Big relief to cancer patients: 137 medicines will be cheaper by 70%, NPPA imposed a strict cap of 30% on profits.

The Central Government has taken a historic and humanitarian relief decision for lakhs of patients and their families across the country suffering from a deadly and long-lasting disease like cancer. Often, due to huge bills for medicines and injections for cancer treatment, middle class and poor families lose their life savings and get trapped in serious debt. To overcome this humanitarian and health crisis, the National Pharmaceutical Pricing Authority (NPPA) under the Union Ministry of Chemicals and Fertilizers has taken strict steps. The authority has capped the trade margin (TMR) on 137 widely used non-scheduled anti-cancer drugs at 30 percent. After this strict policy intervention of the government, there will be a huge decline of up to 70 percent in the maximum retail prices (MRP) of these life-saving cancer medicines from November 9.

Till now, in case of non-scheduled medicines, pharmaceutical companies, wholesale distributors (stockists) and private hospitals used to decide the MRP at their own discretion by adding huge trade margin of up to several hundred percent. Many times, the injection or medicine which used to cost ₹ 1,000 at the company level, was sold to patients for ₹ 8,000 to ₹ 10,000 by adding arbitrary commission of middlemen. NPPA has put a freeze on these uncontrolled profits using emergency powers in public interest conferred under Para 19 of the Drugs (Prices Control) Order, 2013 (DPCO 2013). Under the new formula, the MRP of any medicine can be decided only by adding a maximum of 30 percent trade margin on the price sold to the first distributor (Price to Stockist – PTS). Understand this with a simple example: If the Price to Stockist (PTS) of an anti-cancer vial is ₹ 70, then its final MRP after adding a maximum margin of 30% (₹ 30) and applicable Goods and Services Tax (GST) will not be more than ₹ 100 in any case.

A high-level expert committee of the country’s top oncologists, cancer surgeons, medical experts and hospital administrators under the Directorate General of Health Services (DGHS) has prepared the list of these 137 essential medicines. This list covers therapies used to treat more than 20 types of cancer. Major medicines specifically included in this list:

• Immunotherapy and targeted therapy: Modern and highly expensive molecules like Pembrolizumab, Durvalumab, Atezolizumab and Osimertinib.

• Breast and prostate cancer medicines: Denosumab, which is given to protect bones in breast and prostate cancer patients.

• Colon, Ovarian and Cervical Cancer: Anti-cancer medicines such as Bevacizumab.

• Chemotherapy Support Drugs: Pegfilgrastim, which is considered very important in preventing neutropenia, a decrease in white blood cells (WBC) in patients during chemotherapy. Due to the cheapness of these medicines, thousands and lakhs of rupees will be saved in the expenses of every cycle of patients undergoing chemotherapy in Delhi-based AIIMS (AIIMS), Lucknow’s KGMU and Kalyan Singh Super Specialty Cancer Institute, Mumbai’s Tata Memorial Hospital and all the government and private hospitals of the country.

This is not the first time the government has limited trade margins on cancer drugs. Earlier in 2019, NPPA had imposed a 30% trade margin cap on 42 non-scheduled anti-cancer drugs as a pilot project. The result of that historic step was a massive reduction of up to 90 per cent in the prices of 526 leading brands in the market, resulting in an annual saving of approximately ₹1,000 crore for patients. Expanding the same successful model, now 137 modern and high-cost medicines have been brought under this protection cover.

Following the release of the government notification, strict compliance instructions have been put in place for all stakeholders:

1. Submission of Revised Price List: All domestic and multinational drug manufacturers and importers will have to calculate the revised MRP of all their 137 formulations and submit them online to NPPA and State Drug Controllers within 7 days of the issue of the Gazette Notification.

2. Order to be displayed publicly: Companies will have to release the new price list on their websites and send it to all authorized distributors and hospitals.

3. Mandatory responsibilities of hospitals: Since a large portion of cancer medicines are dispensed directly from hospital pharmacies, it will be mandatory for all private and corporate hospitals to display boards of these reduced prices at the billing counters of their premises and on their official websites from November 9.

4. Continuity of supply: No company will be allowed to arbitrarily stop producing or importing medicines. If a company wants to stop production, it will have to give prior notice to the government 6 months in advance so that artificial shortage is not created in the market.

NPPA has strengthened digital platforms to ensure transparency. From November 9, whenever patients or their relatives buy cancer medicines from any medical store or hospital, they can do so through the official mobile app of the Central Government. ‘Pharma Sahi Daam App’ Or you can visit the online portal of NPPA and see the ceiling rate of the salt and brand of the concerned medicine. If any hospital or medical store charges higher price on old printed MRP, complaint can be lodged directly through the same app. The enforcement teams of the State Drug Administration will conduct surprise inspections and file a legal case after seizing the excess amount along with interest from the institutions making excess recovery.