#India – Govt has no plans for National Health Bill #WTFnews

PIB RElease, March 22, 2013

The Government has no plans to introduce National Health Bill. In order to
provide relief to the common man in the area of healthcare, a countrywide
campaign in the name of “Jan Aushadhi Campaign” has been initiated by the
Department of Pharmaceuticals, in collaboration with the State Governments,
by way of opening up of Jan Aushadhi Generic Stores in the Government
Hosptials to supply of generic medicines through Central Pharma Public
Sector Undertakings, to make available quality generic medicines at
affordable prices to all. So far, 149 Jan Aushadhi Stores have been opened
in different States/UTs in the country as on 28.02.2013.

Further, under the provisions of the Drugs (Prices & Control) Order, 1995
(DPCO, 1995), the prices of 74 bulk drugs listed in its First Schedule and
the formulations containing any of these scheduled drugs are controlled.
National Pharmaceutical Pricing Authority (NPPA) fixes or revises prices of
scheduled drugs/formulations as per the provisions of the DPCO, 1995. In
respect of drugs not covered under DPCO, 1995 i.e. non-scheduled drugs,
manufacturers fix the prices by themselves without seeking the approval of
the Government/NPPA. However, the trend in prices of non-scheduled drugs is
monitored and suitable action is taken by NPPA where price increase is more
than 10% in a period of one year on moving basis.

The National Pharmaceutical Pricing Policy -2012 (NPPP-2012) notified on
07.12.2012 provides all the manufacturers/importers manufacturing /
importing the medicines as specified under National List of Essential
Medicines 2011(NLEM-2011) shall be under the purview of price control. The
objective of NPPP-2012 is to put in place a regulatory framework for
pricing of drugs so as to ensure availability of required medicines
essential medicines” at reasonable prices.

The Government is also providing support to the States under the NRHM for
providing free Generic Drugs in Public health facilities. States have been
encouraged to bring out essentials Drugs lists (EDL) facility wise and
Standard Treatment Guidelines to promote safe and efficacious drug use.

This information was given by Minister of State for Health & Family Welfare
Shri AbuHasem Khan Choudhuryin written reply to a question in the LokSabha


#India- How Pharma Giants Use Litigation To Evade Fines

Big companies overprice medicines and often get away with it by resorting to longwinding court cases
Shonali Ghosal


2013-03-30 , Issue 13 Volume 10

Unaffordable? Pharma companies are yet to pay 90 percent of the fines for overpricing drugs, Photo: AFP

Pharma companies have been fleecing the consumers by overpricing their medicines. As of 31 January, the total amount overcharged by companies stands at a mind-boggling Rs 2,596 crore, according to the National Pharmaceutical Pricing Authority (NPPA). This figure is for the period since 1997 when the regulatory body was set up. On the other hand, the amount recovered by the NPPA stands at a measly Rs 234 crore — just 9 percent of the total.

Cipla tops the list of defaulting companies and owes the regulator fines amounting to Rs 1,684 crore. According to the list of erring companies and the recoveries made from them (available on the NPPA website), the pharma giant figures in 16 different instances of overpricing . Despite sending out demand notices, the regulatory body has failed to get Cipla to pay up even in a single instance.

The second major defaulter is Ranbaxy, which has already paid Rs 30 crore in fines, but still has dues pending of Rs 105 crore.

Under the Drugs (Prices Control) Order (DPCO) of 1995, the NPPA is empowered to regulate prices of medicines that use 74 out of the 500 commonly used bulk drugs (active pharmaceutical ingredients in medicines). These 74 drugs are mentioned in the  National List of Essential Medicines of India. When companies overprice these drugs, the NPPA can recover the overcharged amount in addition to an annual interest of approximately 15 percent as per the Essential Commodities Act.

However, once the company challenges the decisions in court, the case drags on as the DPCO does not allow for out-of- court settlements. One contention commonly raised by companies is that the composition of the medicine they produce and market is different from what is mentioned in the notification.

Companies also argue that they are a small-scale industry and therefore exempt from regulation, or that the stipulated price for the composition was not known at the time they introduced the medicine in the market.

As a result, more than 90 percent of the pending fines remain unpaid and locked up in lengthy litigation.

Though most other companies have either paid or have started paying their fines, Cipla has at least three cases stuck in various high courts and the Supreme Court. Consequently, the penalty for overcharging keeps rising every year with the annual interest adding up. Sources say the Supreme Court has asked for all of Cipla’s cases to be sent to it so they may be disposed together.

Some like Delhi-based RTI activist Afroz Alam Sahil raise questions about the efficacy of the NPPA itself. In response to an RTI petition filed by him last year, the NPPA said it does not have a compiled list of drugs and pharmaceutical companies, and asked him to look up the Directory of Pharmaceuticals Manufacturing Units in India on the Internet. “How do they monitor companies they do not have a record of?” asks Sahil.

Replying to another question in the petition, the NPPA stated that the sampling that was done to check if any drugs were actually being sold at rates higher than their MRP was mostly confined to the Delhi region in 2012. “That allows companies to contest the quality of sampling as their drugs are sold all over the country,” says Sahil. “How can the NPPA care only about drugs sold in and around Delhi?”

Though the Ministry of Chemicals and Fertilisers is set to enforce a price cap on 348 ‘essential medicines’ as opposed to the existing 74 bulk drugs on the essential medicines list, this step can contribute to the reining in of drug prices only if the NPPA is able to recover fines from defaulting companies. Currently, about 1,000 formulations that include the 74 essential bulk drugs are under price control.

Along with the proposed expansion of the list, a new Drugs Prices Control Order would also be in place to directly check the price of specific formulations.

While Ranbaxy did not answer TEHELKA’s queries, saying “the matter is sub judice and we cannot comment”, Cipla has not responded despite several calls and emails over the past two weeks.




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