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A GENUINE GRIEVANCE

Ramesh Shankar
Wednesday, August 28, 2024, 08:00 Hrs  [IST]

The pharmaceutical industry associations in the country have once again urged the Department of Pharmaceuticals to implement prospective batch pricing to avoid Drug Prices Control Order (DPCO) based litigations. At present, once ceiling prices are notified by the national drug price regulator, the National Pharmaceutical Pricing Authority (NPPA), the revised ceiling price is mandatorily made applicable with immediate effect, putting the pharmaceutical companies in real quandary. This sudden implementation poses considerable challenges for the pharmaceutical companies, particularly in ensuring that more than nine lakh pharmacies across the country promptly adjust their pricing structures. Overnight ceiling price implementation is well nigh impossible as the pharma companies will not be able to take the onus of informing and coordinating with more than nine lakh chemists and druggists spread across the nook and corner of this vast country. It is beyond the scope and reach of any company. The pharma companies can enable the price change till Carrying and Forwarding (C&F) Agents, depots and stockists, but these companies have no control over nine lakh chemists in the country leading to litigations even if one strip is found with the old rate with the chemist after 3 to 4 months. The industry associations have been raising the concern that even if a single retailer in the country is found with one unit of formulation with a price higher than the newly notified ceiling price, then the pharma companies are held responsible and are subsequently issued overcharging notices by the drug price regulator, leading to show cause notices and legal cases. So, the applicability of ceiling prices should be done from the immediate prospective batch towards compliance to DPCO-2013.

The industry associations have now proposed that pricing changes be applied to future batches, easing compliance burdens and allowing timely adjustments through the Integrated Pharmaceutical Database Management System (IPDMS 2.0), which was introduced by the NPPA to streamline operations by centralizing submissions required under the DPCO-2013, ensuring accurate and timely price revisions across scheduled and non-scheduled formulations and active pharmaceutical ingredients. The industry associations have proposed that pricing adjustments should apply to future batches of pharmaceutical products to facilitate smoother compliance with DPCO guidelines by allowing manufacturers to implement changes gradually through the IPDMS 2.0 which serves as a centralized platform for the submission of pricing information and other regulatory requirements mandated by the DPCO-2013. To overcome this genuine issue, para 2(e) of DPCO-2013 should be modified to delete the word 'Retailer' from the definition of the 'Dealer' as the pharmaceutical companies have no control over prices charged by the retailers. As per the current DPCO-2013, ‘Dealer’ means a person carrying on the business of purchase or sale of drugs, whether as a wholesaler or retailer and includes his agent. Immediately after the price revision, each company intimates its C&F/super stockists and stockists and also submits Form II and Form V price lists on the IPDMS site as per the DPCO guidelines. But unfortunately, even if a single strip of a scheduled formulation is found at a retail counter with a price higher than the notified price, the company is issued notices for overcharging despite the fact that the company has no direct agreement with the retailer. The industry’s demand looks genuine. To resolve this issue, the system of prospective batch pricing should be enabled so that the notified ceiling price is effective from the next manufactured batch and is not applicable on market stocks manufactured prior to the notification.

 

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