The National Pharmaceutical Pricing Authority (NPPA) has issued orders fixing the ceiling prices for certain formulations. This action aims to regulate drug prices in the country. These orders were issued on March 26, 2024.
The orders specify several lists of medicines whose ceiling prices have been revised. The new prices have been provided in the order as against the dosage form & strength and unit of medicines.
The new prices take into account a minimal increase based on the Wholesale Price Index (WPI).
Additionally, manufacturers can approach NPPA for specific price approval for formulations not covered under the notification.
Drug companies with existing Maximum Retail Prices (MRPs) lower than the new ceiling prices can adjust their prices marginally based on WPI. However, manufacturers are obligated to revise prices downward if they were exceeding the new limits.
Compliances Arising From Price Fixations:
Inclusion of GST
The manufacturers may add goods and services tax only if they have paid actually or if it is payable to the Government on the ceiling price.
Furnish Information on Price Revisions
Manufacturers shall inform the Government about the price revisions in either electronic or physical form in Form-II within a period of fifteen days of such revision.
Additionally, the manufacturer shall also issue a price list in Form–V from date of Notification to NPPA through IPDMS and submit a copy to State Drug Controller and dealers.
Where an existing manufacturer of scheduled formulation launches a new drug as per the Drugs (Prices
Control) Order, 2013 (DPCO, 2013), such existing manufacturer shall apply for prior price approval of such new drug to NPPA in Form I. Similarly, any manufacturer intending to discontinue production of above said scheduled formulation shall furnish information to NPPA, in respect of discontinuation of production and / or import in Form-IV at least six months prior to the intended date of discontinuation.
Furthermore, the manufacturers of the specified scheduled formulations shall furnish quarterly return to NPPA, in respect of production / import and sale of scheduled formulations in Form-III through IPDMS.
Display of Price Lists
Every retailer and dealer shall display price list and the supplementary price list, if any, as furnished by the manufacturer, on a conspicuous part of the premises where he carries on business in a manner so as to be easily accessible to any person wishing to consult the same.
Penalties
Where a manufacturer fails to submit information on price revision, it shall be construed as non-revision of maximum retail price (MRP) and the concerned manufacturer shall be liable to deposit the amount charged over and above the pre-revised maximum retail price (MRP), along with interest from the date of overcharging.
Moreover, the manufacturers not complying with the ceiling price and notes shall be liable to deposit the overcharged amount along with interest.
