NPPA allows drug firms to raise prices of essential medicines from April 1

Effectively the prices of 651 medicines will come down by 6.73%; WPI-linked price rise allowed this fiscal is 12.2%; about 870 formulations fall under the essential category


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Sohini Das Mumbai

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The National Pharmaceutical Pricing Authority (NPPA) said on Monday that drugmakers have been allowed to increase prices by up to 12.2 per cent of essential medicines from April 1, based on the change in the wholesale price index (WPI).

Essential medicines are those that are part of the National List of Essential Medicines, and are called scheduled drugs. There are around 870 essential medicines in the NLEM.

The NPPA said that out of this ceiling, prices have been fixed for 651 medicines, and as a result, there has been a 16.62 per cent cut in prices. Since the announcement of NLEM 2022 and consequent Schedule 1 Amendemt NPPA , as per provisions of DPCO 2013 had revised the ceiling prices. 

Therefore, now that a 12.2 per cent gross surge in prices has been allowed, it works out to an effective price drop of about 6.73 per cent.

Last year, the NPPA had allowed the pharmaceutical industry to raise prices by about 10 per cent.

“The WPI, while increasing the price of the drugs, may also help the industry take care of increases in costs and others. This is the highest WPI ever--last year it was around 10 per cent,” said Hari Natarajan, founder and managing partner at Pronto Consult, a market research firm for the pharmaceutical industry.

In 2016, drug firms reduced prices of scheduled drugs as the annual change in WPI was minus 2.71 per cent in 2015 over the previous period.

Groups had lobbied with the NPPA for drug prices to be increased, citing a steep rise in input costs. In July 2021, the NPPA allowed a one-time price rise of 50 per cent for three key drugs that are used as the first line of treatment:- ibuprofen (analgesic), ranitidine (antacid) and carbamazepine (epilepsy).

First Published: Apr 03 2023 | 6:43 PM IST

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