Cheap generics vital to tackle diseases

The government took a bold decision recently whereby doctors have to write the generic names of drugs and the Medical Council of India (MCI) issued a circular to all medical college principals, hospital directors, State medical councils and health secretaries avowing any doctor violating these provisions could face “suitable disciplinary action.”

Importantly, Prime Minister Modi made plain legal arrangements would be made to make prescription of generic medicines compulsory, given that though mandatory doctors are not following it, notwithstanding the MCI ethics code which made this compulsory for doctors October last. Shockingly, pharmaceutical companies are bribing doctors to prescribe their high cost drugs as the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) to prevent such unethical practices has been hanging fire for two years.

Also, there is a need to reduce generic drugs prices as an Indian Journal of Pharmacology study found that though generic variants were less expensive than branded ones, the retail margin on these is much higher sometimes more than 1000 per cent of the manufacturer’s price!
While this move would help the poor and economically weaker sections get relatively low-cost generic drugs, the government plans to overhaul the drug policy and ease regulatory framework impacting access to affordable medicines.

Already, the existing price control system has been watered down, obviously due to pressure from the industry. Bluntly, essential drugs have to be made available to the poorer sections at affordable prices. Public health experts aver that diluting price controls on essential medicines would mean ignoring high out-of-pocket spending on medicines that would impact the common man. Wherein, delinking essential medicines from price regulation would result in prices surging of commonly used drugs. In rural India, around 70 per cent of out-of-pocket expenses are on medicines while it is 60 per cent in urban areas.

Obviously, the move towards dismantling price controls on essential medicines and winding up the National Pharmaceutical Pricing Authority (NPPA) are being done at the behest of industry lobbies under the pretext of removing regulatory controls or the ‘ease of doing business’ in India. Currently prices of over 400 essential medicines are capped by the government whereas on all other medicines, companies are allowed to hike prices by only 10 per cent annually. But, even with this control most pharmaceutical firms including multi-nationals make huge profits.

Every year the profitability of pharma companies goes up as the sector is considered quite lucrative. Moreover in a country with a huge population and living standards unsatisfactory, there is a great demand for medicines which is expected to increase in the coming years. Although a section feels that stringent regulation is hampering growth of the country’s drug manufacturing industry, which incidentally is one of the largest export revenue churners for the Government, this is not the case.

Except for control on few drugs, which may not exceed 20 per cent, the pharma sector has no rigid regulation resulting in this industry being currently pegged at over Rs 1 lakh crore. Meanwhile the government recently announced slashing of prices of 43 essential drugs by up to 35 per cent, a move expected to benefit patients suffering from several critical diseases. The NPPA reduced prices in drugs that are used in treatment of diabetes, cancer, asthma, cardio-vascular diseases, mental disorders and kidney failure.

However, medicine brands with an MRP lower than the ceiling cannot upwardly revise their prices. In fact, since March the NPPA fixed prices of 540 essential medicines resulting in a saving of around Rs 3400 crore, according to Government sources. Given that demand for medicines is increasing at a fast pace and to ensure profitability would not be affected, price control needs to be regulated. This is all the more necessary to ensure that the weaker sections are able to buy drugs needed for their treatment.

By Dr Oishee Mukherjee