Essential drugs’ price hike: The impact

The prices of essential drugs such as antibiotics, painkillers and anti-infectives were slated to spike in the month of April, the National Pharmaceutical Pricing Authority (NPPA) has approved a price increase of 10.7 per cent for critical pharmaceuticals that are subject to price controls. As a result of this decision, the prices of over 800 medications on the National List of Essential Medicines (NLEM) have increased during this month. The NPPA fixes the ceiling rates of scheduled medicines, which are procured by the government for different health programmes, and offers free of cost at government hospitals, as per provisions of the DPCO.

The hike in drug prices works out at around 10.76 per cent based on the Wholesale Price Index (WPI) data, and this is the maximum price increase that can be made. Drugs such as anti-inflammatory drugs, antibiotics, ear-nose and throat medicines, painkillers, antiseptics, gastro-intestinal medicines and anti-fungal medicines, among others, will see a sharp hike in prices. These medicines are regulated by the NPPA, which oversees the cost of 900 products such as pharmaceuticals, medical equipment and glucose. It’s worth mentioning that, in addition to the price hike, GST will be applied.

Being the end users, the consumers will feel the pinch of this price hike. Non-scheduled drugs are allowed an annual hike of 10 per cent. This is the first time that the scheduled drug price increase has exceeded that of non-scheduled ones. In 2021, the hike was only 0.53 per cent, while, in 2020, the hike was 1.88 per cent. NPPA will provide the ceiling prices of the scheduled formulations in coming days.

The supply chain issues and the current geo-political events have led to an increase in the cost of procurement of raw materials and APIs. Prices of solvents like propylene glycol and glycerin, input plastic, metal and paper have surged, affecting patients suffering from heart ailments, diabetes and chronic conditions. The prices of drugs like Paracetamol, Metformin, Diltiazem, Clopidogrel, Carbamazepine and Levothyroxine, which are used in the treatment of various ailments and diseases, will shoot up.

Role of China-India trade relations affecting the price hike

As a result of the epidemic, the Indian pharma industry is grappling with growing input costs from China, as well as freight, packaging material and transportation costs. China’s supply cuts, which account for about 70 per cent of the Indian pharma industry’s bulk drug raw material imports, have put significant cost pressures on the business. The DPCO sets price limitations for important and life-saving pharmaceuticals to ensure that they are affordable. The order includes, among other things, a list of price-controlled pharmaceuticals, processes for fixing drug prices, the manner of implementing government-set pricing, and penalties for violating the requirements. Under the National List, the NPPA has roughly 800 scheduled medication formulations dispersed over 27 therapeutic areas. These include antibiotics, paracetamols, insulin injections, vitamins and supplements to medicines for heart and blood pressure, and skin ailments.

Cardiac and cancer patients are likely to be affected the most

The number of people living with cancer is expected to rise in the next decades, implying that cancer treatments would become increasingly unaffordable if the current price trend continues. Given the growing body of evidence indicating that cancer medications are unaffordable, pharma companies are also trying to tackle the issue of the unaffordability of essential medicines by researching new, more efficient and more affordable alternative treatments for illnesses like cancer. There are promising developments in the field, but it might be a while before patients can reap the benefits of these treatments. However, the continuous effort to find new molecules will help as a saviour, and will help in reducing the cost of the medicines.

Trastuzumab, a targetted cancer medicine used to treat breast cancer and other intestinal cancers, has seen its price hike fastly. Trastuzumab 440 mg/50 ml injection medication, which was formerly priced at Rs 60,296.66, is now priced at Rs 66,790.46. Similarly, the cost of two types of stents used to treat heart disease has increased. A drug-eluting stent that was formerly priced at Rs 30,811, is now priced at Rs 34,128.13; while the bare-metal stent, which was formerly priced at Rs 8,462, is now priced at Rs 9,373.03.