Cancer Medicine Price Cut: A major change has been made in the prices of medicines to reduce the expenditure on cancer treatment in the country. Following the decision of the National Pharmaceutical Pricing Authority (NPPA), prices of 397 out of 543 cancer drug brands and packs have been reduced. The prices of many of these medicines have reduced by more than half. However, there is no change in the prices of some expensive patent medicines. The new prices will be applicable from November 9.
Prices of 397 medicines reduced, prices of many reduced by more than 90%
According to available information, after the change in prices, prices of about 73 percent of 543 brand-packs have reduced. Of these, the prices of 217 medicines have been reduced to less than half. At the same time, the prices of 97 brands have been reduced by more than 70 percent and the prices of 50 have been reduced by more than 80 percent. The prices of five medicines have been reduced by more than 90 percent.
This change is expected to provide relief to patients and their families who spend money on cancer treatment. However, the actual savings will depend on the drug the patient is using and the quantity he requires.
Injection of ₹80,071 now costs ₹7,150
The biggest reduction in prices includes the name of Samtepa injection. Its price has been reduced from ₹80,071 to ₹7,150. Similarly, the price of a pack of 21 capsules of Palbopro has reduced from ₹40,421 to ₹2,720. These examples show that the prices of some cancer drugs have been reduced significantly.
However, patients should confirm the new maximum retail price (MRP) and the information mentioned on the pack while purchasing the medicine. The medicine or its dosage should not be changed without doctor’s advice.
Discussion on drug prices intensifies after Supreme Court’s strictness
The issue of high prices of cancer medicines and huge profits added on medicines by hospitals has also been raised in the Supreme Court. The court had questioned the huge difference between the maximum retail price of medicines and the price received by the retailer. During the hearing, the court asked the government why drug prices were not being effectively controlled and why comprehensive steps could not be taken to provide relief to the patients.
The court also questioned the government’s move to limit the trade margin on anti-cancer drugs to 30 per cent of the MRP. The court wanted to know why setting trade margin limits for other drugs also could not be considered.
Trade margin limit on 137 anti-cancer drugs
The government has limited the trade margin of 137 anti-cancer drugs to 30 percent of the maximum retail price. According to the Centre, this move is expected to save patients about Rs 2,500 crore annually. The objective of this system is to reduce the difference between price and profit in the supply chain of medicines. However, the extent to which the benefits of price cuts reach patients will also depend on the actual selling prices of the medicines and the distribution system.
Prices of many expensive medicines still remain intact
The prices of many cancer medicines have come down, but there has been no change in the prices of some expensive medicines. These include the immunotherapy drug Keytruda, which is used in the treatment of more than 21 types of cancer. Its quoted price is still ₹2,16,500. Apart from this, the price of Ribociclib, used in the treatment of breast cancer, remains at ₹ 24,435. It has been reported that there is no change in the prices of medicines like Tagrisso, Tecentriq, Darzalex and Imfinzi.
Many of these medicines are covered under patent and have been developed using new technology. Their pricing is influenced by patent rights, production costs and market conditions. However, mere existence of patent cannot be considered as the sole reason for the lack of change in prices.
What is the role of DPCO in determining the price of medicines?
The government regulates the prices of essential medicines under the Drug Price Control Order (DPCO), 2013. This system plays an important role in determining the maximum price of medicines included in the National Essential Medicines List (NLEM).
The process of determining the price of medicines mainly involves:
- Fixing ceiling prices: The prices of essential medicines are capped under prescribed rules.
- Assessment of market prices: The prevailing market prices of the concerned medicines are taken into consideration.
- Essential Medicines List: The list is prepared keeping in mind the health needs, usefulness and safety of the medicines.
- Periodic review: New medicines are added to the list as per need and prices are reviewed.
Medicines which are not included in the essential medicines list may have different price control arrangements. However, such drugs are also subject to government monitoring and intervention as per the applicable regulations.
Questions raised regarding trade margin
After the huge reduction in the prices of medicines, the discussion on the trade margin system has also intensified. Critics say drugs can be more expensive for patients because of margins made by stockists, distributors and other middlemen in the supply chain.
Questions have also been raised regarding allowing margin of up to 42.8 percent on price to stockist under Trade Margin Rationalization (TMR). In expensive medicines, the actual amount of margin determined in terms of percentage can be quite large.
In some cases, drugs are also sold directly to hospitals, which can vary the structure of the supply chain and distribution of profits. In such a situation, the data of the entire distribution system is also important for estimating the prices instead of just the percentage.
Discussion regarding patient assistance programs also
Some companies provide medicines free or at discounted rates to needy patients under patient assistance programs. Questions have also been raised over the exclusion of medicines supplied under these programs from the calculation of trade margin.
Critics argue that including these drugs in the calculations would lead to a better assessment of the prices and supply chain margins of some patent drugs. Similarly, the difference between the margin limits applicable to other drugs under the DPCO and the regime adopted for cancer drugs is also being discussed.
Questions on monitoring and transparency of NPPA
It is important to have accurate data on actual prices and margins at each level in the drug supply chain. In this case, questions have been raised regarding the data available with NPPA, the information provided by the companies and the system of independent verification.
Experts and critics believe that if information on prices and margins were more transparent, it would be easier to ascertain at what level how much profit is being added to the final price of the drug.
Even on September 29, the Supreme Court had expressed its displeasure
Earlier, in the hearing held on September 29, the Supreme Court had expressed concern over the high prices of cancer medicines. According to the report, the court had questioned the MRP of ₹27,000 on a medicine worth ₹2,700 and drew attention to the financial burden on the patients.
The court also raised the question that when the government is facing problems related to drug prices and profits, why effective steps are not being taken to address them. After hearing in both the cases, the court had reserved its decision.
How much relief will the patients get?
Reduction in prices of 397 cancer medicines is likely to provide relief to many patients. Especially in the case of those medicines, whose prices have reduced by more than 70 to 90 percent. But prices of some expensive patent medicines still remain high.
Therefore, along with changes in drug prices, monitoring of trade margins, supply chain transparency and actual savings reaching patients will also be important. After the implementation of the new prices, it will be important to see how much the total treatment cost of patients reduces.