“In principle, approval of the Hon’ble Minister (Chemicals & Fertilisers) is granted for utilising para 19 of DPCO, 2013 concerning the aforementioned formulations,” stated a letter from the Department of Pharmaceuticals to the Member Secretary, National Pharmaceuticals Pricing Authority (NPPA) on June 7, as revealed by News18.
In essence, Para 19 provides an extraordinary power that the government can invoke when it deems intervention necessary to ensure the affordability or availability of medications. It allows for actions that go beyond typical price-control measures.
NPPA serves as the country’s pricing regulator, operating under the Department of Pharmaceuticals, Ministry of Chemicals and Fertilisers.
What the government documents actually say
The approval followed an assessment by a government committee of 82 formulations requesting elevated prices. Only four drugs were deemed urgent enough. Cisplatin and carboplatin, both chemotherapy drugs, were included in this list.
Another letter from NPPA to the economic adviser of the Department of Pharmaceuticals, dated June 4 and reviewed by News18, notes that multiple requests for price increases have been received.
“…the NPPA has received applications from various pharmaceutical companies for an upward revision of prices for certain scheduled formulations. The applicants cited reasons such as significant rises in Active Pharmaceutical Ingredient (API) costs, increased production expenses, foreign exchange rate fluctuations, and other related concerns that negatively impact the economic viability of manufacturing and marketing these formulations sustainably.”
It further elaborates that “applications for 82 formulations were reviewed by the Inter-Ministerial Committee (IMC). After thorough examination, the IMC recommended price revisions for four formulations: one of carboplatin injection, one of cisplatin injection, and two anti-tetanus immunoglobulin injections, given the substantial rise in API costs and concerns over their continued availability.”
The committee’s justification is noteworthy. It acknowledged: “The Committee also recognized concerns raised by Tata Memorial Cancer Hospital regarding shortages of Carboplatin and Cisplatin injections, commonly used as first-line chemotherapy agents for various cancers.”
It continued, “Ensuring a continuous supply of these essential medicines is vital from a public health standpoint. For the remaining 78 formulations, the IMC has requested additional information for further assessment.”
In follow-up, NPPA requested DoP’s approval for the proposed price hikes. The letter indicated, “In light of the emerging shortages of carboplatin and cisplatin injections and the reported viability concerns for these four formulations, the matter warrants consideration by the authority…’ The issue was discussed in a review meeting by the Secretary, DoP, regarding pending applications for price increases, and NPPA was instructed to process the requests in line with established frameworks… Additionally, DoP advised NPPA to flag any specific circumstances that would require invoking Para 19 to the department.”
Thus, on June 7, DoP notified NPPA that “in principle” approval from the minister has been granted to exercise powers under Para 19.
The ministry instructed the pricing authority to determine the extent of allowable price increases. The recommended formula: “The Standing Committee suggested a 10 percent yearly increase from the last fixation, with a ceiling of 50 percent, which could serve as a guideline, although the primary principle should be based on cost increases.”
The Department of Pharmaceuticals additionally directed the pricing authority, stating, “NPPA is encouraged to consider increases in raw material costs related to these drugs while aligning the price increase and its implications to determine if a price elevation is permissible. NPPA is also encouraged to investigate other requests where the industry has sought a price increase due to raw material cost hikes similarly.”
Why does this matter?
This governmental approval directly ties into the shortage crisis reported by News18 last week.
Numerous leading oncologists across India mentioned to News18 the shortage of first-line chemotherapy drugs causing treatment delays, dose reductions, disrupted chemotherapy schedules, and routine inventory pressures.
Oncologists expressed to News18 that these shortages lead to the necessity for alternatives to platinum-based agents, which often present lower efficacy and significantly higher costs for patients and healthcare providers alike.
However, this shortage is not solely a supply issue; it is also an economic challenge. Companies opted to discontinue producing unprofitable drugs.
Now, with governmental approval for increased pricing, manufacturers have the ability to enhance production levels once again.
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