Govt caps trade margin on oxygen concentrators at 70%

The government has capped the trade margin on oxygen concentrators at 70 per cent in order to keep in check the price of the much in demand critical life saving component amid the second wave of the coronavirus pandemic.

The trade margin has been capped at 70 per cent on price to distributor level on oxygen concentrators.

In an official release, the chemicals and fertilisers ministry said the decision has been taken in view of the extraordinary circumstances arising due to the pandemic which has resulted in volatility in Maximum Retail Prices (MRP) of oxygen concentrators.

The government has thus decided to step in to regulate the price of oxygen concentrators, the release issued on Friday noted.

As per information collected by the government, margin on the oxygen concentrators at the distributor level currently ranges up to 198 per cent, it added.

"By invoking extraordinary powers under Para 19 of the DPCO, 2013 in larger public interest, NPPA has capped the trade margin up to 70 per cent on price to distributor (PTD) level on oxygen concentrators," the release said.

Union Minister of Chemicals and Fertilisers Sadananda Gowda in a tweet said the trade margin has been capped in consumer interest to ensure its continued availability at affordable price during the pandemic.

"The price regulation will safeguard profitability and prohibit profiteering at the cost of consumer during the pandemic," he added.

The order shall be applicable up to November 30, 2021, subject to review, the release said.

Revised MRPs will be informed in public domain within a week by NPPA, it added.

Based on the notified trade margin, NPPA has instructed the manufacturers / importers to report revised MRP within three days.

Every retailer, dealer, hospital and institution shall display a price list as furnished by the manufacturer, on a conspicuous part of the business premises in a manner so as to be easily accessible to any person wishing to consult the same, the release said.

"The manufacturers / importers not complying with the revised MRP after trade margin capping, shall be liable to deposit the overcharged amount along with interest at the rate of 15 per cent and penalty up to 100 per cent under the provisions of the Drugs (Prices Control) Order, 2013 read with Essential Commodities Act, 1955," it added.

State Drug Controllers (SDCs) shall monitor the compliance of the order to ensure that no manufacturer, distributor, retailer shall sell oxygen concentrators to any consumer at a price exceeding the revised MRP, to prevent instances of black-marketing, the official release noted.

With the spike in cases in the second wave of COVID-19 in the country, demand for medical oxygen has shot up considerably.

The government said it is striving to ensure uninterrupted supply of oxygen and oxygen concentrators in adequate quantity in the country during the pandemic.

Oxygen concentrator is a Non-Scheduled Drug and presently under voluntary licensing framework of Central Drugs Standard Control Organisation (CDSCO).

Its price is being monitored under the provisions of DPCO 2013.

In February this year, the National Pharmaceutical Pricing Authority  (NPPA) had successfully capped the trade margin on anti-cancer drugs.

Photograph: ANI Photo