Pharma GoM agrees to limted price control on NLEM

The group of ministers (GoM) deliberating on the contentious pharma pricing policy seems to have reached some consensus, ahead of the Supreme Court deadline of September 27.

CNBC-TV18's Archana Shukla, quoting sources, reports that in a high profile meeting held on Thursday, the GoM has agreed to limit price control only to the National List Of Essential Medicines (NLEM). Also Read: Drug pricing policy proposal in next two weeks: Pawar
It should be a relief for most pharma companies as the earlier plan was also to include all combinations of drugs as that would have increased the span of control to over 75 percent of drugs.
But now sources indicate that the GoM has reached a consensus that includes limit the span of control to only the National List of Essential Medicines (NLEM), which includes 348 bulk drugs and about 652 formulations - about 30 percent of the market.
So, the price control is only on 30 percent of the market. This is the first decision that the GoM has arrived at a consensus and finalised on at Thursday 's meeting. The other decision which is still under evaluation is the methodology that will be used to the fix prices of these 348 bulk drugs.
Out of the six options suggested to the GoM by different stakeholders, three have been shortlisted - one was suggested by the Prime Minister's Economic Advisory Committee. The second option includes taking a weighted average price of all brands, which have a market-share of more than 5 percent and the third option entails the use of weighted average prices for all the drugs which have a market-share of more than 1 percent .
To decide on at least one of these three options, the GoM has asked for more data analysis. They want to see how drugs have been priced in other emerging countries with similar platforms as India.
This is ahead of Supreme Courts deadline of September 27 which mandated that if the policy is not finalised in the next two weeks, the apex court will issue a directive to place all 348 drugs under the cost-based pricing method and price control.
Sources also indicate that the data analysis will take some time. The government may file an affidavit at the Supreme Court to seek an extension.