While extending the National List of Essential Medicines will help patients, care has to be taken to ensure this does not lead to a slowdown of production as has happened in case of DPCO drugs.
Daara B Patel, Secretary-General, Indian Drugs Manufacturers Association
The proposal to increase the list of essential drugs under the National List of Essential Medicines (NLEM) is a retrograde step. The industry is already burdened with price controls in one way or the other, and this is probably the only industry where both input costs as well as profit margins are controlled.
The NLEM-2003 selection criteria states that "Essential medicines are selected with due regard to disease prevalence, evidence on efficacy and safety, and comparative cost-effectiveness", and to ensure that "essential medicines are available within the context of functioning health systems at all times in adequate amounts, in the appropriate dosage forms, with assured quality".
Though the Drug Price Control Order (DPCO) was set up to ensure availability and accessibility of medicines, it has ended up driving out of the market globally-recognised drugs that were, in any case, affordable -- it did this by driving prices down to such levels where firms were unable to supply.
This, in turn, hurts patients. There is a lack of transparency in how prices are fixed under the DPCO and the government takes suo motu decisions without taking into account inflation, labour costs, raw-material costs and increase in cost of utilities such as electricity, water, furnace oil, petrol, diesel etc.
There is no price control on any item or service of daily necessity -- food, shelter, clothing, transport, communication, education, or on doctors' fees and hospital charges. So, why should there be price controls only on medicines?
Also, excessive control will be counterproductive, with cost of treatment to the consumer rising. The lack of adequate margin in price- controlled products will result in the de-controlled products being promoted. Investments will not take place and manufacturers will be unable to attract and retain talent or promote employment which the country needs badly.
Now the government attempts to add to this burden by bringing in more medicines under control, effectively increasing the direct span of control to about 35 per cent.
The fact is that almost all medicines barring few are effectively controlled. There is already a 10 per cent ceiling on price increases annually in the non-scheduled drugs category. Thus the industry is almost effectively under price control.
Such controls and restrictions by the government will be detrimental to the growth of the indigenous pharma industry and may lead to a situation similar to the one that existed in the 70s, when the country depended heavily on imports at exhorbitant prices. If the DPCO is continued as it stands today, it would not serve the purpose it is meant for (bringing down the prices and encouraging growth of the industry).
The Economic Survey 2008-09 has rightly recommended that drug prices be decontrolled and only prices of essential drugs with less than five producers be controlled, as the industry has matured and almost every medicine has a number of manufacturers.
We suggest that till such time of total decontrol as envisaged by the Economic Survey, the government give up cost-based price control completely and consider monitoring prices for non-patented drugs; patented drugs are monopoly products and hence need some ceiling/control on prices.
Whichever way one looks at it, it is very difficult to have a realistic definition of an essential drug. What may be essential for one patient may not be considered essential by another. Hence, expanding the list of essential medicines would seriously harm not only the national pharmaceutical industry but also the needy patients of our country.
The proposal to include all the 354 drugs in NLEM under the scope of price control was even opposed by the Prime Minister's Office in 2006, as also by several ministries and departments. We, therefore, see no reason why the list of essential drugs should be extended and brought under price control instead of just monitoring their prices.
Reducing and simplifying price controls and thus increasing competition is the only way to make essential drugs available at affordable prices.
Leena Menghaney, India co-ordinator, Campaign for Access to Essential Medicines (MSF)
The Essential Drugs List (EDL) is an important public health policy tool. It guides the government, particularly the health ministry, in the selection of medicines and vaccines needed to address health problems and healthcare needs of its citizens.
The EDL is directly related to the decisions the government makes about procurement, pricing measures and implementation of policies for the rational selection and use of medicines by the medical community -- public and private.
Medicines and vaccines listed in the EDL should be domestically available at all times in adequate amounts, in appropriate dosage forms, and at prices affordable for both patients and the government.
The World Health Organisation publishes a model EDL -- containing a core and a complementary list -- and regularly updates it, which guides countries in formulating their national lists, taking into consideration local priorities.
For years, India had been paying scant attention to the EDL, and so, a court case related to pricing of essential medicines led to a revision of India's National List of Essential Medicines by policy-makers in 2003.
As a follow-up, there is an urgent need to link the NLEM to measures that will make essential medicines and vaccines available to patients in India.
One crucial measure is to ensure that these essential medicines and vaccines are available through the public healthcare system. This can mean substantial savings for the public healthcare budget, which benefits from improving the selection of medicines and vaccines through the use of the EDL and purchasing those medicines and vaccines competitively.
In India, however, purchase of medicines by different states is not necessarily based on the EDL with a few exceptions, such as Tamil Nadu.
Another important measure is to link the NLEM to India's pricing policy, which controls and regulates the prices of essential medicines in the private health-care sector.
It is in this context that the Drugs Price Control Order 1995, an order issued by the government under Section 3 of the Essential Commodities Act, 1955 to regulate the prices of essential medicines, should be reviewed and implemented.
Access to these essential medicines and vaccines in India will also depend on important legal measures that support domestic production and supply but at the same time strictly regulate pharmaceutical companies against unethical promotion of high- priced, branded medicines; ensure rational prescriptions by healthcare workers in the private sector; and control profit margins of distributors and retailers.
In addition to this, India's EDL should be regularly reviewed to ensure that newer medicines and vaccines, whose use can be justified at the time of their inclusion in the list, are not excluded from the NLEM, solely because of their price.
This is important as with the implementation of the product patent regime, newer life-saving treatments for HIV, hepatitis C, cancer and other diseases have been patented and are likely to be expensive.
This is essential for the proper implementation of Indian patent law safeguards that facilitate the local production of low-cost generic versions of patented medicines and vaccines through government-use licences.
Affordable pricing of essential medicines cannot be achieved only by relying on voluntary actions by pharmaceutical companies. Therefore, any revision and expansion of the Indian EDL should go hand in hand with other policy measures to ensure that these medicines and vaccines become affordable for patients and the public healthcare system.
This can also be seen as a unique opportunity for the government to use the EDL as an integral part of its strategy to address complex public health concerns -- from availability, affordable pricing and rational use of medicines to efficient management of the public healthcare system.
