Tightening of the control raj upsets Pharma Inc
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The proposed National Pharmaceutical Policy has turned out to be a bitter pill for Pharma Inc. Union Chemical Minister Ram Vilas Paswan's enthusiasm in adding 354 new drugs to the price control net is being strongly opposed by pharmaceutical manufacturers who are reeling under the effects of the product patent regime.
Currently, only 74 drugs are included in the list. ''The pharma industry is poised to become a sunrise sector. However, regulatory shocks like the increase in the price control would be detrimental to the industry and the economy,'' Nicholas Piramal Chairman Ajay Piramal said while commenting on the new policy.
In the '70s, 100 per cent of the drugs sold were under price control. Since then, the government has been progressively reducing the number of drugs under the net. However, Paswan points out that the recent move of increasing the price control net is due to Supreme Court's observation that suggested to the government to look at the affordability and availability of essential drugs to the common man.
The pharma industry is worried over the proposed move as control on 374 drugs which represent nearly 70 per cent of the total market would severely hit their bottomlines.
The ministry, however, claims that the 354 formulation drugs that are proposed to be brought under price control will form only 8 per cent in value terms, while the existing 74 bulk drugs and their formulations, account for 25 per cent. ''Only 33 per cent of the medicines would be under the price control umbrella,'' Paswan says.
''Generally, Indian companies spend only five per cent of their total revenue on R&D compared to nearly 20 per cent by MNCs. This move would in a way reduce the ability of Indian companies to put more money into research,'' Indian Drug Manufacturers Associations Dara Patel said.
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