The National Pharmaceutical Pricing Authority (NPPA), which comes under the Union Ministry, has cited extraordinary circumstances and the need to protect the public interest for raising the ceiling prices of eight essential drugs.
The NPPA, under the Union Ministry of Chemicals and Fertilizers, was established in 1997 and sets ceiling prices under the Drug Price Control Order (DPCO), which is governed by the Essential Commodities Act, regulating drug prices to ensure access to essential medications for the public.
The drugs affected by this price hike include critical medications such as Salbutamol (for asthma), Streptomycin (for tuberculosis), Lithium (for bipolar disorder), and Pilocarpine eye drops (for glaucoma). The prices of these drugs have been increased by 50% above their current ceiling prices.
This move comes after the NPPA's routine price adjustments, which are usually made annually based on the Wholesale Price Index (WPI). However, the latest hike is an exceptional measure, allowed under Section 19 of the DPCO, which grants the government the power to revise prices in extraordinary circumstances if deemed necessary for the public interest.
The NPPA’s justification for the hike was linked to rising costs faced by drug manufacturers, such as the increasing prices of active pharmaceutical ingredients, production costs, and fluctuating exchange rates. These factors, according to the NPPA, have made the sustainable production of certain drugs unfeasible. In some cases, manufacturers reportedly considered discontinuing certain formulations due to these financial pressures.
The government’s decision has, however, raised concerns among healthcare professionals and experts. Critics argue that the rationale provided by the NPPA lacks transparency. Questions have been raised about which specific drugs have experienced the highest production cost increases and the exact contributing factors for each medication. These details, according to experts, are crucial for public trust, especially when the price hikes affect widely used drugs for chronic conditions.
The increased drug prices come at a time when the government is already under scrutiny for the rising healthcare expenses in the country. According to the latest National Health Accounts report, pharmaceutical expenses constitute nearly one-third (30.84%) of the total healthcare expenditure in India. This includes both prescribed and over-the-counter medications, and people are spending substantial amounts on medicines, often for long-term treatments of common diseases.
The hike also raises concerns about the availability and affordability of alternative treatments, especially for low-income patients. For instance, Salbutamol, used by asthma patients, has seen its tablet formulation included in the list of scheduled drugs.
However, experts point out that the tablet version of the drug is slower in action and comes with significant side effects. Inhalers, which are more effective and safer, remain out of stock in many government hospitals and are costly in private pharmacies, thus placing them beyond the reach of many poor patients.