Important for
Prelims: Science & Technology
Mains: General Studies Paper III
Off-Patent Drug Pricing
- The Centre has come out with a formula to fix the price of medicines set to lose their patent exclusivity.
How the Patent Works ?
- A patent for drugs in India gives the patent holder exclusive rights to manufacture, use, sell, or import the patented drug in India for a specified period, typically 20 years from the date of filing the patent application.
- National Pharmaceutical Pricing Authority (NPPA) (under the Ministry of Chemicals and Fertilizer) has been established to fix/revise prices of medicines under the Drugs (Prices Control) Order (DPCO), 2013.
Recent Pricing Formula
- For the off-patent price of a medicine (patented under the Patent Act, 1970): It will be capped at 50% of its original cost. After one-year ceiling price will be revised again based on market data.
- For Generic version: When generic versions become available, the price will be determined based on the average price of similar versions.
- For Fixed Dose Combinations (FDC), where one component is going off patent, the ceiling price will be revised to 50% of the current ceiling price.
- For innovative drugs not available in India: An expert committee will decide the price cap.
Importance
- Streamline Drug Pricing.
- Promote Healthy Competition among Pharmaceutical Manufacturers.
- Affordable Healthcare.
- Reduce Out-of-Pocket Expenditure of Patients.
Practice Questions for Prelims
Mains Practice Question
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