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NITI Aayog Vs Modi: Disagreement on Affordable Drugs Widens

NITI Aayog Vs Modi: Disagreement on Affordable Drugs Widens

People walk past a chemist shop at a market in Mumbai, India. Credit: Reuters

NITI Aayog’s research on drug deregulation continues unabated, even as two Union ministers have said they will follow the prime minister’s vision on affordable healthcare.

People walk past a chemist shop at a market in Mumbai, India. Credit: Reuters
People walk past a chemist shop at a market in Mumbai, India. Credit: Reuters

New Delhi: Two Union ministers earlier this week said there are no plans to deregulate drug pricing in India, which fits with Prime Minister Narendra Modi’s vision of making medicines more affordable. However, the NITI Aayog continues to be undeterred by this. The Wire had reported last week that the NITI Aayog had been pushing for this since at least October 2016, even as the government had informed the Supreme Court, and parliament recently, that it did not plan on deregulating the minimum measures it takes for ensuring the affordability of essential medicines.

“Our view is very close to the prime minister. What the prime minister said is what we are moving towards,” said health minister J.P. Nadda, in reply to a question on this issue at a press conference in Delhi on Thursday(May 11). “NITI Aayog comes out with its views but ultimately it is upto the various departments to act. Ultimately the political will is what the prime minister wants,” he said.

Modi has made a number of comments off late, speaking in favour of making medicines more affordable. For instance, in April, Modi said in Surat, “The poor must have access to quality and affordable healthcare. After assuming office, mechanisms were put to bring down prices of medicines even if that meant pharma companies are unhappy with us.”

Yesterday (May 12), chemicals and fertiliser minister Ananth Kumar also addressed a press conference on the government’s moves to promote generic and affordable medicine. He said there was no plan to change the policy of drug pricing of essential drugs in the country. In reply to a question raised on this issue, Kumar chose to elaborate in detail the many efforts of the Modi government to expand price control for essential medicines and said that this shows the “intention” of the government.

“The first national list of essential medicines was in 2011 but the second and expanded one came in 2015. This was done by the Modi government. The UPA government took very long to do this but we did it soon after coming to power. Therefore it clears our intention. Under UPA, around 350 medicines were under drug price control. Now over 1200 drugs are under price control. Therefore our intention is very clear. All countries, even developed countries, have drug and drug price control,” Kumar said.

Meanwhile, NITI Aayog has been circulating a ‘Draft for Discussion’ within the health ministry. The draft concerns several issues related to public health and pharmaceuticals, and in one section, speaks about drug pricing. The NITI Aayog has still not responded to requests for a general interview or for specific clarifications with regards to this issue and The Wire’s report last week

NITI Aayog’s vice chairman Arvind Panagariya told Economic Times this week that “we have simply written that a medicine being put on the essential commodities list, should not automatically become subject to price regulation.” This goes against the very nature of the National List of Essential Medicines (NLEM), which is a curated list drawn up after wide consultations, to determine which drugs are absolutely essential to the public and need to be made affordable.

As reported last week by The Wire, NITI Aayog is recommending the delinking of the National List of Essential Medicines (NLEM) from the Drug Price Control Order. This move has been denied and discarded by the government in an affidavit to the Supreme Court as well as in many replies in parliament.

The NLEM is prepared at regular intervals by a committee appointed by the health ministry. In every iteration of the list, new formulations are added and old ones are removed. The list becomes a part of Schedule 1 of DPCO, 2013 and once Schedule 1 is notified, the National Pharmaceutical Pricing Authority (NPPA) can begin to cap the prices of these drugs. The DPCO aims to implement the objectives in the National Pharmaceuticals Pricing Policy (NPPP), 2012. This policy prescribes the framework for drug pricing to ensure the affordability of essential medicines while also providing opportunities for innovation to the pharmaceutical industry. The NPPA has the power to take action against companies who overcharge for medicines in the NLEM whose prices have been fixed. Up until March 10, 2017, the government has capped the prices of 680 formulations and currently uses a market-based pricing formula to do this.

Note: This piece has been edited to add new information

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