill to the concerned insurance
company which would reimburse him for the amount of the
medicines purchased by the BPL family
x. The entire insurance premium on account of the BPL
families would be paid by Government to the insurance
companies Medicines to be provided based on prescription
by government doctors.
xi. From the 3rd year of operation of the scheme it would be
suitably revised and extended to all parts of the country.
(26% of population is considered to comprise of the BPL
segment, which is over 5 crore families. Insurance cover would
be for each family irrespective of the size of family , premium
would be also per family basis - indicative amount indicated by
the insurance companies is Rs 550 per family per annum . This
come to approx. Rs 2750 crs per annum when the scheme is fully
implemented after the first two years of trial period. During this
period only 60 of the 600 districts would be covered which may
be taken as 10% coverage, hence the cost during the first two
years may be taken as approx. Rs 200 crs .The source of funding
would be the health cess)
16
(Comments by Revenue/Health/Insurance/States)
b) National Illness Assistance Fund, State Illness Assistance Funds & District Illness
Assistance Funds (for people below poverty line )
The Central Government under the Ministry of Health and Family Welfare operates the
National Illness Assistance Fund (NIAF) through which financial assistance is provided
to states for the medical treatment of people living below poverty line and other poor
families. Out of this fund assistance is provided to States upto 50% of their share in the
State Illness Assistance Fund (SIAF).Also revolving funds have been set up in some of
the leading Government Hospitals for providing financial assistance to BPL families upto
Rs 50,000. A Rashtriya Arogya Nidhi has been set up for this purpose. Some states are
making good use of these schemes for the BPL families while some have not yet
set up the State Illness Assistance Funds.
Inorder to ensure that the benefit of these funds is passed on to a larger section of the
poor people, following steps would be taken:
i. Larger allocation would be made towards National Illness
Assistance Fund (NIAF).
ii. State Illness Assistance Funds (SIAFs) would be set up in
all states with financial assistance from Central Government.
iii. Revolving Funds for BPL families would be set up in all the
Central Government hospitals .
iv. States would also be asked to set up revolving funds in all the government hospitals
for free treatment of BPL families.
v. Inorder to increase the reach of poor people to these funds
District Level Revolving Fund would also be maintained
The quantum of the District Level Revolving Fund would be Rs 1.00 crore. Initial
amount of Rs 1.00 crore would be provided by the Central Government, thereafter it
would be shared on 50:50 basis between the Centre and the States. The fund would be
replenished as soon as the level of fund in a district falls below Rs 50 lacs. This fund
would be managed by a Committee headed by the District Collector with Chief Medical
Officer of the district as the Member Secretary . Some public representatives may also be
coopted on the Committee. Detailed guidelines with simplified procedures for operating
the fund would be issued by the Health Department.
vi. Wide publicity would be given to the availability of funds at the district, State and
Central levels.
Proposed allocation -Rs 1000 crs (source of funding- health cess) (Comments by Health
/Planning Commission ZExpenditure/States)
c)
Rajasthan Model of Medicare Relief Societies to be replicated
In Rajasthan Medicare Relief Societies have been set up in all the government hospitals
at State, Divisional, District and sub— division level for the purpose ofi. better maintenance and upkeep of the hospitals;
ii. providing cheaper medicines to the common man through
outlets known as life-line fluid stores opened within the
hospital premises.
iii. providing medicines free of cost to BPL families.
These Medicare Societies mainly comprise of the doctors in the hospitals Their source of
income is primarily the user charges levied by them for the services provided in the
hospitals. Through
these medicare societies several critical medicines, injections, antibiotics, IV Fluids etc.
aie purchased in bulk through open tender from the manufacturing companies and sold
through the lifeline fluid stores in the hospital premises. As a result the prices are reduced
considerably and some of the medicines are
sold at prices as low as o r even lower than 50% of the prevailing market rates. An
example is the Intra Veinous(I V) fluid , a bottle of which is being sold to patients
17
between Rs. 10 to Rs. 11 as against its ceiling price of Rs. 17/-. Running of the Stores is
contracted out and these are generally open all the 24 hours.
All states would be advised to replicate this model which would help make available
critical drugs at affordable prices to the common man and to provide medicines free of
cost to BPL families.
Comments by Health/States
d)
District level Drug Banks
In-order to increase aceessability of medicines to the BPL families efforts would be made
to establish a District Drug Bank at each District level . Considering that there are 600
districts in the country an equal number of drug banks would be set up in a phased bank.
These banks could be managed by Red-Cross
Societies , Medicare Societies or such other charitable bodies having linkage with the
District Administration/ district level hospital .Various manufacturers would be
encouraged to donate
generously to these drug banks- efforts would be made that they adopt one or two
districts foi this purpose . Such drug donations would be made eligible for tax exemption
under the corporate tax.
(Comments by Health/ Finance/States)
21.
Health Cess for funding Schemes for PoorA health cess of 2% would be levied on various central taxes on the lines of education
cess which is likely to provide approx. Rs 6500 crores to the Government. This amount
is proposed to be
spent primarily on schemes meant for the poor people . Inorder to ensure that the
money collected from the cess is not diverted to other areas it shall be kept in a separate
non- lapsable fund.This fund may be managed by an independent body specially
designated for this purpose . It may be called the National Public Health Board . The
broad areas on which this amount may be spent are i. to fund suppl y of medicines through the Rashtriya Swasthya
BimaYojana.
ii. to fund the subsidy scheme for anti-cancer drugs .
iii. to fund the expansion of ART centres for additional AIDS
patients throughout the country . (through NACO)
iv. to provide additional funds for National Illness Assistance
Fund / State Illness Assistance Funds / District Illness
Assistance Funds and revolving funds .
v. provide funds for technology upgradation for
implementation of schedule M for GMP in pharma SMEs .
vi. to start a scheme for awareness generation for drug prices
and related aspects.
OR
In case there is difficulty in levying of health cess, Government
may provide funds amounting to Rs 6500 crores which is
equivalent to 0.02 % of the GDP out of the general budget.(
present spend on health only 0.9 % of GDP-as per NCMP it is to
be raised to 2 to 3 % of GDP).
(Comments by Revenue/Health)
22.
Encouragement to Community based organisations in the Health Sector
Certain community based organizations like LOCOST and SEWA (Self Employed
Women’s Associations, Ahmedabad) are engaged in providing medicines to the needy at
low prices,
preventive health care, health insurance etc. Encouragement would be provided to more
such bodies to function in the area of healthcare services.
18
23.0
Human Resource Development in Pharmaceutical SciencesNational Institute of Pharmaceutical Education and Research (NIPER), under the aegis of
Ministry of Chemicals and Fertilizers, Government of India is an Institute of National
importance by the act of Parliament is engaged in training the human resources in the
field of Pharmaceutical sciences. In a
short span of time, NIPER has created a brand name for itself.
The post-graduate students of pharmaceutical sciences and pharmaceutical management
of NIPER are in great demand and till now there is hundred percent employment. On
several forums there are demands for more NIPER-like institutes in different regions of
the country. Inc ian Pharmaceutical Alliance predicted
that to double the pharmaceutical exports by 2010, there is need for highly trained
manpower of one thousand per annum for the next five years and demanded the GOI
should start at least ten more NIPER like Institutes. In 57th Indian Pharmaceutical
Congress held iccently at Hyderabad a demand for more NIPERIike Institutes was made.
Government of India has received requests from some State Governments showing their
interest in setting up of such institutes. Some of the probable sites for
setting up these Institutes could be Ahmedabad, Hyderabad, Kolkata ,Bangalore , and
Guahati (Assam). These institutes would be started on the lines similar to the Indian
Institutes of fechnology.(IITs) World over, pharmaceutical scientists are working on how
to decrease the cost of drug discovery and development, increase the safety and efficacy
of drugs. The aim of pharmaceutical research is to reduce the duration of the preclinical
phase of drug discovery and development, decrease the attrition rate and cost of the
clinical trials.
To achieve this India needs to strengthen the areas viz., in silico drug design,
computation and simulation of biological systems (normal and pathologicial) for better
understanding ofdrug and macromolecule interactions, early prediction of
pharmacokinetics and toxicity, pharmacogeneomics, stringent quality control and
impurity profiling solid state characterization of APIs and newer drug delivery systems.
To be front run ler in pharmaceuticals R&D which is knowledge based, India needs
highly trained I uman resources in the area of medicinal chemistry, computational biology
in silico drug design, in vivo pharmacology, regulatory toxicology, pharmaceutical
analysis, formulation, clinical trials, intellectual property protection, drug regulatory
affairs and phai maceutical care.
Simultaneously, scientific validation and standardization of the procedure followed in the
traditional med cine of India need to be undertaken on priority base.
(Comments by . )ST/DBT/CSIR/Health/Ptanning Commission)
24.0
Research and Jevelopment - A Fiscal Incentives
India is emerging as the most favoured destinations for collaborative R&D
bioinformatics, contract research and manufacturing and clinical research as a result of
growing compl ance with internationally harmonized standards such as Good Laboratory
Practices (GLPi, current Good Manufacturing Practices (cGMP ) and Good Clinical
Practices ((iCI )
With the application of product patent in the case of pharmaceuticals it is imperative for
the Indian indu try to accelerate its efforts in R&D in this sector. The present level of
spend on R&D (about 5% of turnover) is much lower as compared to most of the
developed com tries (15 to 20%)
With a view to encourage R&D in this sector it is essential to provide suitable incentives
to industry. At he same time it is also necessary that the incentives are made use of by
those units which are genuinely engaged in R&D. .As such the required incentives would
be made available with some safeguards to ensure that these are available to the
deserving cases only.The incentives available would be as undera)The benefit o ' 150% weighted exemption under section 35(2AB) to be continued till
31st March. 20 5
19
b) Section 35(2AB) to be extended to depreciation on investment made in land and
building for dedicated research facilities, expenditure incurred for obtaining regulatory
approvals and f iling of patents abroad and expenditure incurred on clinical trialsin India .
c) Reference Si indard ( sample under test) would be exempted from import duty
e) Refence boo.cs to be imported for R&D would be exempted from import duty.
f) Presently the. e are 101 specified instruments (list 28) required for R&D purposes
which are exen pt from imoport duty. With the ever changing requirements new
instruments arc required to be imported .These instruments based on the certification of
DSIR would al: o be exempt from import duty.
The fiscal incei.lives are at present only available up to 31SI March, 2007. Since R&D
activity has lo I e carried over long periods of time, fiscal incentives would be granted
over a longer period of time extending upto 10 years ie upto 31st March, 2015.
The above ince itives would be available to such units which fulfill
the following conditions-
a) The unit should be prequaiified and registered with Department & Scientific and
Industrial Research (DSIR) as R&D centre..
b) The unit should submit a statement certified by the Auditors showing the total expenses
incurred on R&D.
c) In case of cla ms for clinical trials, the unit should submit approval obtained from the
Drug Regulatory Authority for carrying out the trials and certificate by the CEO or the
Auditor for completion of trials.
d) In case of cla ms for patent filing abroad, the unit should submit relevant documents
(official receipt, etc) showing the filing expenses duly certified by the CEO or the
Auditor.
e) In case of cla ins related to land and buildings, the unit should submit a letter signed by
the CEO conllr ning that the claims pertain to facilities used exclusively for R&D.
B .R&D
Intensi ve Companies (Gold Standard Companies)
The Pharmacei ical Research and Development Committee headed by Dr R A Masheikar
in its report submitted to Government in November, 1999 recommended that R&D
intensive comp mies fulfilling certain conditions should be given price benefits for the
drugs under DI CO . It specified certain
norms in this regard and termed these as the gold standards.Since six years have elapsed
since this repor was submitted it has been considered proper to revise these norms
The revised noi ms are as under a) Invest at lea.: 3% of the annual sales turnover on
R&D or Rs 50 crores per annum, (average of last 3
years)whichcvc is higher on research facilities .
b) Employment of at least 200 scientists in India ( MScs
or Phds emplox ed at least for one year).
c) Own and op; rate manufacturing facilities in India
which have bee i approved by at least two reputed foreign
regulatory agencies (US, Europe, Japan, Canada, Australia,
Israel, Souili A rica etc )
d) Have filed a least 10 patent applications in India
based on res ear h done in India Companies fulfilling the above norms would be
eligible for the jeneflt o f 200% weighted deduction under 35(2AB) till 31st March, 2015
Additional incc itives under price control measures may also be considered to such
companies by i epartment of Chemicals and Petrochemicals.
However inorder to be eligible for any of the additional incentives such companies would
be expected io ulfill the following norms a. The unit should submit a statement signed by HRD/R&D chief or CEO certifying the
number of scicatists employed through the year.
b. The unit shot.Id submit a statement certified by the CEO and
the Auditor iha. it has invested at least 3 per cent of the annual
20
sales turnover c r Rs 50 er (average of the last three years)
whichever is hi -her, on R & D.
c. The unit shouid submit certified true copy of the approval
granted by the Drug Regulatory Authority of the specified
countries approving the manufacturing facility for export to their
country.
d. The unit shouid submit particulars/documents evidencing
patents filed in india
The inter-depai menial Screening Committee constituted by DSIR
may further rec unmend additional safeguards to be taken for
making availab e fiscal incentives to various companies.
(Comments by DST/CSIR/DBT/DSIR)
c
/
Pharmaceutic: I Research and Development Support Fund (PRDSF)
At present, the ’harmaceutical Research and Development Support Fund (PRDSF) has a
corpus of Rs. 1 0 crores (where only interest income is available for spending) is utilized
for funding R&D projects of Research Institutions and industry in the country. It is not
adequate to me t the present day and the
emerging icqui ements of this sector. It needs to be sufficiently augmented over the next
five years, li ha ; been decided to convert it into an annual grant of Rs. 150 crores, and
thereafter it wo ild be suitably increased further in a phased manner over a period of next
five years Prior ty would be given for R&D in case of diseases which are endemic to
India like malaiia, tuberculosis,hepatitis-B,leishmania(kala- azar),HIV/AIDS etc. (
Comments ! v Health/DST/DBT/Expenditure/Revenue/Planning
Commission
25. Development of O. phaned Drugs
Several drugs li.ive been discovered and developed by Central Drug Research Institute
(CDRI) and oil.er organizations in the past which were granted marketing approval by the
Drug Controlle General of India . However some of these could not be marketed due to
one reason or tl.e other. Such drugs would be
identified and eiforts made to further develop and launch these in the market.
(Comments / -v. ^ST/Health/CDRI/NIPFR)
26.
Scheme of Im. rest Subsidy for implementation of Schedule M of Drugs and
Cosmetics ; ai s for Good Manufacturing Practices
A dedicated lui d would be created for providing interest subsidy (5 percent) on
borrowings to miall scale/medium pharma units going in for Schedule M
implementaiioi for GMP for Drugs and Cosmetics Rules. This assistance would be in
addition to any . )ther financial assistance that may be available to the SSI pharma units
from Central or State Governments. While SIDBI would be the nodal agency for this
scheme, otli ’anks / financial institutions would also be involved in this work.
Promotional ac ivity to motivate industry to adopt schedule M would also be undertaken
from this fund vith the active involvement of Ministry of Health and Family Welfare and
the States. A pl m scheme would be prepared in this regard (Comments by
Health/SSI i- in. mce/Ptanning Commission)
27.
Regulation d Drugs under Narcotics and Psychotropic Substances Act ,1985
In order to c'lc lively control the abuse of narcotic drugs and psychotropic drugs in the
country the Na: cotics and Psychotropic Substances Act, 1985 was enacted . There is lack
of clarity about regulating the sale and use of certain drugs which contain regulated
quantities ofna colic drugs and psychotropic
substances a 1. gaily permitted. Through a notification issued on 14th November, 1985
such diugs \\ci exempted from the applicability of the NDPS Act. However such drugs
are manufactured and regulated under the provisions of the Drugs and Cosmetics Act
21
,1940 and the Drugs and Cosmetics Rules,1945. Several instances of misuse of these
drugs taking ad eantage of the loopholes in the existing regulations have been noticed in
the past. In order to prevent misuse of such drugs as intoxicants Department of Health
and Family W Ifare would evolve an effective mechanism under the provisions of
Drugs and Co. metics Act ,1940. (Comments by Health/ Revenue/Home )
28.0
Settlement Cl emission —
A large numbei of cases of overcharging incase of drugs are detected where the
overcharged an .ount is recovered from the concerned companies. Often recovery of the
amount is conk sted by the companies leading to protracted litigation and court stays.
This holds up r covery of substantial dues and long drawn court cases. There is need to
work out a mec.ianism under which this issue can be tackled.
In case of some other recoveries of government dues like Income-tax arrears ,
Government have constituted a Settlement Commission which is authorized to decide the
contested
recoverable am )unt in a summary manner after hearing both sides. This helps in faster
recovery ol the dues and avoids unnecessary litigation.
A similar system needs to be put in place in the recovery of disputed overcharged amount
of cases which ire under litigation .
All ongoing co irt cases would also be brought before the Settlement Commission and
effort made to : rrive at some workable settlement. Amount so recovered would be put in
a special fund t > be
created for this purpose to be called the Price Monitoring and Public Awareness Fund.
Most of the c:i s of old dues of Drug Price Equalization Account (DPEA) under
DPCO, 1979 ;i c being disputed by industry and these are under litigation in various
courts in the ci intry .Efforts would be made to settle these complicated cases through a
One-Time Set. ement scheme on the lines of
Amnesty sc hen es under Income tax .
While framing he Terms of reference for the Settlement Commission suggestions of
industry would be kept in view. (Comments by Revenue/Health/NPPA)
29.
Drug Price
.litoring and Awareness Fund (DPMA Fund)
A fund under I ?CO, 1979 has been set up by the; name of Drug Price Equalisation
Account (DPI: .) wherein amount recovered on account of overcharging on the
formulation
ilk drugs sold by companies prior to the DPCO of 1987 as per the
assessment ul'i e Department of Chemicals and Petrochemicals is deposited . This fund
is administci. < is a public account by the Department of Chemicals and Petrochemicals .
With the fornu. on of the Settlement Commission the scope of this fund
would be enlar. ed so as to accommodate overcharged amount recovered by NPPA under
the DPCO,, KA and any subsequent cases under the DPCO/ Act to be enforced under the
new policy.
NPPA would a q be authorised to levy such user charges , fees etc that may be permitted
by the Gove:m ent for the services rendered by NPPA.
This fund v
1 be housed in NPPA but it would be operated by an Empowered
Committee
led by Secretary, Chemicals and Petrochemicals. Sources of Funda) Any amouni by way of overcharging or otherwise recovered
under any DPC ) by Department or NPPA
(NPPA on an l verage recovers Rs 15 crores of
overcharge, / a> ount from drug companies per year . Most of this
amount is in l'n nation and there is uncertainty about its quantum
andfinal re -n /y .Settlement Commission can help finalisation
of the amoin /1 id enable it to be spent on certain drug related
activities. Th <. mount is presently deposited in the Consolidated
Fund ofIndi )
b) User chai
, fees etc levied and recovered by NPPA on the
22
services render d by it
Application of FundThis fund u oul I be utilized for a)Expenditurc t n public awareness about drug prices of generics,
comparative dr ig prices , banned drugs ,misbranding , facilities
given by gover .ment for different categories of patients or any
other aspeci of public interest through the use of print and
electronic med i
b)Expenditm e or operating and strengthening of the price
monitoring me nanism of NPPA on a continuous basis
c) Computerisat on of NPPA and offices of State Drug Controllers
d) Online elcctr >nic data filing system by the State Drug
Controllers and industry
e) Fund studies m the drug prices production and availability of
drugs , impa ,t ( (’patents on drug prices ,studies/data required(in
India or abroad for negotiation of prices of patented drugs and
various other a pects pertaining to drugs and drug prices
^Funding such incidental activities which may be instrumental in
achieving the h oader objectives of this policy.
(Comments a ’PPA)
(Based on /. . rug Policy announced by the Central
Governmem , 29.03.1978 "The Drugs (Prices Control) Order,
1979 was , / d on 31.3.1979 superseding the then existing
DPCO, 1971). I nder DPCO, 1979, with a view to regulating the
equitable diru . union of an indigenously manufactured bulk drug
specified in die First schedule or the Second schedule and
making it avad.ible at fair price, maximum sale price ofthe bulk
drugs were ii.\ / and promulgated by the Government during the
period 1980 1 <7. The Government had also powers tofix the
retention pi r md the pooled price/common sale price for the
sale ofindividu d bulk drugs, and imported bulk drugs specified in
the First Sc/ cn de or (he Second Schedule. The Government
during the / o/. d 1980-1987 also promulgated retail Prices/leader
prices of a iium >er offormulations in the Third schedule. As per
the provisions ' Para 17 ofDPCO, 1979; the manufacturers,
importers o: ., tributors were required to deposit the excess of
the common
"mg price or, as the case may be, the pooled price
over his retc ,// n price and also the amount determined under
sub-paragropi. 2) ofpara 7 into the Drug Prices Equalisation
Account. As (lei the provisions ofthe Para 7(2) ofDPCO, 1979,
where a mamip cturer ofa formulation utilized in his formulations
any bulk drug < (her from his own production or procured by him
from any other ource, the price ofsuch bulk drug being lower
than the pri < lowed to him in the price ofhis formulations, themanufacturer was
required, on c. umd, to deposit into the DPEAthe difference between the price of bulk
drug allowc. 11 his formulations and the actual procurement price ofthe bulk drug.
Out of the 3 (5 ulk drugs underprice control under this DPCO, the Government
computed Pm hi ties in respect of 47 bulk drugs only covering 172 cases and
communicai ’ i ie same to companies concerned by way ofdemand notices till the
Interim Stay di id 30.6.1997 granted by the Hon ’ble Bombay High Court
restraining dr i overrimentfrom issuingfresh notices to the drug companies callingfor
information i\\ nredfor determining liabilities. However, most of these companies filed
writ petitions /7 the different High Courts and did not bother to deposit the DPEA
liability. At o - limited part of the DPEA liability could be recovered and that too in most
23
of the cases on he directions of the various Courts. The DPEA liability cases pertain to
the period we/ 4.1979 to 25.8.1987 and thus are very old. It is understood
that as per ex is / ng accounting procedures, the companies are required to maintain
recot ds for op. riod of 15 years only. It is, therefore, doubtful whether the companies
would be hcivm ' records for this old period. Considering the prolonged litigations, and
the Governmen stake in DPEA under DPCO 1979 being very large, it would be
worthwhile to announce a one time settlement scheme to be implemented through a
Settlement ('on mission)
30.0
Pharma Parks SEZs for Pharma industry In order to cna! le India to achieve a leading position as the Drug Maker of the World it
is essential that a World class infrastructure is provided for the accelerated growth of
the industry. Ai ded to this are the environmental concerns due to difficulties in
hazaidous wasi disposal by some of the bulk drug units. In order to provide the required
infrastructui e i. is essential to have a scheme where Central Government, State
Governmems a d industry are participants. A special scheme for setting up
phai maceuiical parks in the country (separate fo r bulk and for formulations ) in the next
5 years is propc sed. This would be broadly on the lines of Scheme for Integrated Textile
Parks.
a) This scheme could be based on public-private partnership model
b) Each park w mid be set up in a minimum area of 250 acres
for bulk and 10) acres for formulations . It would be expected to
have about 50 i > 100 units, investment of 1000 ers to Rs 2000
ers and likely e nployment of about 20,000 persons.
c) Scheme io b implemented through SPVs (Specia 1 Purpose
Vehicles) with ndustry Associations to be the main promoters
d) An MOI wi I be signed with a leading professional body/
consultant m
as Project Management Consultant
e) Where ar; S! Z is to be set up the minimum size criterion for
pharma SEZs \ ould be 50 hectares for the next 3 years . This
would encoum c quick setting up of such parks and for
demonstrati hi ifect. After a successful take-off of the scheme
minimum size may be increased suitably
All environmc tai approvals in the case of pharma parks would
be granted ;' i;. ? State level only
(Comments
lecillh/DIPP/Commerce/Environment)
(Governmem A, v recently passed an Act to facilitate setting up of
Special Eco! . .): ic Zones in the country. Some SEZs for pharma
have been s ,//. ioned in a few states. There is need to have
more ofsue s momic zones in the country. It is estimated that
an SEZ in a.. j eci of 50 hectares would require an investment of
Rs 100-120 I ■' es on land and development. It would be able to
attract an inw. ment ofRs 1000 crores and would be able to
generate ex/ v x worth Rs 2000 crores and employment ofabout
6000 peopb L oking to the attractive tax concessions and good
infrastructui / < railable in these parks these are becoming
popular wit
industry).
31.
Greater T1 .1i on Pharma Exports
Pharmaceun. .ixpoit Promotion Council (Pharmexcil) is the sole agency authorized for
issuance ol
stration-cum- Membership Certificate to exporters of Drugs and
Pharmacem
. Pharmexcil, during the last over one year of its formation, has
successful!; co npleted various projects, particularly sponsoring full-fledged trade
delegations > irious countries
24
Future grow th ( f pharma sector would be largely driven by exports to other countries.
Although expo: is of pharma products from India are growing at a healthy rate there is
need to acceler; le this further in view of the vast potential existing in some of the
countries
Following ' cp: are envisaged to be taken in this regarda) Suitable measures would be taken to tackle the non tariff barriers to exports of
pharma pi ducts in various countries through consistent efforts and greater interaction
with the concer led agencies of the focus countries
b) Africa , l ab . America , ASEAN and CIS countries have been put in the category of
focus countric by Commerce department. These would continue to get special attention
for the purpose of exports.
c) The Soul . A ian Free Trade Area (SAFTA), an agreement between Saarc countries
comprising of 1 idia , Pakistan , SRI LANKA, Bangladesh , Nepal, Bhutan , and Maldives
is scheduled io come into force on January 1, 2006. It will be fully operational by 2016.
The pact holds luge potential for intra -regional trade growth which is presently only
US$7 billion (only6% of the total external trade in the region which is US$350 billion)
Pharmacem icaI; has a substantial potential in the intra-regional trade of the area. A
detailed stu \ \ ould be undertaken of this potential A study to determine the market
potential foi ph irma products in these countries and their registration procedures
/requiremei is \ ould be carried out soon.
d)Some more c entries with good potential namely GCC, European Union , Japan
and Korea would also be paid special attention looking to the big potential for pharma
exports in these.
An action pkm ncluding a study of the pharma export potential in these countries would
be carried i . i . improve exports of pharma products to these countries .
e) Internal ) i 1 meets/conferences/seminars with potential countries would be
organized on a xegular basis in India and abroad f)Apart from the existing formal
arrangemen s i r export of drugs there is> an urgent need to have a government-industry
standing f rui for each of the high potential markets comprising of the key industry
players active i i that area and concerned government departments.
g)Quality is an important issue with the importers from India . It would be worthwhile to
lay down guide i nes regarding the consignments of pharma products being exported
outside India./’ :system of registration for quality products would be worked out in
consultation w: h industry.
h) Exports i i be exempted from service tax.
i) Pharme 1 w mid be suitably strengthened to meet the future challenges of export
market. It
I be assisted financially and otherwise for opening warehouses/ offices
in some of me < ountries to help the Indian entrepreneurs there , for an online library,
organizati o exhibitions in various countries, and
brand bm .a activity . (Comments by Commerce/Pharmexcil)
32.
Pharmacc ti I Distribution-Retailing
Pharmacem t distribution system in India needs much to be desired as retailing in India
is highly un n g. adzed . With increasing concern for healthcare and to ensure quality of
medicines
d retailing system can play an important role. Proper storage , cold chain
and organ i. h tailing would be encouraged .
(Comments . lealth/States)
33.
Pharmacc. tic 1 Advisory Forum
Inorder to haw a meaningful dialogue amongst all stakeholders on various issues
concerning
y the Pharmaceutical Advisory Forum constituted under the
chairmans!;m Minister, Chemicals and Fertilisers would play an important role.
Summary o!' a posed Revenue and Expenditure (Tentative Estimates)
25
OPTION 1 (health, cess 2%- to be kept in a separate non- lapsable public account to be
managed by a sep; at body) Revenue items
a) Health Cc s c f 2% on Central Taxes (like Education Cess) Rs 6500 crs ( a. sumed to grows at 10% per year)
Less Loss due to reduction in Excise duty from 16% to 8% Rs 1000 crs ip| rox.
Net Reveni. -!■ s 5500 crs approx.
Over 5 year peiiod - 5500x5 (with 10% increase) = Rs33,300crs
b)Overchai ?d amount recovered by NPPA -approx. Rs 15 crs.
per year (to >e •ut in a separate public account fund with NPPA)
Expenditu it msa) Free med in s for poor through health insurance or otherwise
- estimated > 1 s200crs.in the first two years of trial run in about
60 districts . the country - 2 per state -to increase susequently
to approx. Rs 3 )00 crs per year when scheme is fully
implements
b) Public Pr al. partnership for cancer drugs including subsidy Rs 100 crs pi ix in the first year, to increase in the subsequent
years as the scl erne picks up..
c) Contribut jn o National Illness Assistance Fund(NIAF), State
Illness Assi Lu; ■e Fund(SIAFs) and District Illness Assistance
Funds(DIA
—Rs 1000 crs per year
d) Anti HIV AIDS drugs(through NACO) - Rs 1000 crs approx
per annum.
e) State Moi ■' oi i ng Cel Is (50 lacs per state, for 20 states) - Rs 10
crs
f) PubIic Av ire less Programme - Rs 25 crs per year
g) Addition; N PERs - Rs 50 crs in first year (total exp. Likely Rs 500 crs i. »r: NIPERS to be spent in 5 years)
h) Computei a: on of NPPA - Rs 5 crs in 2 years.
i) R&D Fun - Ls 150 crs per year (in place the
existing coi is fund of Rs 150 crs under DST)
k) Interest S \s ly for Implementation of Schedule M for GMPRs 10 crs in tio t year ,Rs 560 crs over a period of 8 years.
l) Phanna P
-Rs 100 crs in first year, (1000 crs for 25
parks in 5 \ i @ Rs 40 crs per park on the lines of Textile
Parks)
m)Drug De. ck ument Fund for Pharma PSUs - Rs 10 crs in first
year, (Rs 100 c rs in 5 years).
Since the e? x'i Jiture on some of the items would pick up over a
period of fe \ ars savings in any year should be put in a nonlapsable
account to I n anaged by a separate body so as to
utilize the s • ii gs in subsequent years
OPTION 2 ( Healt ; ss of 1%- to be kept in a separate nonlapsable fund)
Expected 1 . iue per year —Rs 3200 crs.(10% growth in revenue assumed) Revenue
over a period o 5 years- Rs 20220 crs.
Expenditu 1 ?ms
a)Free medi r. s for poor through health insurance or otherwise
- estimated 1 s 200crs. In th e first two years of trial run -to
increase su>
ntly lo approx Rs 3000 crs per year when
scheme is 1 llx implemented.
b)Public Pr ■ai partnership for cancer drugs including subsidy Rs 100 crs >pi >x. in the first year to be increase in subsequent
years as the scl me picks up
26
c)Contribui on o National Illness Assistance Fund(NIAF), State Illness Assistance
Fund(SIAF ) and District Illness Assistance Funds(DIAFs) —Rs 1000 crs per year
d) Anti HIV AIDS drugs(through NACO) - Rs 150 crs.
e) State Monitoi ing Cells (50 lacs per state, for 20 states) - Rs 10 crs
f) Public Aw are-less programme - Rs 25 crs per year
g)Addition; N PERs (total exp. Likely -Rs 50 crs in first year (total of Rs 500 crs for 5
NIPERS spraac over 5 years )
h) Computei isation of NPPA - Rs 5 crs in 2 years
i) R&D Fun - i s 150 crs per year ( inplace of existing corpus fund of Rs 150 crs under
DST)
k) Interestsubsi ly for Implementation of Schedule M forGMP Rs 10 crs first year ( 560
crs over a p io 1 of 8 years)
l) New Phar a 'arks (for bulk as well as formulations) -Rs 100 crs first year (1000 crs for
25 parks
' in
N \ ars @ Rs 40 crs per park as GOI investment -on the lines of Textile
Parks)
m)Drug De ek oment fund for Pharma PSUs - Rs 10 crs first year ( Rs 100 crs in 5
years)
The full text jf inis policy is also available at
http://chemi J nic.in
Response/c .n tents, views oe suggestions may be e-mailed at :
Response-p nm na@nic.in
For further e t Is or any clarification about New Pharma Policy
following oft .e s may be contacted:
Ms Satwani Rc idy,
Secretary, ep rtment of Chemicals & Petrochemicals,
Room No 5 1, AWing Shastri Bhawan,
Dr. Rajendr P asad Road,
New Delhi
0 J01
Phone: 233
6,23382467
Fax: 23387(
E-Mail: srec
3)nic. in
Shri Gurdia
gh Sandhu
Joint Secre
f
Pharmaceuticals Industry) & Chief Vigilance
Officer, De[ -rt tent of Chemicals & Petrochemicals
Room No.3- :
Awing, Shastri Bhawan,
Dr. Rajendi : asad Road,
New Delhi
.01
Phone: 233
1.
Fax: 23387: .
E-Mail: gss.
u55@yohoo.com
jspc.cpc@i
Shri Paresh
n,
Deputy Sec
y(PI)
Department ...
hemicals & Petrochemicals,
Room No.2 .
x-Wing, Shastri Bhawan,
Dr. Rajendi
usad Road,
New Delhi
;01.
Phone: 233 :
7,
Fax: 23383
E-Mail: pari
hri@gmail.com
27
http://www. ;e] ndubusinessline.com/2006/Q1/01/stories/2Q06Q1010208Q5QQ.htm
Pharma: Some agony, not mi ch ecstasy
Madhumathi D.S.
Bangalore , Dec 31
IF the domestic pharmaceu. a' ndusiry will remember the year 2005 as the watershed year of the patent
regime and sightings of gro h pportunities, it will also not forget the other heartburns that came along.
The much awaited pharma
/ is also yet to come out.
An issue like the MRP-base e\ aluation of central excise at 16 per cent hit the bread of small and mid
sized contract manufacturer 1 ie big fish had their own problems and agendas, such as fighting MNCs'
patent infringement suits; gcmg after new markets, tie-ups, acquisitions, most of the time with their eye on
the $ 60-billion generics ma ;et emerging worldwide in the next two years.
The year 2005 saw a major c small and mid-sized companies completing their upgrading to comply
with good manufacturing pi
js under Schedule M of the Drugs & Cosmetics Act. Even as they looked
ahead for good orders, the I..:-; -based excise duty regime hit their livelihood almost to 70 per cent,
according
1 to
‘ industry
\ sources
large companies froze a bulk of orders while many shifted production
bases to excise havens in tl e i .rth.
The notification of the MRP-.ta- d excise duty era, according to Mr Jatish Sheth, Secretary, Karnataka
Drugs & Pharmaceuticals M inc acturers' Association, became a major issue that snowballed into loss of
cash flow and turnover for n m smali and medium companies. He estimated the flight of capital and
business to mainly Himach; P; desh and Uttaranchal could be of the order of Rs 22,000 crore.
Larger players Nicholas Pir: na Glenmark, Unichem, Torrent Pharmaceuticals, Strides and Matrix Labs
went in for acquisitions and qi y buys in India and abroad. Bangalore's Strides Arcolab and Hyderabad
based Matrix Labs explored a n erger that would have created a seventh largest pharma entity in the
country, but called off the plan v ithin months.
Innovator companies Ranb y ' abs and Dr Reddy's Labs were slapped with patent infringement suits
from
Ranba;
- multinationals.
-- -------------------a me faced a slew of them, two from Pfizer over its generic version of
Pfizer's cholesterol-lowering itc vastatm, Lipitor, in the US market; and again over Pfizer's anti
hypertensive drug quinapril As: aZeneca pic went to court against Ranbaxy in defence of its ulcer drug
Nexium (esomeprazole), w: Je
ie oehringer Ingelheim moved to defend its prostate enlargement drug
against Indian giant's new d g pplication in the US.
The bird flu spreading to ne cc untries brought forth opportunities and issues of generic supplies for
companies such as Cipla, R nt ixy and Hetero Drugs. At stake is a huge market for Swiss major Roche's
patented drug Tamiflu.
The year also saw some m
r ivestments in R&D. Dr Reddy's Labs floated a new Rs 230-crore
triangular drug discovery ve '.u , Per. .-can Pharma, with ICICI Venture Funds and Citigroup Venture. Dr
Reddy's announced its tie-u w :i Dei .nark-based Rheoscience A/S to jointly develop and market a new
diabetes drug.
Bangalore-based ayurveda
\ r Himalaya Drug Co firmed up plan for a Rs 160-crore facility for pipeline
for*he re9u!
markets. Biotechnology and biopharmaceuticals major Biocon Ltd tied up
IO I I r-,
.i
r-,1
3
with IUS-based
Bentley
Pha (
euticais to co-develop an intra-nasal insulin spray. It is also pitching for
intellectual property assets
it- bankrupt US R&D partner Nobex. Its subsidiary/ciinigene, has»a
strategic tie-up with SCIRE
JS, which has plans to pick up a share in Clinigene.
Dedicated clinical trials com an es such as Quintiles, Pharmanet and Pharmolam have also entered the
country, which is emerging ; c abal destination for clinical and contract research.
28
All said and done, "2005 is noth ng to write home or cry about," Mr Sheth said. "The patent law has come
but no bomb has hit us yet, it h: s spurred R&D investments."
According to pharma consulian!, Mr V.R. Kannan, 2005 has mostly been a dull and ’status quo year'
although the pharma industry tu nover has grown 11 per cent to touch Rs 36,000-38,000 crore No meqa
brand is to be seen in 2006 eith
The growth rate started pick.ng up from September this year, rising sharply from a stagnant 2 per cent
until August to 26 per cent i. S< otember. Many segments such as antibiotics and anti-diabetics took a
beating due to a fragmentec, an i crowded field.
Though large companies pc ;tc negative growths, the flip side has been positive. India has been visible
for quality, growth and oppo :u. ty. An Assocham forecast estimates the pharma sector to touch Rs
60,000 crore by 2007.
http.7/www.hindu.com/2Q06
1 /* 3/sto:: 3S/20Q6Q1130499120Q.htm
Rethink the draft pharma po! y
The draft National Pharmac u* als Policy 2006 seeks to recognise the premier role of government in the
promotion of health care of ic eople, especially the poor. However, the means chosen may not be
really effective. It provides, amc ig other things, for the levy of a health cess of two per cent (similar to the
education cess) on "various C(
Ct ntral taxes to finance the supply of drugs for the Rashtriya Swasthya
Bima Yojana and for the subsi-'
subsi sed treatment of cancer, AIDS, and certain other illnesses. It is easy to
levy taxes but difficult to ensur
ensue that the funds so raised are effectively used to benefit the targeted
groups rather than middlem
better-off sections that wield influence over the administrative machinery
or the political system. The levy of indirect taxes under one head or another might cumulatively affect
costs of production and eve tu: ly lead to lower consumption of goods and undermine revenue
realisation itself. Further, resor ;g to indirect taxes, rather than direct taxes, which take into account the
paying capability of the citizc n, ; socially regressive. Before any scheme of collection of a health cess is
implemented, the potential f >r: pping direct taxes alone should be explored, and democratic
decentralisation of powers r. dr ip to the village level ensured. The proposal for lowering the excise duty
on all drugs from 16 per cer‘ t dght per cent and raising the turnover limit for excise exemption to Rs.5
crore from Rs.1 crore for sn i cale manufacturers should help reduce the cost of drugs. But steps must
be taken to prevent artificial sj ting of production capacity, a tactic adopted to take advantage of SSI
concessions.
The draft pharma policy (its P t B' relating to statutory price control is awaited) states that generic drugs
will be totally free from price c • rol and that these will be given preference in government purchases. It
also seeks to link approval f r tented drugs with price negotiations. These provisions reveal a
continuing lack of confidenc
he capability of Indian companies to innovate and develop drugs. Every
generic' drug was once an . vator drug' commanding a premium price during the term of the patent;
this compensates innovatin
ipanics for the costs and risks of product development and testing. Any
built-in disincentive for patei .t-. drugs will only put off the day when national companies acquire the
capability to come out with inns ator and advanced drugs. It is true that drugs out of patent can be used
effectively, with substantial
I and cost benefits. However, thrusting generic drugs one-sidedly on
public hospitals patronised
y by the poor is tantamount to denying them the benefit of the latest
advances in medicine. Also
jlatory approval for drugs should be based solely on safety and efficacy
and not vitiated by consider
... countries approval is linked to price
,s of' p. ice. ‘In many developed
negotiations but then the sta.L :sum s responsibility for the health care of all citizens and provides a
social safety net for them.
1
Draft
National Pharmaceuticals Policy, 2006
Part -A
(Contains issues other than statutory price control)
Department of Chemicals and
Petrochemicals
Government of India
December 28, 2005
1
National Pharmaceuticals Policy 2006
PART - A
(contains issues other than statutory price control)
1.0 Introduction
FndTntfJn
k |Owlled8u SkillS’ gr0Wing enterPrise>10w costs, improved quality and demand (domestic
ma icna ) tie pharmaceuticals sector has witnessed a tremendous growth over the past few years
-from a turnover of Rs 5000 crores in 1990 to over Rs 50,000 crores during 2004-05. Exports have also
fhe ?pndVery S,18^Cfntly t0 over Rs 16700 crores during this period . India is today recognized as one of
and I ^h-8 f
PraT
manufacture of Pharmaceuticals - it holds 4,h position in terms of volume
and 13th in terms of value of production. It is also recognized that the cost of drugs produced in India is
Rs
OOO6 °WeSt.'nfthe W°rld- 11 ls estimated that by the year 2010 industry has the potential to achieve
cro es India’sTh L" fOrmUlat,°"S Tn bUlk drU8 Pr°duCtion 8°ing UP from Rs 8000 -ores to Rs 25 000
crores. India s rich human capital is believed to be the strongest asset for this knowledge-led industry
arious studies show that the scientific talent pool of 4 million Indians is the second largest English^
speaking group worldwide, after the US. However despite the impressive growth of the lector and low
costs there are several concerns which need to be addressed. Some of thesf concerns pert"
accessibility and affordability of medicines by the common man particularly the vast Segment of
un;,nSt'tL,t"\8 standards of
particularly for units not conforming to standards of
gulated markets, strengthening the fragmented regulatory system, sustaining growth of generics -the
mam forte of Ind.an mdushy . meeting the challenge of product patent regime and so on Tnorde, to find
the right solutions and the right balance between various viewpoints almost a continuous debate goes on
f 831 .ln8 SOme 0 dlese issues both within and outside Government In the year 2002 Government had
ormulated a new Drug Policy but the same could not be implemented due to litigation involving
it hence the policy of 1994 still continues to be in force. The present Policy known as the National
Pharmaceuticals Policy 2005 has been necessitated due to several developments that have taken place
Price reJe|Cr°UrSef?aSt
Y‘j3''8 38 We" 38 t0 addreSS some ofthe major concerns as highlighted above
nthe ga at'?n Of the e^sentlal medicines is an important component of this policy. However several
t X S
g 3 C'0Se bearing °n tbe PbanTlaceiiticals sector have also been Included in
>v L/LUlvy.
2.0
Past Approach
S^eeting the ret?uirements of medicines at reasonable prices as also for strengthening of the
'nJ ®enous manufacturing capacity and capability, the Government has. over the years formulated
policies and issued drug price control orders from time to time. The first price control order was issued
under, e Defence of India Ae, in l» .Thereafler from 1970 onwards prtc"«"olX Z taed
under the Essential Commodities Act, 1955. Presently the Policy of 1994 is in existence and nrice control
is bemg exercised through the Drugs Price Control Order, 1995 under which prices of 74 bulk drugs and
J'
1
2
their formulations are controlled . Under the 2002 policy a new price control criteria was approved
.However before the same could be implemented it was stayed by Karnataka High Court. An
SLP was filed in the Supreme Court against the order of Karnataka High Court .Supreme Court vide its
interim order on 10th March, 2003 stayed the order of Karnataka High Court. However it also ordered
that —
the petitioner shall consider and formulate appropriate criteria for ensuring essential and life
saving drugs not to fall out of price control and to review the drugs which are essential and life saving in
nature till 2nd May,2003.” Accordingly the Central Government reviewed the National Essential Drug
List, 1996 and brought out a new list called the National List of Essential Medicines ,2003 which was
made available to the Supreme Court .Under this list as many as 354 drugs have been categorized as
essential medicines. Another important development that has recently taken place in India is the
introduction of product patent regime in pharmaceuticals with effect from 1st January, 2005. Earlier with
the enactment of The Patent Act ,1970 (which came into force in the year 1972) only process patent was
made applicable for pharmaceuticals which played a very significant role in the development of the
pharmaceutical industry in India . India 3 emerged as a major producer and exporter of pharmaceuticals
in the world .
After India became a signatory to the WTO and TRIPS agreements it was obliged to introduce product
patent on pharmaceuticals with effect from 1st January , 2005 . Our patent law has now been made TRIPS
compliant by fulfilling various commitments under the TRIPS agreement. This has brought a
new challenge to the Indian pharmaceutical industry as it would no longer be able to freely continue with
the production of generics of the new patented molecules without licence/payment of royalty to the
innovator company. With this paradigm shift the Indian industry would now be required to focus much
more on research and development.
2.1 Experience Drawn from Past Pharmaceutical Policies
The first comprehensive Drug Policy of 1978 and thereafter the Drug Policy of 1986 together with the
application of process patent under the Patent Act of 1970 successfully paved the way for development of
indigenous pharmaceutical industry which went into the production of generic drugs in a big way . A
conducive environment for success was provided by the then prevailing trade and economic policies .
During the period from 1978 to 1990 indigenous industry acquired a respectable status in
terms of product range and market share. R&D was confined to process development/innovation of
existing molecules.
As regards pricing, the span of control, inclusion/exclusion of drugs under price control, methodologies
adopted etc. continued to be debated. The Government developed principles of selectivity, from time to
time, to keep the price control manageable and focused, as would be observed from declining trend in
number of drugs under price control. In 1970, almost all bulk drugs and their formulations were under
price control. In keeping with the economic policies of the country the number got reduced to 347 bulk
drugs in 1979, 142 in 1987 and finally to 74 in 1995. It would have got reduced further under the criteria
adopted in the Pharmaceutical Policy 2002, however, the same could not be implemented due to litigation
involving it.
3.0
Important Developments after liberalization process in 1991
Following are some of the important developments that have taken place in pharmaceutical sector after
the process of liberalization of the Indian economy was initiated by the
Government in the year 1991 —
1.
Industrial Licensing: Industrial licensing for all kinds of drugs has been abolished (it has recently been done
for the last remaining bulk drugs produced by the use of recombinant DNA technology,
bulk drugs requiring in-vivo use of nucleic acids and specific cell-tissue targeted
formulations). However the need for obtaining manufacturing licence under Drugs and
Cosmetics Act, 1940 continues for all units whether organized or small scale. The State
Drug Controllers are authorized to issue such licences in most cases.
3
2.
Foreign Direct Investment
FDI up to 100% is permitted, subject to stipulations laid down from time to time in the
Industrial Policy, through the automatic route in the case of all bulk drugs cleared by the
Drug Controller General (India), all their intermediates and formulations. Recently bulk
drugs produced by the use of recombinant DNA technology, bulk drugs requiring in-vivo
use of nucleic acids as the active principles and special cell/tissue targeted formulations
have also been allowed this facility.
3.
Foreign Technology Agreement
Automatic appioval for Foreign Technology Agreement (FTA) is already available in the
case of all the bulk drugs cleared by Drug Controller General (India), all their
intermediates and formulations, except bulk drugs produced by the use of recombinant
DNA technology, bulk drugs requiring in-vivo use of nucleic acids as the active
principles, and specific cell/tissue targeted formulations.
4.
Imports
Imports of drugs and pharmaceuticals are regulated through EXIM Policy in force and
presently all items except those requiring clearance under The Narcotics and
Psychotropic Substances Act, 1985 are allowed under OGL. Further, a centralized
system of registration has been introduced under the Drugs & Cosmetics Act and Rules
made there under, administered by Ministry of Health and Family Welfare. These
arrangements may continue to regulate imports of Drugs and Pharmaceuticals.
5,
Exports
Exports are permitted in accordance with the EXIM Policy and relevant procedures/rules
formulated for the purpose by the Directorate General of Foreign Trade. Exports are also
subject to laws prevalent in importing countries. Also, the exporters are allowed imports
of inputs on duty -free basis for export production. The industry has shown commendable
export performance, the trade balance being positive. Over the last few years the
compounded annual growth rate in exports has been 22.7 percent.
6.
Constitution of Pharmaceutical Export Promotion Council ( Pharmexil)
In order to provide a boost to pharma exports Government constituted a separate Export
Promotion Council for Pharmaceuticals (Pharmexil) in the year 2004-05. This Council
works closely with the Department of Commerce and the Export Promotion Cell in the
Department of Chemicals and Petrochemicals to undertake activities such as promoting
exports, preparing country-profiles, assessing export potential across the countries and to
have greater degree of interaction internationally.
7.
Research & Development
As recommended by the Mashelkar Committee in 1999 a Pharmaceutical Research and
Development Support Fund (PRDSF) with a corpus of Rs. 150 crores has been set up
under the administrative control of the Department of Science and Technology. A Drug
Development promotion Board (DDPB) to administer the utilization of PRDSF has also
been set up .
8.
Product Patent in Pharmaceuticals Product patent in pharmaceuticals has been introduced in the country with effect from 1st
January , 2005 by amending the Patents Act, 1970 in conformity with the TRIPS
agreement. The physical infrastructure in the four patent offices in the country (Kolkata,
Delhi, Chennai and Mumbai) has been substantially strengthened and computerization
has been introduced. Steps are now being taken to further augment and
improve the software and human resources in these offices to enable them to deal with
the new responsibilities .
4
9.
Schedule M of Drugs and Cosmetics Act ,1940The revised Schedule M of the Drugs and Cosmetics Act, 1940 related to Good
Manufacturing Practices (GMP) has come into effect from IstJuly 2OO5.This would in
the long run strengthen the pharma industry as a producer of quality medicines .
10.
Introduction of Value Added Tax (VAT)
VAT has been introduced in India with effect from 1st April,2005. Already 22 States
have implemented it .The remaining States are likely to implement it in the near future.
VAT on medicines has been kept at 4%
11.
Excise Duty payable on MRP (Maximum Retail Price)
A Notification was issued on 7th January, 2005 under which Excise duty became leviable
on MRP with an abatement of 40% .
4.0
Key Policy Objectives :
Following are the key objectives of the policy(a) To ensure availability at reasonable prices of good quality
medicines within the country
(b) lo improve accessibility of essential medicines for common man particularly the
poorer sections of the population
(c) To facilitate higher investment for increased production of good quality medicines
(d) To promote greater research and development in the pharmaceuticals sector by
providing suitable incentives in this regard.
(e) To enable domestic pharma companies to become internationally competitive by
implementing cGMP,GLP ,GCP and other established international guidelines
(f) To facilitate higher growth in exports of APIs and formulations by reducing the
barriers to international trade in pharmaceuticals sector To develop India as the preferred
global destination for pharma R&D and manufacturing To facilitate implementation of
the Health Policy of the country
4.1
The National Common Minimum Programme, as adopted by the Government aims
as follows:
a) UPA Government will raise public spending on health to at
least 2-3% of GDP over the next five years with focus on primary
health care.
b) A national scheme for health insurance for poor families will be
introduced.
c)The UPA will step up public investment in programmes to
control all communicable diseases and also provide leadership to
the national AIDS control effort.
d) The UPA Government will take all steps to ensure availability of
life savings drugs at reasonable prices.
e) Special attention will be paid to the poorer sections in the
matter of health care.
f) The feasibility of reviving public sector units set up for the
manufacture of critical bulk drugs will be re-examined so as to
bring down and keep a check on prices of drugs.
An issue of paramount importance in the Indian context is to
increase the accessibility of drugs to the common man and in
particular to the vulnerable and poorer segments of the
population .Even though the prices of drugs as compared to most
other countries and particularly the neighbouring countries are
one of the lowest yet these are important issues relevant to India .
A Committee set up by Government under the chairmanship of
5
Joint Secretary (Pharmaceuticals) popularly known as the Sandhu Committee had made
several recommendations in this regard. Thereafter the Task Force headed by Dr Pronab
Sen principal Adviser (PP), Planning Commission popularly known as the Sen
Committee made several other wide ranging recommendations Some important
recommendations were made by the National Manufacturing Competitiveness Council
(NMCC). National Commission on Macroeconomics and Health Constituted by the
Ministry of Health and Family Welfare in its report on ‘Access To Drugs and Medicine’
also made some valuable recommendations on issues relevant to the drug industry. The
recommendations made by all these Committees have been examined by Government
and there is a broad agreement on the implementation of several of the recommendations.
Several suggestions were received from industry associations, voluntary bodies, States
and other organizations. A Core Committee consisting of representatives of Department
of Chemicals and Petrochemicals, NPPA, NIPER and Chief Executives of various public
sector pharma undertakings was constituted to facilitate drafting of the policy based on
the various / suggestions .
1.
New Policy Initiatives
The new initiatives except for price control are enumerated in Part A of the report while
Price control system is enumerated in Part B of the report ( Part B has been prepared
separately)
Srengthening of Drug Regulatory System
Drug regulatory system has a close bearing on the prices , availability and quality of
drugs. Under the Drugs and Cosmetics Act, 1940 there is dual regulatory control over the
drugs by Central and State governments. While regulation of manufacture , sale and
distribution of drugs is primarily the responsibility of the State Authorities , the Central
Authorities are responsible for approval of new drugs , clinical trials, laying down
standards for drugs , control over imported drugs , coordination of the activities of state
drug control organizations The Expert Committee set up by Government under the
chairmanship of Dr R A Mashelkar,Director CSIR in its report submitted in 2003 has
made comprehensive recommendations for strengthening the drug regulatory system
including the problem of spurious drugs . It has made detailed recommendations to
strengthen the existing regulatory organizations both at the Centre and the States. The
Task Force set up by Government to ‘ Explore Options other than Price control for
achieving the objective of making available life saving drugs at reasonable level’ has
recommended that in the long run both the functions of drug regulation and price
control should be performed by the same agency and there should be an integrated
regulatory system.
Keeping in view the recommendations of the two Committees it has been decided that a) As an immediate step an independent and autonomous body
by the name of National Drug Authority would be constituted in
place of the present Central Drugs Standard Control Organisation
(CDSCO).
b) Several of the existing provisions of the Drugs and Cosmetics
Act, 1940 would be amended to make the penalties more
deterrent for various offences and in particular for spurious and
sub-standard drugs . A bill in this regard has been introduced in
the Parliament
c)In the long run the proposal of Task Force regarding merger of
NPPA and NDA would be considered in the form of National
Authority on Drugs and Therapeutics (NADT) which will lead to an
integrated regulatory system in the country.
(Comments by Health)
2.
Intellectual Property Rights including Data Protection
6
Government is committed to making the Indian laws and policies pertaining to
Intellectual Property Rights fully compliant with the provisions of TRIPS . Significant
progress has already been made in this regard. Product patent in case of pharmaceuticals
has been introduced with effect from 1st April, 2005 by amending the Patents Act ,1970 .
Under this Act both product as well as process patents can now be granted for
pharmaceuticals .New Rules are being framed under this Act and would be notified soon.
Under these rules it would be the endeavour of the Government to simplify procedures
and shorten the timelines for various approvals. Modernisation of Patent Offices in the
country has been undertaken and the number of patent examiners has been augmented in
these offices. Following action is contemplated towards further improving the working of
the patent offices -
a) Proper training to be imparted to the personnel working in the
four patent offices .Trainers from India and abroad would be
utilized for this purpose.
b) The number of patent examiners to be further increased to
match the increased workload
c) Full computerization would be undertaken so as to bring about
greater transparency and convenience in the functioning of these
offices.
d) All the pending patent applications to be made available on the
website of the patent office
e) Electronic filing of patent applications to be introduced
b) An IP Cell to be set up in the Department of Chemicals and
Petrochemicals to support innovator pharma SMEs in the
patenting process , training in documentation and other areas of
intellectual property .This would enable them to take advantage
of the patent regime and in the process encourage greater R&D
in their enterprises
c) A Technical Expert Group has been constituted under the
chairmanship of Dr R. A. Mashelkar , Director General, Council of
Scientific and Industrial Research with the following terms of
reference• whether it would be TRIPS compatible to limit the grant of
patent for pharmaceutical substance to new chemical entity
or to new medical entity involving one or more inventive
steps,
Whether it would be TRIPS compatible to exclude microorganisms
from patenting As regards Data Protection various options are being examined by the
Inter-Ministerial Committee headed by Secretary, Department of Chemicals and
Petrochemicals . The Committee has heard various viewpoints on the subject and is likely
to submit its report soon .Suitable policy decision/action would be taken after receipt of
the report of the Committee on this matter. (Comments by Health / DIPP/ Commerce)
4.
Clinical Trials and Drug Development
Clinical Trials are essential for drug development. Schedule Y of the Drugs and
Cosmetics Rules, 1945 has been amended to allow for multicentric concurrent clinical
trials in India. Under these rules clinical trials have been defined and it has been made
mandatory to take approval for conducting any type of clinical trials in the country. Also
Good Clinical Practices (GCP) guidelines have been published and made mandatory . It
also addresses the protection of study subjects (patients/volunteers) and integration and
quality of data . Following action is contemplated to facilitate and encourage clinical
trials in Indiaa) An early decision on data protection
7
b) As improved regulatory infrastructure and some form of protection to undisclosed test
data will increase the activity in this field.
c) In order to facilitate pre-clinical trials National Toxicology Centre set up in NIPER to
be made fully compliant with GLP norms
d) Tax benefits available to R&D to be made applicable for
Clinical trials also
e) Clinical trial samples being imported into India to be
exempted from payment of import duty on the basis of
authorization/licence issued by Drug Controller General of India
f) To promote direct investment in the field of clinical development and data
management exemption from service tax for a period of 10 years upto 2015
(Comments by Health /DST/Revenue)
5.
Public-Private Partnership Programme for Anti-Cancer and Anti-HIV/AIDS Drugs
For making available anti-cancer and anti-HIV/AIDS drugs at reasonable prices to a
much larger section of the population Government would evolve a public - private
partnership programme with the concerned manufacturers and cancer hospitals in the
country. All medicines pertaining to these categories whether under National List of
Essential Medicines,2003 or outside would be brought under this programme . Some of
the steps proposed to be taken are as under
a)
Anti Cancer Drugs—
At any given point of time there are about 20 to 25 lac people suffering from cancer in
the country who are affected by various types of cancer ( lung cancer, blood cancer etc.)
It is estimated that every year about 7 lac people are detected with different types of
cancer Most of them are unable to afford the cost of expensive anti-cancer medicines
.Going by a conservative estimate of average cost of anti-cancer medicines per patient as
Rs 25,000 it would require medicines worth Rs 5,000 crores . As against this, the present
turnover of this segment of medicines in India is estimated to be only Rs 150 crores. The
big gap indicates the near non-accessability of the medicines to a vast majority of the
affected population mainly because of the high cost of these medicines .
In order to reach out to a larger number of cancer patients following steps would be taken
1 .Government would completely exempt anti-cancer drugs (bulk
and formulations) from all types of Central taxes - excise duty,
import duty etc and the benefit would be passed on to the
consumers.
2.States would also be asked to exempt these medicines from all
types of state and local levies
3.Industry and trade would be asked to reduce their margins —
both profit and trade margins to the barest minimum level
and pass on the benefit to the consumers .
4 A subsidy scheme for making cancer drugs affordable to the
common man would be worked out with the help of concerned
manufacturers and the Cancer hospitals. Under this scheme a
subsidy on the sale of anti-cancer drugs would be made available
to all the cancer hospitals who register under the scheme .
5 Subsidized anti-cancer medicines would be provided to all the
cancer patients from the retail outlets of the cancer hospitals on
the recommendations of the doctors of such hospitals
In order to take advantage of lower rates from bulk purchase a
Rate Contract for the anti-cancer drugs would be worked out with
the manufacturers for all the hospitals which join this scheme .
All Government run hospitals with facilities for treatment of cancer
8
would be eligible to become members of the scheme as also the
private cancer hospitals.
Efforts would be made to create drug banks in major cities where
manufacturers would be encouraged to contribute to these drug
banks which may be managed by hospitals and NGOs
(Comments by Revenue/Health/States)
b)
4.
Anti-HIV/AIDS Medicines
India has the highest number of reported HIV/AIDS cases in the
entire SOUTH Asian region.There are as many as 5.1 million
people affected by HIV/AIDS in India , about 85% of the South
Asian total. In the world India has the second highest reported cases of HIV/AIDS just
below South Africa’stotal of 5.3 million There are presently 39 Anti-Retroviral Therapy
(ART) Centres in the country located mostly in the medical colleges and major tertiary
hospitals.These are located mostly in the six high prevalence states namely Karnatka,
Tamil Nadu,Andhra Pradesh, Maharashtra, Manipur and Nagaland.
100 new centres have been identified to be opened in the near future and the number
would go to 188 by the year 2010. It would be the endeavour of the Government to open
atleast one or two centers in each state .
The number of patients being provided free treatment through the ART centers is 16000 .
(another 16000 patients are being treated by Railways and ESIC and 10000 by the private
sector). The number of patients treated would be taken to 500,000 by the year 2010. Apart
from the assistance available under the Global Fund for Aids, TB and Malaria-Round 4 ,
additional funds would be provided to cover the entire AIDS affected population.
Presently anti-HIV/AIDS drugs that are being manufactured in India are mostly first
generation which have developed resistance in many cases. Production of second
generation drugs would be ensured in the country so as to provide an effective treatment
on a continuous basis.
Some of the measures envisaged to reduce the cost of ARV drugs and increase their
availability are as follows a) Complete exemption of anti-HIV/AIDS drugs (bulk drugs as well as formulations)
from the payment of excise duty, customs duty and other levies ,if any. This benefit
would be passed on to the patients .
^Manufacturers and Trade to charge lower profit and trade margins on these drugs.
c) Most of the first generation drugs and some of the second generation drugs are
presently being manufactured in India .All efforts would be made to ensure production of
second generation drugs in the country in consonance with the provisions of Patent Act
,1970
d) Incase of second generation drugs which are not manufactured in India these would be
procured at prices which are negotiated with the concerned manufacturers .
(Comments by Revenue / Health/NACO)(In the case ofAIDS cheaper and more easily
available drugs have led to 80% decline in deaths between the period 1997 and 2003 -as
reported by researchers from India and Rhode Island in the November 15 issue of
Clinical InfectiousDiseases.
Government is running 39 testing and treatmentcenters where over 14400 patients are
being treated - only those with CD 4 count below 200 per cubic ml of blood are treated.
Railways and industry is treating another about 30,000 patients.
At the same time the fact is that there are over 5 million HIVpositivecases in India which
is 10°/o of the world’s population ofpeople with HIV. Estimates ofpopulation affected by
HIV variesbetween 5 million to 7 million. Presently NACO is purchasing medicines and
distributing these free ofcost through its Centers and State Aids Control Societies
Government would allocate larger funds for the purchase ofthese medicines particularly
anti -AIDS through a centralized system)
Prices of Drugs for Other Life Threatening Diseases
9
Drugs for other life threatening diseases requiring life long
treatment,whether part of National List of Essential Medicines,2003 or outside it, would
also be identified and brought under the public -private partnership model
5.
Patented Drugs -price negotiations
The patented drugs (formulations under product patent) that are
launched in India after 1st January, 2005 would be subjected to
mandatory price negotiations before granting them marketing
approval. Department of Chemicals and Petrochemicals in
consultation with Department of Health would lay down necessary
guidelines for determining the negotiated prices. Practices
adopted by some other countries particularly Canada, France and
Australia and some of the Asian countries and their experience in
this regard would be studied at the time of framing the guidelines.
The norms for price negotiations would be made applicable from
the date of notification of these.
After the norms are notified an Expert Committee would be
constituted for carrying out the negotiations on case by case
basis with the concerned companies. (Comments by Health /NPPA)
6.
Trade Margins
The issue of trade margins has been the subject of intense debate from time to time and
different views have been expressed on this issue . Government appointed a Committee
headed by Joint Secretary (Pharmaceuticals Industry) in the Department of Chemicals
and Petrochemicals to examine this issue along with other issues relating to drug prices
.Based on the recommendations of this Committee a suitable decision would be taken in
the matter.
( Based on the recommendations of this Committee following can be the trade margins
for different drugs— Category A Drugs (drugs under cost based price control)- Both
Branded and Generics- 8% wholesaler , 16% for retailer. These margins are already
prescribed under the present system ofprice control
(2) Other Drugs(Not under cost based price control)
a) Branded — 10% wholesaler, 20 % for retailer
- these margins are prevailing as per an agreement
between the industry and trade. Branded generics ( 5 to 7%))
would also be put in this category
b) Generics - 15% wholesaler, 35%) for retailer
These margins are not prescribed at present and vary
largely across various drugs. Generics form account for 5 to 7 % ofthe total market
NOTE - All the above trade margins would be calculated on theMRP of the
drug.Comments byNPPA
7.
Excise duty relief
Excise duty on pharmaceuticals continues to be at the rate of 16%. With effect from 7th
January,2005 excise duty was made applicable on MRP of drugs with an abatement of
40% . This means that the excise duty is now levied on 60% of the MRP as compared to
the ex-factory price earlier. This has increased the burden on the industry particularly the
small scale sector. The high rate of excise duty is particularly visible since the State
governments reduced the applicable VAT rate to 4% in recognition of the essential nature
of pharmaceutical products. At a time when there is a demand to make prices of
medicines affordable and reasonable, particularly for the poor people, it becomes justified
for government to reduce the excise duty from 16% to 8% on all medicines. Hence it has
been decided to reduce the excise duty on all pharmaceutical products from 16% to 8% In
addition it has been decided to enhance the exemption limit of small scale units from
excise duty from the present level of turnover of Rs. 1 crores to Rs. 5 crores
10
8.
Both these steps are likely to reduce prices of medicines and also provide the much
needed relief to the small scale units leading to their survival, improved quality and better
tax compliance which would have a positive effect on the revenues of Government
(Comments by SSI / Revenue)
Maximum Retail Price (MRP) inclusive of all taxes
Under the provisions of Packaged Commodities Rules, 1977, all commodities sold in
prepackaged form are required to have a label declaration of retail sale price in the form
of MRP inclusive of all taxes. This concept is well accepted and is being used for all
packaged consumer goods in India except drugs .
DPCO requires ‘Retail Price not to exceed Rs
local taxes extra ,” so that basic MRP
is strictly followed and only actual taxes , which vary, are charged extra. However, in
practice , this often leads to wrong calculations , extra charges and debate between the
dealer and the consumer. From the consumer’s point of view it is most desirable that the
total price should be absolutely clear on the pack and uniform all over India.
It has now been decided that the concept of MRP inclusive of taxes would be made
applicable to medicines sold in the packaged form.
(Comments by Consumer Affairs / Health/NPPA)
( With introduction of VAT in several states at the uniform rate of 4% (with remaining
states to follow suit) and CST likely’ to be made 2o
/o for the time being and soon to be
abolished time has now come to introduce MRP inclusive of all taxes to dru gs and
medicines . Industry would be given time ofthree months to switch over to the new
system.)
9
New Drug Price (Control) Order
Immediately after the approval of the new pricing system under this policy a new Drug
Price (Control) Order (DPCO) replacing the existing DPCO , 1995 ,would be issued
under the Essential Commodities Act, 1955, incorporating the new system -as is decided
in part B of the policy
10.
Drugs and Therapeutics ( Regulation ) Act —
Inorder to give full effect to the new policy it is essential that a new law is enacted to
exercise a more effective price control / monitoring of the prices of drugs . Therefore a
new Act to replace the existing system of Drug Price (Control) Orders under the EC Act
would be enacted by the name of Drugs and Therapeutics (Regulation) Act (DATA). The
main features of this Act would be
a) Empowering government or its designated authority to impose a price or limit the
increase in the price or control the price in any other manner of any individual, class or
category of drug or therapeutic product for any period of time it deems appropriate in
public interest, irrespective of the fact whether a drug is manufactured in India or outside.
b) Requiring the government or its designated authority to clearly lay down the principles
governing or the reasons leading to imposition of any such price control or any deviations
permitted there from.
c) Authorizing the government or its designated authority to seek or compel disclosure o f
any information or data relevant to its functioning from all manufacturers, marketers,
distributors or retailers of drugs and therapeutic products.
d) Requiring all companies involved in the manufacture or marketing of drugs and
therapeutic products to submit authenticated price lists of all their products along with
other relevant details to government or its designated authority on a regular basis with a
frequency to be specified by the latter.
e) Granting the government or its designated authority the power to approve a brand
name for a specific product, to prevent changes in the composition of a product marketed
under an approved brand name and to determine the nomenclature under which a product
can be marketed, if necessary, for all drugs and therapeutic products.
11
f) Providing penalties, for violation or non-compliance with the provisions of the Act or
the Rules framed and orders issued under the Act. These penalties could be graded fines, temporary withdrawal of marketing approval, withholding of marketing approval,
sealing of production facilities, compounding of offences, etc.
g) Other relevant provisions with regard to production and prices as mentioned in the EC
Act, 1955 would be incorporated in the Act to the extent possible.
h) Greater role and accountability of State Drug Controllers would be specifically
provided for under the Act. (Comments by Health/Consumer Affairs)
11.0
National Pharmaceutical Pricing Authority (NPPA)—
National Pharmaceutical Pricing Authority was set up as envisaged in the Drug Policy of
1994 for fixation and monitoring of prices of various drugs as well as various related
matters per the provisions of the Drugs (Prices Control) Order, 1995 and in accordance
with the powers delegated to it.
Strengthening of NPPA
In order to enable NPPA discharge its responsibilities more effectively there is an
immediate need to bring about some fundamental changes in its working. These are as
follows :
Present structure and working of NPPA to be revamped to bring in greater transparency
in the organization like making available information on the NPPA website pertaining to
various norms, guidelines, details of ceiling prices of various drugs etc.
The tenure of Chairman to be minimum 2 years with maximum age limit as 62 years.
Strengthening of the monitoring system of NPPA through appropriate computerization
and software. A system of online filing of prices on a six monthly/ annual basis and other
information by industry to be developed
Establishment of a regular linkage between NPPA with the State Drug Controllers
through a dedicated Drug Price Monitoring Cell in each of the major States and on-line
electronic linkage. The full cost of these Cells and electronic hardware and connectivity
would be funded by Central Government. (Health Department is already providing an
all- India link with all States-this could be made use of for prices as well)
Review of all existing guidelines , norms and procedures followed by NPPA for fixing
prices of bulk drugs and formulations by a Committee to be set up by Department of
Chemicals and Petrochemicals. Among others this Committee would include
representatives of pharmaceuticals industry also.
(Comments by Health /NPPA )
12.
0 Bulk Procurement system for Drugs by Government—
The system of procurement in the Central Government must essentially ensure that
quality drugs> are purchased and that drugs have active ingredients at the maximum level
throughout
the shelflife period of the drug.
Following would be the main guiding factors for
procurement of bulk purchase of medicines by various government agencies:
( a) Procurement preferably in the form of generic drugs
(b) Procurement only from pre-qualified manufacturers of drugs
(c) Technical and price bids to be invited in separate envelopes.
Bids /tenders to be invited through press and website of the
concerned department.
(d) Schedule M for GMP compliance of the manufacturer to be
ensured.
(e) Minimum three years of track record in sustained production
and marketing of the concerned drug. Balance sheets for the
previous three years be obtained to make an assessment of the
manufacturing and financial capacity of the manufacturer.
12
(f) Post-award inspection of manufacturing facilities to be
carried out by the purchasing agency
(g) Batch-wise sample testing of drugs from government run or
government approved laboratories before the drugs are put to
use. Incase of failure of a drug during testing suitable penalties to
be imposed on the manufacturer
h)Packaging specifications may be prescribed for better shelflife
Incase the price quoted by a manufacturer is lower than the price
fixed by NPPA by more than 15% he should be asked to provide
justification for the same. Incase he is unable to provide proper
justification his / her bid should be liable to be rejected.
Third party quality assurance may be adopted as is being done
by Health Department for World Bank funded drugs. It should be
the responsibility of this agency to ensure supply of quality drugs.
Where a different criteria and methodology has been prescribed
by any lending agency( World Bank,WHO , UNICEF etc) the
same may be followed.
I) Expired drugs must be destroyed by the hospitals as per the
norms laid down by Pollution Control Board
In some of the Central Government Organisations and States a
centralized purchase system for drugs is adopted. It would be in
larger public interest that a similar system is adopted in all the
organizations and the States
(Comments by Health /States)
13.0
14.0
Lower Prices for bulk purchases by Government For the bulk purchases made by Government for public health requirements (government
hospitals/programmes , health insurance etc.) ceiling prices as follows would be fixed
within
which purchase prices would be charged by the manufacturers through open tenders For drugs under NPPA cost based price control -a ceiling price of 65% of the price fixed by NPPA
For drugs other than those under cost based price control and
patented drugs
-a ceiling price of 50% of MRP of the drug
The above ceiling prices would apply to both branded as well as
generic drugs.
DPCO would be suitably amended to provide for these ceilings
Promotion of Generic Drugs It is seen that generally generic drugs are priced lower than the branded ones Presently
the branded drugs dominate the market in India and there is a very small presence of the
generic drugs. One of the ways to make available cheaper drugs to people at large and to
the public health system could be to
promote the production of generic drugs in the country. This could be done in the
following ways Public procurement and distribution of drugs through the public health system would
preferably be for generic drugs.
Quality certification would be provided free of cost to generic drug manufacturers
through an appropriate scheme
No control on prices of generic drugs(cost based or MRP based) would be specified |
.These would, however, be kept under price monitoring. Only those drugs would be
exempted from price
’I
control which follow the prescribed norms (Comments by Health/NPPA )
13
Note- Generic drugs would mean drugs popularly sold under their chemical names only
(generic generic drugs)
15. Control on Pharmaceutical brands
The present system of brand approvals in the country appears inappropriate for the
phaimaceutical sector. There are two kinds of problems that are commonly encountered.
First, even a casual look at the list of brands existing in the Indian pharmaceutical sector
reveals that a number of products have either the same
brand name or names which are very similar both phonetically and written. Second, there
are a number of recorded instances where the composition of a particular brand has been
changed without any change in the brand name - a phenomenon termed as ‘misbranding’.
Both these have the potential to cause
immense harm through mis-prescription and/or wrong dispensing.
At present, brand names of drug products are approved while granting manufacturing
licenses by the State authorities, which is not a desirable practice when marketing is done
at the national level. It is, therefore, suggested that branding of drugs and other
therapeutics should be brought under the Central drug regulatory system. The drug
regulator must be required to maintain a data base on brands and their compositions, and
all brand registration of drugs must compulsorily be approved by the drug regulator In
particular, no change should be permitted in the composition of a given brand. Necessary
changes would be made in the Drugs & Cosmetics Act, 1940 in this regard . (Comments
by Health)
16.
Quality Certification of drugs
The prevailing system of drug certification is completely opague as far as the therapeutic
quality and effectiveness of different brands are concerned, certainly to the patient and
also possibly
for the doctors. The Indian Pharmacopeia (IP) certification or its equivalent in other
countries , attests the quality of the API in most cases, and not to the quality of
formulation, which is what the patient actually purchases. Different formulations of the
same
API are perceived to have different levels of effectiveness due to different bioequivalence
of the APIs, differences in the excipients or the drug delivery technology. Lack of
adequate information and awareness may lead to ‘adverse selection’ behaviour, whereby
a higher price is associated with better ‘quality’
Government would institute a method of widely publicizing GMP certification as a
guarantor of quality of the certified drug. In addition a quality mark like the ISI or
Agmark approvals would be e volved through industry involvement - BIS would be
involved with the grant of these quality marks .These marks would be awarded only on
submission of bioequivalence and bioavailability
studies to the DCGI. (Comments by Health /Consumer Affairs /BIS)
17.
Strengthening of Pharma PSUs
Pharma PSUs have played an important role in producing and making available low cost
essential drugs in the country. Also they help in carrying out important cost studies for
drugs. Some of these PSUs are sick and need to be revived . Rehabilitation packages are
being prepared to revive these units
A Pharma Development Fund would be created to help these units to conduct drug
development including clinical trials ,patent filing and upgradation of technology
(Comments by Health/ DPE)
18.
Purchase Preference to Pharma Public Sector UndertakingsPublic Sector Pharma enterprises have in the past served a very useful purpose in
providing some of the essential drugs required in the country. They still continue to be
relevant and have been at the forefront during times of calamities/emergencies. Under the
January 23, 2006
Comments on the Draft National Pharmaceutical Policy (DP
06) 2006 Part A from LOCOST Baroda/JSS Bilaspur
General Comments
1) Many of the statements made in the Draft National Pharmaceutical Policy (DP
06) appear to be agreeable in the absence of details. The devil is in the details.
2) While the intentions are good, the locus ol the DP 06 comes across, regrettably,
as a how-to-maku-India’s-pharma-industry- llourish-further type of document
with a few sops thrown in for the poor, etc.
3) We lound the Pronab Sen (. oinmittce had more focus especially regards making
medicines affordable, etc. for instance, (he ITonab Sen Committee had advocated
debianding. 1 heie is no mention ol this anywhere. Nor on irrational combination
drugs and what is to be done with them.
4) Nor is there any situation analysis of the present pharma scenario form the point
ol view of affordability, users, etc.1
1 f or instance:
o
In the WHO report on u The World Medicines Situation 2004” In India, an
estimated 499-649 million people (50% to 65% of the population) do not have
regular access to essential medicines.
o A survey done by Strategies for Enhancing Access t ' '
to Medicines Program on
Access to I Essential Medicines in Rajasthan 2001, more than 40% ofthe
population surveyed found drugs unaffordable.
o
Healthcare costs have been rising, and the proportion of people who do not seek
treatment because ol financial reasons has increased in both the rural and urban
areas according to the NSS. Expenses made on healthcare are the most common
cause of non-production related indebtedness in the rural areas todav.
o
Diug costs form nearly 70% of out of pocket expenses of outpatient care, and
nearly 50% of inpatient care expenses
G
Deregulation of drug prices in the past has increased the drug prices, as
documented by committees appointed by the Government (DPCRC).
X—
I
5) Noi the leconiniendations ol the National ('oininission on Macroeconomics and
I Icallh, especially regarding irrational drugs, have be
been taken into account. (See
Annexure 1).
6) A Pharmaceutical Policy is for the whole nation: hence it should also have focus
(apart from encouraging industry) on removing irrational and harmful drugs and '
promotion of generic drugs especially those in the NEML These measures are
important for reduction in cost of health care. See How to develop and implement
a national drug policy. — 2nd ed. [Updates and replaces: Guidelines for
developing national drug policies (1988). WHO, Geneva.]
7) The National Pharmaceuticals Policy thus is to be seen a prime instrument to
operationalise some of the priorities already defined in the National Health Policy
(NHP 200,3).- The policy once again does not make this clear, and from the
parentheses in the document, which mention the need for the health ministry to
comment on the draft, it seems that that the policy has not gone through a detailed
process of consultation with the Ministry of Health. It thus seems to perpetuate an
untenable situation. India is one of the few (or probably the only) countries of the
world where the pharmaceutical policy is framed by a ministry other than (he
Health Ministry. Also it is a bit of contradiction that the DP 06 itself mentions the
lormation of an integrated ND I'A - hopefully the ND TA should come out with a
policy statement that reflects concerns of health in a national pharma policy.
8) I he benchmark for a National Pharmaceutical Policy is therefore its health
impact. There is enough evidence that, in spite of the stated objectives of
ensuring availability of good quality medicines at a reasonable price, the same
has not been achieved by previous policies; and in fact there have been severe
market distortions.'
9) A public website like in developed countries should give not only complete drug
information but also what are the drug prices of various brands/drugs. Along with
a medication error reporting service (the scope of the National
Pharmacovigilance Authority can be enlarged.) is required.
10) There is no comment on the criteria for introduction of new drugs (sec for
instance the British criteria of introduction of new drugs by of NICE
(ht!P^wwmice,oi^mk/)4. Or see the work of the National Prescribing Centre
2
It may be pointed out that it should be a tool for actualizing other national goals like making Indian
industry world class, etc. We agree but we submit that it will be a severe tragedy for the people of India to
have a world class industry and at the same time have a neglected health sector where essential drugs have
poor access and/or is unaffordable.
India m°re dlSCUSSiOn’ 566 L0C0ST/JSS: Impoverishing the Poor: Pharmaceuticals and Drug Pricing in
1 Currently NICE produces guidance in three areas of health:
*
xiuenOlrgy ,apPraisjais ’ g^dance on the use of new and existing medicines and treatments within the
NHS in England and Wales.
- 2. -
and National Horizon Scanning Centre of the UK? Indeed (he policy is silent on
Approval and licensing mechanisms of new drugs to be introduced.
I 1) New drug approval in the country could be decided by the proposed National
Drug Authority on the basis of safety, efficacy, public health relevance, cost
effectiveness or convenience of administration, of the new drug. Approval should
not be given if the new drug is more expensive, not more efficacious, than
existing alternatives. It should be a transparent process with details on reasons
accepted/rejected available to the public through a dedicated website. The letter of
approval for a new drug to be marketed in India, its approved indications,
contraindications, patient information material, etc., should be available on a
website and on request from the NDA. Any violation of the letter of approval
terms, should constitute a serious violation. The letters of approval of existing
drugs should also be made available for public viewing at a website. This is an
important step forward in increasing consumer and healthcare professionals
awareness.
12) A continued complaint is of state drug controller giving manufacturing licenses
for new combination drugs and formulations, even when they are not empowered
to do so. This should attract a strict penalty amounting to dismissal from service
(if spurious drug manufacturers can be thought to be 111 for the death row, this is
the least punishment one can effect on deliberately errant drug controllers). .
o
L
•
Some drugs in India (especially combinations) are not manufactured anywhere
else in the world, some drugs in the post-marketing state are found to be
hazardous, and have been banned or severely restricted in their use in othercountries. If India aspires to world-class status in the pharma sector it should also
conform to world-class standards of what is considered a rational, or safe drug.
The NDA should be mandated to respond within a period of 6 months in a
scientifically tenable manner to any complaint made by healthcare professionals
or civil society organization in the public interest, about the rationale of allowing
a particular drug to be marketed even though it is of dubious rationality and
efficacy^safety.
Interventional procedures - guidance on whether interventional procedures used for diagnosis or
treatment are safe enough and work well enough for routine use in England, Wales and Scotland.
" See for instance “The role of national agencies in the managed introduction of new
drugs for arthritis” in
Katrina Simister Ann Rheum Dis 2000;59(Suppl J):i38-i40 ( November)
3
13)The trade margins suggested may be reduced by l/3rds as they arc on MRP. If
MRP is higher trade margins would be higher - therefore there is here an
incentive to market high priced (likely to be irrational as well) drugs outside the
price control basket.
14) Also the crucial issue related to (13) above is how the govt is going to fix actual
costs of production, criteria for price control and decontrol, etc.
15) We reiterate that the earlier criteria were faulty because -
•
•
•
Any criteria based on MAT and cutoff is not very rational
As it excludes inevitably some very essential drugs
And some drugs which are virtual monopolies are out of price control
16) Price Control Criteria
• Price control/ceiling price criteria to be based on rationality, essentiality and
national security and
• Criteria and pricing policy should discourage production of drugs not in
NEML
• Generics should also be under price control if we want o encourage the use of
generics (which is what a rational drug policy should do).
17) Fiscal Incentives for Production of ONLY Rational, Essential and Generic
Drugs
The policy suggests fiscal incentives at places. We suggest fiscal incentives
be given for only essential drug production in the form of tax breaks, tax
exemptions, etc.
18) In addition, direct and indirect taxes on socially debilitating and disease causing
items like pan masala, tobacco products, alcohol, etc. may be increased (the
MOCF and M01IFW may have to strongly suggest these measures to the MOI'.
An integrated pharma policy has to look into health as a whole.
19) All incentives and policy regarding research and clinical trials should underscore
transparency, concern for human rights and ethics. The introduction of Clinical
trial registry is very important along with conflict of interest declarations among
all members of pharma related policy committees. Our proposed intention of
becoming world class industry should be accompanied by the highest standards of
ethics in research.
4
20) Mandatory Review of TRIPS: Doha had clearly mandated the review of TRIPS
under Art. 27.3(b) and 71.1.6 All references to this mandatory review have
disappeared in the Hong Kong declaration. India did raise the issue of biopiracy
and the need for the TRIPS amendment to have compulsory disclosure on sources
of origin of biological material and traditional knowledge. This does not find any
clear commitment in the Hong Kong declaration. The review of Art. 71.1 has
been conveniently substituted by making permanent the non-workable Para 6 of
the declaration on TRIPS and Public Health. It is all the more important therefore
that the draft pharma policy mention the importance of review of TRIPS and that
thcrS T’u8,1- com.inue t0 be a h‘gh Priority for India as it affects the availability and
affordability of drugs directly.
(This is being mentioned especially in the context of TRIPS compatibility to
be examined by Mashelkar Expert Group. If this Expert Group docs not suggest
this, the draft pharma policy must make a mention of the need for mandatory
review.)
7
21) Another Reason for Mandatory Review of TRIPS: As already pointed out,
drug prices and health care costs have become more unaffordable in the recent
years (despite motivated attempts by pharma industry lobbies to quote selectively
horn ORC, type studies). The Keport of the National Commission on
Macroeconomics and Health, Government of India, has also pointed this out. If
healthcare costs have risen because of increase in drug prices, it is a clear
indication of a lack of an effective national pharmaceutical policy. This situation
is slated to worsen with the onset of compliance with the TRIPS regime
We quote the National Health Policy (NHP 2003):
W'? ,tHe ad°Ption of Trade Related Intellectual Property Rights
(I RII S), and the subsequent alignment of domestic patent laws consistent
with the commitments under TRIPS, there will be a significant shift in the
scope ol the parameters regulating the manufacture of new drugs/vaccines.
Global experience has shown that the introduction of a TRIPSconsistent patent regime for drugs in a developing country results in
an across-the-board increase in the cost of drugs and medical services
( emphasis ours)NHP-2002 will address itself to the future imperatives of
health security in the country, in the post-TRlPS era.”
We expect therefore the Pharma Policy to address
health security in the post-TRIPS era.
the future imperatives of
The Doha Round cannot be considered complete without completion of the
mandatory review. Article 71.1 mandates a review every two years. It also
empowers the council for TRIPS to “undertake reviews in the light of any
relevant new developments which might warrant modification or amendment of
this agreement”.
22) Public-Private Partnerships These need to be carefully articulated. Whether
high prices, for instance of cancer drugs are justified need to be thought of. It
may be mentioned for instance that tamoxifen, an anti-cancer drug used in breast
cancer treatment is available at widely different prices from Rs 30 to Rs 120 -all
manufactured by reputed companies. The point we are trying to make is that anticancer drugs are as much irrationally priced like other drugs (same drug being
available at a vast range of prices.)
23) Skewed Focus on Cancer and AIDS
All diseases of public health importance need to be given importance. To chose
two diseases in particular out of the entire gamut of public health priorities is a
piece-meal approach which is against the interests of public health. In a country
where TB is the most important single killer and where the highest number of
MDR-TB patients exists, is it proper to exclude TB? Can one ignore newer drugs
for falciparum malaria, for diarrhea, for respirator}' tract infections, for
hypertension and diabetes (in which we have the highest prevalence in the world).
This piecemeal approach shall not even work for the cancer patients.
For
instance, cancer patients during chemotherapy can develop infections and for
which they require antibiotics which if made outside the purview of this system
will still inflate costs.
24) Income-tax and other exemptions may be given for those producing drugs for
all life threatening disease (and not only on cancer and AIDS) - PPP should not
become a way of unnecessarily subsidizing industry. 200 % weighted deduction
under 35 (2 AB) or equivalent may be thought of for all companies making only
generic, essential drugs as per the NEML 2003 (anot only for the so-called gold
standard companies, mentioned in pp 34-35.
25)The Rashtriya Bima Yojana (pp 27-28) although well intentioned, is not
practical and also may be a non-starter like the Universal Health Insurance
Scheme. It would mean in practice, one would go to a private practitioner or a
PIIC and take the prescription from one’s village to the nearest taluka level
chemist shop (imagine if the “medicine” is an anti-snake venom). It is a waste of
time and questions like cost of transport to first get the prescription and then the
drug - possibly travel in different directions, etc., would make this scheme
impractical and may not be therefore used at all. On the other hand, why not think
of enhancing the PHC drug budget and see that the PHC/CHC functions properly
and is stocked with medicines adequately.
26) User Fees: The Rajasthan Model (page 30) referred to has its source of income,
user fees. These user fees are substantial and create s dent in people's pockets.
There is strong evidence that direct and indirect user fees for primary education
6
and essential healthcare arc a barrier to access for the poor. Indeed, (he JelTrcy
Sachs chaired MUG Reports have recommended eliminating user fees for basic
health services in all developing countries, financed by increased domestic and
donor resources for health.7
27) It is indeed otherwise laudable that the draft policy recommends strongly the
replication of the Rajasthan Medicare Societies. We would recommend opening
of these stores even outside the premises of the hospitals akin to the State
Pharmaceuticals corporation of Sri Lanka.
28) The policy should have recommended equally strongly the replication of the
TN and Delhi models of bulk procurement in the public system all over the
country within a specific time frame, by which the public system will be able to
provide drugs free to an increased number of people without an increased
allocation.
Some other points which are missing from the draft:
29) Government’s stand on Essential Medicines concept is not clear.
Are Essential Medicines lists only to be prepared under duress of the Supreme
court like it was done in 1996, 2003.?
We strongly feel that the Pharmaceutical policy has to be rooted in the Essential
Medicines concept, which is a tried and tested measure to improve drug
availability and health outcomes. The Policy should promole and implement
selection of essential medicines, promotion of production of these drugs, ensure
availability of information about these drugs to the consumers and prescribcrs,
and promote rational use of these drugs. Essential medicines list should be
prepared every 2 years by a Standing committee made from various stakeholders
along with the National Drug Authority. It should also formulate standard
treatment guidelines for various levels of care, an Indian National Formulary
released every year, an updated source of information for the healthcare
professional which can be called the Indian Prescribcr, and should formulate and
review the various Drug Procurement documents in the country.
30) Lack of Monitoring Indicators: There is neither clear implemenation plan nor
any monitoring indicators in the daft policy. For instance, would the policy
undergo review if drug prices rise unacceptably? The policy should have
monitoring and review mechanisms in place for even other goals specified.
7 Report of the Task Force on HI V/AIDS, Malaria, TB, and Access to Essential
Medicines, Working Group on Access to Essential Medicines. Sterling, Va.: Earthcscan.
31) How and where does this policy address the traditional systems of medicines?
Without addressing this significant part of the pharmaceutical sector, how can it be
called a pharmaceutical policy. It should be called then the National Allopathic
Pharmaceuticals policy. Right now labeling a drug as ayurvedic is a tactic to escape
price control, or quality assurance.
32) Also there is no comment on the burgeoning multibillion rupee industry called
Nutraceuticals and how to regulate the runaway prices and irrational claims made
and how nutraceutcials add to the immiserisation wrought by seeking health care in
i
♦
'A
this country.
33) The introduction to the policy should do a frank situation analysis of the
pharmaceutical sector like the NHP did for the public health system.
Can the policy ignore the simple fact that India has one of the highest numbers of
formulations in the world (atleast over 20,000), which do not confer any health
benefit but rather waste people’s precious resources?
If part A is to consider issues other than statutory price control then it should be
addressing the issue of drugs which are not going to be subjected to price control,
fhe draft does not clarify the mechanism of price control and the content at all.
34) Promotion of prescribing information for doctors and rational use of drugs:
Mere production of drugs is not enough. They should be used judiciously in the
minimum number essential for the treatment of any illness. The policy should
mandate the publication of a regularly updated Indian National formulary,
standard treatment guidelines, to be distributed among all doctors, along with
regular prescription audits conducted al both public and private health facilities.
The policy should mandate provision of proper package inserts in medications
which conform to international standards.
35) Regulation of drug promotion and advertisements:
Wasteful and unethical promotion of drugs is inflating drug costs. 1 here should
be a strictly implemented code of conduct on promotion, acceptance of gifts, and
the manner of advertisements of drugs. The USFDA has well defined standards
on drug promotion, and their monitoring.
36) Price Control Complaints
The Drug price control monitoring cell should respond to complaints about price
variations made by healthcare professionals or consumer groups or civil society
organizations, and also forward them to the NDA.
»bo give page
37) Comment on 2.0
Past approach does not specify:
O
Why the number of drugs under price control were reduced?
° control?
™wp“wWhhhT
f'iMale f°I inclu?ing' e“'uding a drug f™”
al for example is the justification of excluding drugs for
anemia? diarrheatORS), ail TB drugs, all antimalarials, emfrom price
O What was the effect of deregulation?
38) Para 3.11 Excise Duty' payable on MRP (Maximum Retail Price), p 6
Why not make even VAT on a percentage of MRP?
39) Para 4.0 Key Policy Objectives, p 6
1 he following objectives may be added:
•
1 o complement the objectis es of the National Health Policy (NHP) 2003
• To discourage inessential drugs and irrational combinations
• To develop criteria (or suitable mechanisms) for new drugs to be allowed to
be manufactured/marketed in this country.
Rationale for above comments: The objectives of the policy should
be Health
objectives, Economic objecti ves and Development objectives.
The policy under this head, mentions in the last line that it shall facilitate
implementanon of the National Health Policy, without mentioning it as an objective
Ibjecd’veT 31 t,,e m°ment g‘VeS PnniaCy t0 econoinic objectives rather than health
A continuing bane of the Indian pharmaceutical industry has been the presence of
•rranonal and hazardous drugs and combinations which are wastino peopVs
resources and exposmg them to risk. A large of such drugs are being now
masqueraded as nutnt.onal
nutritional supplements.
supplements. The
The policy
policy should
should make a statenfent to
rm? h i such drugs which are dubious in terms of efficacy, safety relevance if it
truly believes thatjt will make the Indian industry world class. How can one justifithe sale of hundreds of brands of nimesulide suspension in children eamine crores in
revenue, when the same is banned for use below 12 years of age’by the^uropean
Jernes Evaluation Agency, and the drug is not available in US, UK or even
The policy should state that it
1■
2.
3.
■
3.
will be within the overall health policy of the country?
will be based on the Essential Medicines Concept?
will promote rational use of drugs by healthcare professionals and consumers?
will eliminate irrational and hazardous drugs from the pharmaceutical market?
will safeguard the rights of the patients/consumers.
40) Page 9: Constitution of NDA -hope it is not merely a name change of the CDSCO.
41) Page 10: NADT timeframe may be specified.
42) Page 10: Intellectual Property Rights including Data Protection
ta taeresied" exoeX T„' ** 8™ted-A" data filed
>h« public domain. So
ai interested experts in civil society may examine them for consistencv of
merpreianon. After Vioxx debacle, tmsiing pharma companies naively is „o”„ optio"
e have our own clinical Inal scams and
and scandals
scandals including
including the
the by
by now
now notorious
notorious Johns
opkins trials in Trivandrum in a Government institution.8
43) Clinical Trials and Drug Development
a' beh nndT21PO17TSUmCS: WrOngly in 0Ur °pinion’that certain data have to
■ f dls2.1°sed- Thls (understanding of non-disclosure) is not in the public
interest. There are no ethics, transparency issues discussed here. Thesf have
to be mentioned specifically upfront. World over the trend is to promote
openness. If we are going to be world class, let us have world-class ethical
See olh
d8 Q °f Unethlcal Drug TrlaIs> Editorial in MIMS India, Feb 2004
See also. Nundy, Samiran and Gulhati, Chandra M “A New ColonalKm?
d ,■
Trials in India”. N Engl. J Med 352- 16, April 21 2005 8 “Tohnc Ho V’
d ConductlnS
used Indian patients as guinea pigs”. BMJ2001; 323:1204 (24 November)3 mitS SC‘entlSI
Also see: -The truth of the 'drug' trials”. Frontline, Volume 18, Issue 24, Nov. 24 - Dec.
A Case of Betrayal" Frontline, Volume 22 - Issue 25, Nov. 05 - 18, 2005 In the same
issue a related report, “A award and some claims” reported:
’
have been convinced for
the marketing arm of
titled. -Sponsorship.
M Some edlmrs
“r,fs
Authorship, and Accountability
companies of distorting the tesults
leading medical journals accused diu
Lancet the NeW England
Of scientific research for the sake of p^ f
Association and
Journal of Medicine, the Join n /
their money . or the
other major journals accused tte drug gta
threat of its removal - to tie up
and fairly on the results of drug
::—
ixxxp“•
“y “
precious objectivity.
h. m the United States the Food
now requires that all tna
into
maintained by the National Institutes
™ls “re rcgiSKrcd dUn"S
°he iridal period of <he law's imp'emeoution.
c . Apart from a ‘clinical trials register tc’
be available in
SritXXS^vio^.Howsb.Uwe benefit ultimatei)
286. No. 10- September 12. 2001 and at
oO56.html>. The signatories were:
<http://jama.ama-assn.org/issues of]nternal Medicine', Catherine D.
F Jk DavdofL
D-zen. MD. editor-in-chief, Ne.
DeAngelis, editor. .LIMA.
■|^oev
editor< Canadian Medical Association
Efland Journal of Median.^ . H
ed.tor_.n chief Tilisskrifi for Den ^ke
Journal: Liselotte Hojgaara..
Association)-, Richard Horton. FRCP.
ioe^forenin}- (Journal of die
' ' utive editor, MEDLlNE/lndex Medicos;
editor. The Lancer. Sheldon Kolzin.
-■ ■
journal: Magne Nylenna. MD.
M. Gary Nicholls. MD. editor. New Aea,a id Jp M OverbekC) MD, PhD.
{DMch .humul of Medley.
edta-in-ehier. N«weeiu» M«lrf
SS5 C« X.
“'s
taXional Comndnee of
“Beyond Trial Registration: A Global Trial
'"Statement by 13 editors, op.cit.
I!
,lK dr"6s be provided “ ’
Xe'z:
-
44) Anticancer Drugs, Anti-HIV/AIDS Drugs, pp 12 and 13
What is so special about cancer? There are a whole lot of diseases (diabetes for example
debihtatmg physically and financially life-long and there are 7 million diabetes paZs
similar pXential^a^nt00^’ C°mmUn,Cable and non-communicable, that require
pp)13P14bllC'PriVate Partnership Pr°gramme for Anti-Cancer and Anti-HIV/AIDS Drugs”
e are afraid this is very wishy-washy and without details thought through and expecting
a so that Industry and trade would be asked to reduce their margins - both profit and
(Xe'r "id)5 t0 'l JTS1 TH'T1 leVe’ 3nd PaSS °n the benefit t0 the consi>mers “
(p ge la-14) is wishful thinking. Trade and industry' have never been known to pass on
benefits and concessions given.
p
Why not say all such drugs there will be ino product patents applicable (is consistent with
Doha and WTO) or CLs would be issuedI as a matter of course.
46) Prices of Drugs for Other Life Threatening Diseases (page 15)
We feel that there are two options with regard to the list of drugs that need prefential
treatment.
The first and the preferred option are to have a list of categories of drugs that
acdress kej disease and healthcare problems and which shall be under price control.
I he second option if the first is not considered operationally suitable, is to have a
core hst of drugs for pr.ee control which arc drawn from kev categories and «
supplementary hst of drugs whose prices, trade margins and market shares shall be
he W orld Health Organization's department for Technical Cooperation for
Lsscnual Drugs and I raditional Medicine (TCM) and UNDP have recentiv published a
paper written by James Love entitled. "Remuneration guidelines for non-voluntarv use of
a patent on medical technologies". The reference of this paper is "WHO/TCM/2005 1"
and is number 18 of the TCM Series on Health Economics and Drugs. See
.Ypdl
1111 C'1l'tV nledicincs areas/technical coo|->eration/W;HQ 1CM2005.1 QM
I
closely monitored and brought under the ambit of price control based on their quantum of
sales, market share, price movements, trade margins.
The National List of Essential Medicines 2003 represent a selection of the
efficacious, safe, and cost-effective medicines for the priority conditions affecting health
in India. Therefore the National List forms a sort of reference list from which the list of
drugs to be placed under price control has been drawn. (Please see Annexure 1 for a
suggested list.)
47) Trade Margins (para 6, page 16)
These are way too generous, and dangerous, and since they are based on MRP, the trade
will veer towards costlier drugs in the same class and costlier brands of the same drug.
We suggest reduce the margins by at least l/3rds. And establish a general ceiling on
maximum retail prices and/or post-manufacturing margins using benchmarking based on
well-run procurement systems as suggested by the Pronab Sen Task Force.
48) Excise duty relief (para 7, p 17) Should be given only for generic drugs NEML.
Aim of fiscal incentives should be to promote rational drugs (or let us say drugs in
NEML). Excise duty relief etc., is seldom passed on anyway.
49) MRP inclusive of Taxes (para 8, p 17) Very desirable.
50) “10. Drugs and Therapeutics ( Regulation ) Act”, pp 18-19
10 e) We suggest a brand registry for all drugs, foods and cosmetics (including
pesticides and veterinary drugs) as common salt can be mistaken for antiepileptics
( ...a presciiption was written for Lona, a brand or antiepilepsy drug clonazepam
marketed
by Triton Healthcare Private Limited, Chennai. The ’’patient” was sold Lona, exactly
as prescribed, but it contained low sodium salt marketed by Oabur and meant
for hypertensives’” (Source: Editorial in MIMS India, Oct 2004). '
51) Bulk Procurement system for Drugs by Government, para 12, pp 21-22
“Procurement preferably in the form of generic drugs” - -may be changed to "quality
generics unless otherwise not available" and 80 percent of drugs procured must be from
only those given in the NEML 2003 or equivalent.
52) “13.0 Lower Prices for bulk purchases by Government”, p 22
a. Has to be seen what is the ceiling price mechanism.
b. “For drugs other than those under cost based price control and patented drugs
-a ceiling price of 50% of MRP of the drug.” This should not be the final
'3
criteria for price as sometimes market prices of drugs not in control could be
way high.
53) “14.0 Promotion of Generic Drugs”, pp. 22-23
“Quality certification would be provided free of cost to generic drug
manufacturers through an appropriate scheme” — how do you define a generic
manufacturer? As there are very few or almost zero generics only mfrs. Also is
this free quality certification for each drug or for the whole manufacturing
facility?
54) “15 Control on Pharmaceutical brands”, p 23
Misbranding comments are well-made. There is need to close escape hatches like if a
brand drug comes under price control, one cannot make a near equivalent with a near
sounding brand name. Also brand names of banned drugs cannot be used again (for
example Baralgan became Baralgan plus etc). To escape price control of brands
brought newly under price control, new brands with almost near sounding names and
almost equivalent formulation should not be allowed (Becosules became Becosule
plus).
There is nothing on debranding advocated by the Pronab Sen Committee.
55) T6. Quality Certification of drugs”, p 24.
Bioequivalence and bioavailability should not become a trade barrier. It can become a
trade barrier if in vivo testing (in the human body) is insisted upon in contrast to in
vitro (“in the test tube”).
56) 20 c, page 30: the Rajasthan Model seems to have some problems -these should be
taken care of when extending this idea. (See Roy Chaudhury, Ranjit and Nirmal
Kumar Gurbani. Enhancing Access to Quality Medicines for the Underserved.
Anamaya Publishers. New Delhi, 2004.)., The user fees issue has already been
pointed out.
57)
“25. Development of Orphaned Drugs”, p 37
Definition of orphaned drugs is not what is normally understood.
58) “Gold standard Companies”, p 35
Definition of gold stnd cos. - only a handful would be able to make the grade
honestly that is. Can good R &D not be done in a smaller scale?
59) “26 Scheme of Interest Subsidy for implementation of Schedule M of Drugs and
Cosmetics Rules for Good Manufacturing Practices”, page 37
Schedule M deadlines are past. What are you going to use the money for? May be for
the new certification of quality (like AG mark) being talked about?
60) “28.0 Settlement Commission” , p 38
Price Monitoring and Public Awareness need not wait for crumbs from the Settlement
Commission as and when. This is an important activity that needs to be funded
anyway.
Annexure 1
Report of the National Commission on Macroeconomics and Health (extracts)
During September 2005 another important Government appointed commission gave its
report. Among other things it observed that:13
.Ten of the top 25 drugs sold in India are non-essential, irrational or hazardous.
I he market for drugs is highly concentrated with implications on price setting.
Price of drugs
Only 76 drugs accounting for around one-fourth of the drug market are under
price control. An examination of the price trends of 152 drugs (consisting of 360
formulations) reveals that antibiotics, anti-tuberculosis and anti-malarial drugs,
and drugs for cardiac disorders, etc. registered price increases from 1 %-l 5% per
annum during 1976-2000. Indian households spend 50% of their total health
expenditures on drugs and medicines. Reducing this burden and ensuring access
can be achieved by: (i) bringing all drugs under price control to ensure lower
prices for the households; (ii) streamlining and putting in place a system of
centralized pooled procurement of drugs so that the public health system can save
almost 30% to 40% on costs; (iii) weeding out irrational drugs and irrational
combination drugs: and (iv) encouraging ISM drugs for treating diseases for
which efficacious and low-cost drugs are available. Price control, as is the
practice in several countries such as Canada, is justified on the basis of the drug
prices outstripping WPI. Second, this will address about 90% of the health needs
of the community and reduce household spending on these services. Price control
should not be limited to essential drugs as the industry can then simply switch its
production to the non-controlled categories, depriving people of access to
essential drugs....
Access to affordable drugs14
1' Executive Summary of the Report ofthe National Commission on Macroeconomics and Health,
Government of India.
It is difficult to predict the impact of the Patent Act on the access to drugs, both in
terms of price as well as availability. At the time of the writing of this report,
there are various scenarios emerging, ranging from cautious optimism to
downright pessimism. Given the agreed position on the necessity to ensure that
we safeguard this basic and fundamental right to access to essential medicines,
there is need to carefully study experiences of other countries and coping
strategies from the patients' and not only the commercial point of view. We see
the Governments role to be very critical in being able to exploit the strengths and
minimize the threats that are inherent in this Act.
•
Expand price control of all drugs and mandate use <of" only
\ generic drugs in all
publicly funded programmes. Such price caps will help contain costs.
•
Weed out irrational drugs and irrational combination drugs to substantially
reduce household drug expenditures.
•
A minimum VAT of 1% as against the proposed 4% should be levied for
essential drugs
•
Fix ceilings on trade margins as suggested by the interim report of the Sandhu
Committee.
•
Centralized pooled procurement reduce government expenditure by over 30%50%.
50
/o. For this, we recommend adoption of the TNMSC model throughout the
country.
•
The recommendations of the Mashelkar Committee regarding setting-up of
the National Drug Authority (NDA) with an autonomous status to take up the
functions of drug pricing, quality, clinical trials, etc. need to be implemented
without delay. Consequently, the present National Pharmaceutical Pricins
Authority (NPPA) could be merged with the proposed NDA and Central
Government provide assistance to states for strengthening the drug regulatory
system.
•
The Patent Act passed recently needs to clarify the scope of patentability;
reasonableness of royalty to be paid on the issuance of compulsory7 licensing;
definition of’significant’ for the Indian companies manufacturing these drugs,
mechanisms lor automatic compulsory licensing and strengthening of the
regulatory bodies to ensure that drug
Annexure 2
14 Recommendations of the Report of the National Commission on Macroeconomics and Health,
Government of India.
OPTION A -DRUG PRICE CONTROL BASED ON THERAPEUTIC
CATEGORIES AS DEFINED IN THE NATIONAL LIST OF ESSENTIAL
MEDICINES
The National List of Essential Medicines 2003 as well as the WHO List of Essential
Medicines mentions 27 categories of drugs. Of these for the purpose of price control 17
categories have been selected. The categories chosen represent drugs required for the
public health problems, for common conditions in health care, categories in which drugs
are at present expensive or there is evidence of overpricing. All drugs included in these
therapeutic categories are proposed to be covered by price control.
I. ANTIINFECTIVE MEDICINES: (includingAntihelminthics, Antibacterials including betalactam
and other antibactenals, antileprosy , antituberculosis, Antifungals, Antivirals, Antiprotozoals),
II. MEDICINES AFFECTING THE BLOOD: (Antianemia
coagulation)
medications and medicines affecting
HI. CARDIOVASCULAR MEDICINES( Antianginal, antiarrhythmics, antihypertensives, medicines used
in heart failure, antithrombotic medicines)
IV. MEDICINES ACTING ON RESP.TRACT.(antiasthmatic medications, antitussives)
V. HORMONE OTHER ENDOCRINE MEDICINES, CONTRACEPTlVES.(including antidiabetics and
thyroid and antithyroid medicines)
VI. 1MMUNOLOG1CALS (including sera and immunoglobulins, and vaccines)
VII. GASTROINTESTINAL MEDICINES (including antacids and anti-ulcer medications, antiemetics
antiinflammatory medicines, medicines used in diarrhea)
VIII. PSY CHOI HERAPEUTIC MEDICINES (including medicines used in psychotic disorders, mood
disorders, generalised anxiety and sleep disorders)
VIII. ANTICONVULSANTS/ANTIEPILEPTICS:
IX. AN IINEOPLASTIC, IMMUNOSUPPRESIVES, AND MEDICINES IN PALLIATIVE CARE
X. ANALGESICS, ANTIPYRETICS,
RHEUMATOID DISORDERS
NSAIDS,
DISEASE
MODIFYING
XI. AN! IALLERGICS AND MEDICINES USED IN ANAPHYLAXIS.
XII. BLOOD PRODUCTS AND PLASMA SUBSTITUTES
XIII. DERMATOLOGICAL MEDICINES
XIV. DISINFECTANTS AND ANTISEPTICS
XV. DIURETICS
/7
AGENTS
USED
IN
XVI. OPHTHALMOLOGICAL PREPARATIONS
XVII. VITAMINS AND MINERALS
E: OPTION B
A core list of drugs from key therapeutic categories to be under price control and a supplementary
list comprising alternatives from the same therapeutic categories whose prices will be rigorously
monitored.
LIST 1: CORE LIST
ANALGESICS, ANTIPYRETICS, NSAIDS, DISEASE MODIFYING AGENTS USED IN
RHEUMATOID DISORDERS
Non-opiod analgesics, antipyretics, Non-steroidal anti-inflammatory medicines
1) Acetyl salicylic acid
2) Ibuprofen
3) Diclofenac
4) Nimesulide
5) Paracetamol
Opiod analgesics
6) Morphine
7) Pentazocine
8) Pethidine hydrochloride
Disease modifying agents used in rheumatoid disorder
9.Methotrexate
lO.Sulfasalazine
ANTIALLERGICS AND MEDICINES USED IN ANAPHYLAXIS.
11) Pheniramine maleate
12) Cetrizine
13) Dexamethasone
14) Hydrocortisone
15) Prednisolone
AN T1CONVULSANTS/ANTIEPILEPTICS:
16) Carbamazepine
17) Diazepam
18) Phenytoin sodium
19) Sodium valproate
Antihelminthics
20
Albendazole
21
Pyrantel pamoate
Anti-bacteriais
a. Betalactam antibacterials
22 Amoxicillin
23 Ampicillin
ANTI1NFECTIVE MEDICINES
24 Benzathine penicilin
25 Benzyl penicillin
26
27
28
29
Cefotaxime
Ceftriaxone
Ceftazidime
Cloxacillin
Other antibacterials
30 Amikacin
31 Gentamicin.
32 Azithromycin
33 Cephalexin
34 Clarithromycin
35 Chloramphenicol
36 Ciprofloxacin
37 Cotrimoxazole
38 Doxycycline
39 Erythromycin
40 Metronidazole
41 Norfloxacin
42 Vancomycin
Antileprosy medicines
43 Clofazimine
44Dapsone
Ethambutol
Isoniazid
Ofloxaxin
Pyrazinamide
Rifampicin
50 Streptomycin
45
46
47
48
49
Antituberculosis medicines
Drugs for drug resistant TB:
51 Cycloserine
52 Ethionamide
53 Kanamycin
54 Capreomycin
Antifungal medicine
55 Fluconazole
56 Griseofulvin
57 Amphotericin B
Antiviral medicines
Antilicrpes
58 Aciclovir
Anti retrovirals
59 Lamivudine
60 Stavudine
77
61
Zidovudine
62 Efavirenz
63 Nevirapine
64
Non-nucleoside reverse transcriptase inhibitor
Protease inhibitor
Indinavir
65 Nelfinavir
66 Ritonavir
67 Saquinavir
ANTIPROTOZOAL MEDICINES
Anti amebic and antigiardiasis medicine
68 Diloxanide furoate
69 Metronidzole
70 Tinidazole
71 Pentamidine isoethionate
72 Sodium stibogluconate
73
74
75
76
'll
Anti-Kala azar medicine
Antimalarial medicines
>Artemisinin
...............................
derivatives, (artesunate. aretemether. etc)
Chloroquine phosphate
Primaquine
Quinine
Sulfadoxine+ Pyrimethamine
78N™Sp^num0’ IMMUNOSUPPRES'VES, AND MEDICINES IN PALLIATIVE CARE
79 Inj. Doxorubicin
80 Inj. 5-Fluorouracil
81 Tamoxifen
82 Ondansetron
Palliative care
MEDICINES AFFECTING THE BLOOD:
Antianemia medications
83 Ail iron salts and iron containing compounds
84 Folic acid
85 Vitamin B|
86 Combinations of iron containing compounds with folic acid with/without other ingredients.
Anti anginal medicines
87 Isosorbide dinitrate
88 Isosorbide mononitrate
89 Metoprolol
90 Propranolol
^1 Glyceryl trinitrate
CARDIOVASCULAR medicines
Antiarrhythmic medicines
92 Amiodarone
93 Adenosine
2-^
GASTROINTESTINAL MEDICINES
Antacids, Anti-ulcer
123 Aluminium hydroxide, magnesium hydroxide
124 Ranitidine
125 Famotidine
126 Omeprazole
Antiemetics
127 Domperidone
128 Metoclopramide
Laxatives
129 Bisacodyl
130 Isphagula husk
Medicines used in diarrhea
131 Oral rehydration salt
HORMONE, OTHER ENDOCRINE MEDICINES, CONTRACEPTIVES.
Contraceptives
132 Ethinvlestradiol+levonorgestrel
133 Ethinylestradiol + norethisterone
Anti-Diabetic
134 Glibenclamide
135 Glipizide
136 Gliclazide
137 Glimepride
138 Pioglitazone
139 Insulin (Soluble) bovine/porcine/human
140 Intermediate acting Insulin (Lente'NPH) bovine/porcine' human
Thyroid and Antithyroid medicin
141 Carbimazole
142 Levothyroxine
IMMUNOLOGICALs
143 Anti-D immunoglobulins
144 Anti-snake venom
145 Anti-tetanus horse/human
146 Dipthcria antitoxin
147 Rabies immunoglobulin
Vaccines
148 Hepatitis B vaccine
149 Hemophilus influenzae vaccine
150 Rabies vaccine cell culture, purified chick embryo, vero cell
OPHTHALMOLOGICAL PREPARATIONS
151 Sulphacetamide sodium
152 Tetracycline hydrochloride
Anti-glaucoma medications
153 Beiaxolol hydrochloride
21
94 Lignocaine hydrochloride
95 Mexiletine
96
Diltiazem
Antih\ pertensives
9“
Amlodipine
98 Atenolol
99 Enalapril
100 Thiazide diuretics.
10: Losartan
Medicines for heart failure
102 Digoxin
103 Frusemide
104 Dobutamine
105 Dopamine
Antithrombotic medicines
106 Streptokinase
10“ Clopidogrel
108 Heparins including low molecular weight heparins.
DERMATOLOGICAL medicines
Antifungal
109 Miconazole
110 Ciotrimazole
Antiinfective
I 1 1 Framycetin sulphate
1 12 S: \er sulphadiazine
1 13 Betamethasone dipropionate
Antiinflammatory
1 14 C.obetasone
I 15 C'obetasol.
I 16 Gamma Benzene hydrochloride
Scabicides
I 17 Benzyl benzoate
118 G.utaraldehyde
DILRETICS
1 19 Mannitol
120 Spironolactone
121 Amiloride
122 Triamterene
disinfectants and antiseptics
Disinfectants
154 Pilocarpine
155 Timolol
PSYCHOTHERAPEUTIC MEDICINES
Medicines for psychotic disorders
156 Chlorpromazine
157 Haloperidol
Medicines in depressive disorders
158 Amitryptiline
159 Fluoxetine
160 Imipramine
Medicines in bipolar disorders
161 Lithium carbonate
Medicines in anxiety
162 Alprazolam
MEDICINES ACTING ON RESP.TRACT.
Anti-asthma medicines
163 Beclomethasone dipropionate
164 Salbutamol sulphate
165 Salmeterol
166 Theophylline compounds
Anti-tussive
167 Codeine
168 Dextromethorphan
VITAMINS AND MINERALS
169 Calcium salts
170 Multivitamin combinations.
171 Nicotinamide
172 Pyridoxine
173 Riboflavine
174 Thiamine
175 Vitamin A
176 VitaminDj (ergocalciferol)
OPTION B: LIST 2
SUPPLEMENTARY LIST OF DRUGS AND THEIR THERAPEUTIC CATEGORIES FOR
RIGOROUS MONITORING OF PRICES
I.
Anti-bacterials: ( Penicillins like Amoxicillin-clavulanic acid, piperacillin. Cephalosporins like
cefoperazone, cefixime. cefepirome. cefhidir. quinolones like gatifloxacin, levofloxacin,
monobactams like aztreonam, carbapenems like imipenem etc)
11.
Analgesics and Non-steroidal anti-inflammatory' drugs:
(e.g. COX-2 inhibitors and others)
111.
Drugs used in Rheumatoid arthritis: (Leflunomide, etc)
IV.
Antiallergics : (Fexofenadine, Loratadine, etc)
V.
Anticonvulsants (including gabapentin, lamotrigine, topiramate, clobazam, and others)
y
VI.
Immunosuppressives Hke Azatiiioprine, Ciclosporin, etc.
VII.
Cytotoxic medicines: (Bleomycin. Busulphan.Cytosine arabinoside,Danazol, Flutamide.
Hydroxy urea. Paclitaxel etc)
VIII.
Antiparkinsonism medicines like Levodopa-carbidopa, Bromocriptine,Piribedil)
IX.
Medicines affecting coagulation
Coumarin derivatives
X.
Antihypertensives: (Beta blockers like carvedilol etc, calcium channel blockers like
nifedipine, sodium nitroprusside. ACE inhibitors like lisinopril, ramipril, other Angiotensin
receptor antagonists, and others)
XI.
Diabetes mellitus: (Repaglinide. Rosiglitazoine, Acarbose,etc)
XII. Immumnologicals Combinations of DPT with Hemophilus/Hepatitis
Varicella vaccine
XIll.
Gastrointestinal medicines: (Proton pump inhibitors, drugs for H.pylori)
XIV.
Medicines affecting the respiratory tract: (antiasthma medications like Budesonide,
Fluticasone. Ipratropium. Montelukast. etc)
XIV. Psychotherapeutic medicines (newer sedatives, newer antidepressants, new antipsychotics )
XV. Solutions affecting water, electrolytes.
XVI Vitamins (all combinations of vitamins. Methyl cobalamin, Calcitriol)
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RF_DR_35_A_SUDHA.pdf
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