Med costs rose by 40% in 10 yrs

Panel Blames Price Decontrol Policy, Suggests Fixing Rates For FormulationsNewDelhi:Drug prices have shot up phenomenally in India over the past decade and a half. A Planning Commission's expert group says there was nearly 40% rise in drug prices between 1996 and 2006, thanks to the price decontrol policies of the 1990s. 

    Citing a study in 2008, the panel's high-level expert group on universal health coverage, headed by Dr K Srinath Reddy, says that during the same period, the price of controlled drugs rose by 0.02%, while those in the Essential Drug List (EDL) increased by 15%. The price of drugs that were neither under price control, nor under the EDL grew by 137%. 
    The panel cites that the pharmaceutical industry spent over 25% of their annual turnover on sales promotion alone as compared to a paltry 7% on research and development in 2008-09. The report says, "Taking advantage of lax regulations on drug pricing, the pharmaceutical industry has been able to reap high margins through complex price setting activities." 
    It has been observed that the price of a therapeutically similar drug could vary around 1,000% between the most expensive and the cheapest brands. The variation between the market and procurement price of similar drugs could range anywhere between 100% and 5,000%. The panel recommended price control on all formulations in the EDL. 
    The report says, "Direct price control should be applied to formulations rather than on basic drugs. This is likely to minimize intraindustry distortion in transaction and reduce as well as prevent a substantial rise in drug prices." 
    It brings to light the widespread use of irrational drugs. India has the dubious distinction of its pharmaceutical market being flooded with about 90,000 formulation packs and brands. "The market is awash with irrational, non-essential and hazardous drugs. Of the top 10 products which accounted for 10% of the medicines sold in the market, two belong to the category of irrational vitamin combinations and cough syrup while the other is a liver drug of unproven efficacy. Ten of the top 25 products sold in India in 1999 belonged to one of these categories: blood tonic, cough expectorant, nondrug formulations, analgesics, nutrients and liver drug which are hazardous, non-essential or irrational." 
    Drug Controller General of India estimated that about 46 banned fixed dose combination drugs are marketed irrespective of the ban. About 1,067 FDCs are freely marketed with the state drug controllers' approval, but sans DCGI's concurrence. 
'Bring pharma dept under health min' A Planning Commission group has recommendedthat the department of pharmaceuticals be transferred to the Union ministry of health. Now, the department, responsible for price control, is part of the ministry of chemicals and fertilizers.BITTER PILL 
    Citing a 2008 study, a plan panel expert group said that between 1996 & 2006, the price of controlled drugs rose by 0.02%, essential drugs by 15% and those not in either category by 137% 
    The price of a therapeutically similar drug could vary around 1,000% between the most expensive & the cheapest brands 
    The variation between the market and procurement prices of similar drugs could be anywhere between 
100% and 5,000%