Jan Aushadhi Kendras are now established as part of the Pradhan Mantri Bhartiya Janaushadhi Pariyojna, promising significant cost savings for the public ranging from 50% to 90% on the purchase of generic medicines from these approximately 10,000 centers nationwide. These centers have an average monthly sale of around Rs 1.50 lakh per month per center. A more effective approach could be achieved by imposing a maximum trade margin of, let’s say, 30% on all medicines and medical consumables, including generic medicines, between the ex-factory price and the maximum retail price (MRP).
Currently, there is a substantial trade margin, particularly on generic medicines, where distributors obtain a box of 10-20 strips at about one-tenth of the printed MRP. Even branded medicines exhibit varying trade margins. For instance, a box of 10 strips of Bifilac-HP, with a total printed MRP of Rs 2,100 per box, is available with the distributor at just Rs 1,140 per box.
The World Health Organization (WHO) has identified that essential drugs in India, even with the lowest printed MRP, are excessively priced over manufacturing costs, primarily due to high trade margins. This holds true for other medical consumables as well. The pricing irregularities extend to the packaging of medicines, with manufacturers sometimes reducing the number of lozenges per strip or altering strip sizes to influence consumer perceptions.
To address these issues, the National Pharmaceutical Pricing Authority (NPPA) should mandate compulsory packaging in units of 1, 2, 5, 10, 20, 50, 100, 200, 500, 1,000, and higher multiples, unless specific permission is granted for alternative packaging. Additionally, medicine packaging should prominently display the medicine’s name on each tablet or capsule.
Furthermore, the ex-factory prices of branded medicines with the same basic salt exhibit significant disparities. The practice of categorizing medicines for price regulation should be eliminated, and a standardized pricing mechanism should be established. The NPPA should implement a system where drug companies are allowed a basic profit margin on all types of drugs, with price revisions limited to once a year.
The issue of unreasonably high trade margins has been acknowledged by the Competition Commission of India (CCI), and corrective measures are needed, especially for non-essential and generic medicines. The quality of generic medicines in the Indian market should match export standards to enhance the country’s reputation and foreign exchange earnings.
Addressing the illegibility of prescriptions, the judiciary has recommended computerized prescriptions, with user-friendly software developed by the Union health ministry. Dual pricing in health services, including tests for normal patients and those under the Central Government Health Scheme (CGHS), should be prohibited.
To respect the sentiments of the majority vegetarian population, there should be encouragement for vegetarian cellulose capsules over non-vegetarian gelatin capsules. Hospitals receiving subsidized land should declare themselves as public authorities under the Right to Information (RTI) Act or pay the market price for the land.
In the interest of public health, the Union health ministry should promptly ban harmful medicines, taking cues from international decisions. Action should be taken against celebrities endorsing medicines without proper knowledge, and a complete ban on medicine advertisements should be considered.
Finally, the Union health ministry should establish an expert committee to study the after-effects of artificial health food and cosmetic surgery, allowing only certified health food to be sold.
Courtesy: Drugstore Deception: The Shocking Truth about India’s Medicine Market- Subhash Chandra Agrawal- Moneylife