Violations of Drug Price Control Order

A proposal to set up price monitoring cells in state drug control administrations for tracking violations of Drug Price Control Order was made by the ministry of chemicals some months ago. The proposal was made in the context of increasing number of price violations and circumvention of DPCO by a large number of pharmaceutical companies over the years.

As per the latest data compiled by ORG-IMS, the number of prima facie violations were rising steadily in the recent years. From 2007 to November 2010, 2782 samples of non-scheduled drugs were collected and prima facie violations were detected in as many as 1495 cases. Out of these, 956 samples were referred for overcharging. Similarly, out of the 309 samples collected from the market during June 2009 to March 31, 2010, in 153 cases the companies were found to have violated the norms and 139 were referred for overcharging. However, only 14 samples finally came under price fixation. During the current year up to November 2010, 348 samples were collected from the market and 125 were found to be with prima facie violations. It is extremely difficult for NPPA to detect such growing number of violations all over the country considering its current staff. NPPA put up the proposal to set up price monitoring cells in the state was in this context. It is unfortunate that the Planning Commission is yet to act on the proposal.

The chemicals ministry has been regulating prices of 74 drugs since 1995 through NPPA and later it also started monitoring prices of several non scheduled drugs as many of them remained outside the price control in the absence of finalization of a new drug policy. Formulations of over 500 drugs are being marketed in the country by 5000 companies. Now, as the Planning Commission is taking its own time to consider the NPPA’s proposal, the regulatory body feels that building its own team of officers to pick up random samples from the market would be a better option. It has, therefore, urged the Pharma Department to process the files for creating its own cells in the States.

In fact, this is one of the key suggestions made by the chemicals ministry to be incorporated in the long pending national pharmaceutical policy. Currently NPPA has very limited staff available to it but still it monitors the prices of non scheduled formulations through various methods like scrutiny of price lists submitted by manufacturers, analysis of monthly Stockists Secondary Audit Reports published by IMS-Health and complaints and references received from official and non- official sources. Considering the massive number of formulations in the domestic market and with only a small number of them coming under price fixing by way of scheduled drugs, the quantum of samples needs to be increased for better price monitoring and strengthening of NPPA with own monitoring cells would be a better option.