Draft Pharma Policy

Why in news?

The draft pharma policy was recently released by the Department of Pharmaceuticals (DOP).

What are the highlights of draft pharmaceutical policy?

• The new pharmaceutical policy proposes to balance the need for price control over medicines.
• Union government will gain a greater role in deciding prices of medicines and medical devices.
• Pricing authority will regulate only medicines that are specified by the government in the National List of Essential Medicines.
• The price caps being imposed on patented medicines are reduced.
• Policy allows pharmaceutical manufacturers to sell their medicines under only under generic names and not under differently-priced brands.
• Manufacturing of drugs under WHO standards is made mandatory.
• The policy seeks to bring down the unreasonable trade margins offered by various stockists to hospitals.

What are the issues with the policy?

• The policy fails to lay controls over the chemists, this may facilitates the sale of fake drugs.
• The policy doesn’t have any mechanisms to boost production standards.
• Instead of an appellate authority, it seeks to give bureaucrats more powers on drug controls.
• Direct price control – Government takes role of fixing the drug price.
• This will affects the quality, innovation, and hurts patients as much as it does companies.
• It opens the door to lobbying and rent-seeking with all the attendant dangers for competition and for corruption.

What measures can be taken?

• It will be better if price monitoring focuses on essential drugs, there are about 200.
• Strict price control measures needs to be avoided and market friendly pricing should be followed.
• Domestic production of import drugs should be promoted, with better quality and affordability.
• The government should also consider specific steps against overcharging of prices by the industries.

Source: Business Standard