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Last Updated : Jan 12, 2018 05:05 PM IST | Source: Moneycontrol.com

Policy to cut drug prices stalled due to resistance by drug makers: Report

Close to 80 percent of the Indian pharma industry's USD 30 billion revenue came from sale of branded generics last year.

A proposal to curb prices of generic drugs by dissociating them from their brand names has been stalled due to opposition from pharmaceutical companies, sources told Mint.

According to the report, the Department of Pharmaceuticals was ordered to redraft the draft pharmaceutical policy, and a new draft is not expected in the current government’s term.

Close to 80 percent of the Indian pharma industry's USD 30 billion revenue came from sale of branded generics last year. Across the world, generics are extremely important to keep healthcare costs in check and India is now the world's largest exporter of generics.

However, even though healthcare authorities in countries like the US and Japan have taken to Indian generics very well, those same branded generics are sold in the domestic market at a higher price by the manufacturers. Generic drugs that have a brand name attached to them cost nearly twice as much as equivalent generics sold in state-run pharmacies.

Of course, pharmaceutical companies' argument is that in a market as sparsely regulated as India's, brand names on generic drugs serve as a comforting factor for both consumers and medical practitioners. But critics believe that branding is a way to arbitrarily charge greater prices.

Sun Pharmaceuticals gets 26 percent of its worldwide revenue from branded generics made in India.

Prime Minister Narendra Modi stated in April that doctors should prescribe a drug by its generic name as opposed to its brand. The draft policy called for the selling a drug only under its chemical name and the manufacturer’s name, not a brand name.
First Published on Jan 12, 2018 05:05 pm
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