Understanding the Drug Price Control Order, 2013
The Drug Price Control Act, 2013 was announced by the Department of Pharmaceuticals, Ministry of Chemicals and Fertilizers. The purpose of this act was to improve the availability of fundamental medicines at reasonable prices throughout India.
This order, issued by the Government of India under Section 3 of Essential Commodities Act, 1955, regulates drug pricing in the country. The implementation of DPCO 2013 is the responsibility of the National Pharmaceutical Pricing Authority (NPPA).
Introduced in May 2013, the DPCO 2013 impacted the pricing of over 300 essential medicines, which was based on their manufacturing cost. According to the DPCO 2013, the prices of all dosages listed in the National List of Essential Medicines (NLEM) would be controlled.
Why was the Drug Price Control Order implemented?
The Drug Price Control Order came into effect due to several reasons:
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Certain pharmaceutical companies were increasing the prices of their products to maximize their profits, which adversely affected the everyday user.
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The soaring prices of these medicines made them unaffordable for the common man.
To counteract these issues, the Government of India introduced the Drug Price Control Order. This order sets the prices of essential drugs and controls them to ensure their accessibility to the public.
What does 'Essential Medicine' mean?
Essential medicines are those that satisfy the healthcare needs of the majority of the population. This concept was first introduced by the World Health Organization (WHO) in 1977. A medicine is considered 'essential' based on the following factors:
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Its relevance to public health
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The evidence of its efficacy and safety
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Its comparative cost-effectiveness
Characteristics of Essential Medicines:
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Essential medicines should be available at all times, in sufficient amounts.
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They should always be available in the appropriate dosage forms.
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These medicines should always come with assured quality and adequate information.
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The prices of these medicines should be affordable for individuals and communities.
The Drug Price Control Order (DPCO) emphasizes the need for measures to rationalize the use of essential medicines. Some measures that the government can undertake are:
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Imposing Clinical Guidelines on pharmaceuticals (DPCO is an example of this).
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Promoting drugs committees at district and hospital levels.
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Ensuring proper supervision, audit, and feedback.
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Enhancing public education about medicines.
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Sufficient government spending to ensure the availability of medicines and staff.
Delving into the Drugs (Prices Control) Amendment Order, 2019 for UPSC
The key facts about the DPCO (Amendment) 2019 are detailed in the table below:
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An Overview of Drug Price Control Order (DPCO) Amendments 2019 – Useful Facts for IAS Exam
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Who introduced it?
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Ministry of Chemicals and Fertilizers
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What are the main points about the DPCO amendments?
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A drug manufacturer who introduces an innovative patented drug is offered an exemption from price control regulations for 5 years (from the date of marketing).
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The Department of Pharmaceuticals (DoP) was recommended the amendments by the
NITI Ayog
.
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Drugs for treating rare or “orphan” diseases will also be exempt from price control, with a view to encouraging their production.
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The Central government will continue to fix prices based on market data available on drugs.
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The source of market-based data will be the data available with the pharmaceutical market data specializing company, as decided by the government.
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If necessary, the government may validate such data by conducting an appropriate survey or evaluation.
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