The Centre is considering extending its trade margin control on medicines beyond cancer drugs, with anti-infectives emerging as the next category under review. A preliminary analysis by the National Pharmaceutical Pricing Authority (NPPA) has found trade margins exceeding 100 per cent in these medicines, prompting discussions on whether they should also be capped.
Anti-infectives include antibiotics, antivirals, antifungals and antimalarials, which are used to treat various infections. They are among the most commonly prescribed medicines in hospitals and pharmacies across the country.
"Our next focus is on non-oncology drugs, especially the anti-infective category. Our preliminary analysis shows this category also has high TMR, over 100 per cent and may need capping," a senior government official familiar with the development told News18.
The publication reported that two government officials from the Ministry of Chemicals and Fertilisers and the Ministry of Health and Family Welfare confirmed the development.
No Further Cancer Drugs Under Trade Margin Cap
The Centre does not plan to extend trade margin rationalisation (TMR) to more cancer medicines, the official said, adding that the government had already covered the identified drugs under the exercise.
"We have exceeded the number of oncology drugs that could come under the trade margin caps. In fact, 137 drugs are not yet in the market, and about 10 to 15 drugs of that size have not been launched yet in India. So, there are no more cancer drugs that need trade margin rationalisation," the official said.
The NPPA had on October 17 capped trade margins at 30 per cent for 137 non-scheduled anti-cancer formulations under Paragraph 19 of the Drugs Prices Control Order (DPCO), 2013. The revised prices are scheduled to take effect from November 9, with the move expected to reduce maximum retail prices (MRPs) by up to 93 per cent in some cases.
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What Is Trade Margin Rationalisation?
A trade margin is the difference between the price charged by a drug manufacturer to a stockist or distributor and the maximum retail price paid by the consumer. Under a 30 per cent trade margin cap, a medicine with a distributor price of Rs 70 can have a maximum revised MRP of Rs 100, excluding GST.
The latest intervention expands on a 2019 pilot programme, under which trade margins on 42 anti-cancer medicines were capped at 30 per cent. The exercise had reduced the MRPs of 526 brands of non-scheduled cancer medicines by up to 90 per cent.