‘New Stent Prices Leave Enough Mar­gins for In­dus­try to Grow’

The Economic Times - - Companies: Pursuit Of Profit -

The Na­tional Phar­ma­ceu­ti­cal Pric­ing Author­ity (NPPA) re­cently slashed the prices of coro­nary stents by over 75%. NPPA chair­man Bhupendra Singh ex­plains the ra­tio­nale be­hind the move and speaks to ET Pharma on its tough stance to en­sure com­pli­ance. Edited ex­cerpts:

How did NPPA cal­cu­late the ceil­ing prices for these stents? What im­pact do you ex­pect? A de­tailed record of pro­ceed­ings of NPPA meet­ing shall be up­loaded on Mon­day. NPPA con­sid­ered all avail­able op­tions of price fix­a­tion of stents, in­clud­ing the landed cost, cost of pro­duc­tion, the price to dis­trib­u­tors, etc. We have tried to stop prof­i­teer­ing through our lat­est no­ti­fi­ca­tion and leave only rea­son­able prof­its to all stake­hold­ers in the trade chan­nel. Para 19 pro­vides for flex­i­bil­ity to not con­fine only to PTR (price to re­tailer) method.NPPA has not con­sid­ered price to hospi­tals as PTR for pric­ing pur­pose—or hospi­tals as re­tail­ers. Price cap­ping will make stents more af­ford­able and ac­ces­si­ble to pa­tients and new prices leave enough mar­gins for the in­dus­try to grow, in­no­vate and come out with new prod­ucts as well.

How will NPPA en­sure com­pli­ance to the ceil­ing prices? The Drug (Prices Con­trol) Order, 2013, and E.C. (Es­sen­tial Com­modi­ties) Act have ad­e­quate pro­vi­sions to en­sure com­pli­ance. NPPA works closely with the State Drug Con­trollers (SDCs), who have been sen­si­tised to the com­pli­ance is­sues sur­round­ing stents. I have al­ready writ­ten let­ters to Chief Sec­re­taries of all the States. Our 24x7 helpline is work­ing and com­plaints can be sent on “Pharma Jan Sa­mad­han” and “Pharma Sahi Daam”. De­part­ment of Phar­ma­ceu­ti­cals have also been re­quested to in­voke pow­ers un­der Para 3, of DPCO. Stents are now es­sen­tial com­mod­ity. Any vi­o­la­tion to de­feat the ob­jec­tive of mak­ing car­diac stents af­ford­able to peo­ple will be dealt with a firm hand.

How will NPPA deal with an ar­ti­fi­cial short­age of these stents? Some com­pa­nies have re­port­edly with­drawn batches for re­la­bel­ing… DPCO pro­hibits with­drawal of any prod­uct with­out ap­proval from NPPA and fol­low­ing due process, which in­cludes six months prior no­tice to pub­lic. NPPA is mon­i­tor­ing these re­ports and acts swiftly with the help of State Drug Con­trollers. Re­gard­ing with­drawals for chang­ing MRPs, it has been clar­i­fied that re­la­bel­ing is not manda­tory by man­u­fac­tur­ers. If a re­vised price list is is­sued im­me­di­ately and sent to NPPA, SDCs, all dis­trib­u­tors and re­tail­ers and the pa­tient is not charged over the new MRP by hos­pi­tal, com­pli­ance will be ac­cepted.

BHUPENDRA SINGH Chair­man, NPPA

Global stent com­pa­nies ar­gue your move would pre­vent ac­cess to fur­ther in­no­va­tion in stents. Your re­sponse? New ceil­ing prices have enough mar­gins for present prof­its and fu­ture growth. The NLEM com­mit­tee of (health min­istry) found that clin­i­cal 'su­pe­ri­or­ity' of biore­sorbable vas­cu­lar scaf­folds is not es­tab­lished and all drug elut­ing stent vari­ants are med­i­cally & clin­i­cally same. The De­part­ment of Phar­ma­ceu­ti­cals also ac­cepted the NLEM com­mit­tee's rec­om­men­da­tions and no­ti­fied all DES, in­clud­ing BVS, as one cat­e­gory. NPPA is not com­pe­tent and au­tho­rized to change that. How­ever, as far as in­no­va­tion is con­cerned, there is a pro­vi­sion of Para 11(3)(4) un­der the Drug Prices Con­trol Order for sep­a­rate and pref­er­en­tial pric­ing if its 'ther­a­peu­tic su­pe­ri­or­ity' is clin­i­cally proven. We are open to such re­quests and ap­pli­ca­tions.

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