SCHOOL OF LEGAL STUDIES

COCHIN UNIVERSITY OF SCIENCE AND TECHNOLOGY

NATIONAL CONFERENCE ON
HEALTH CARE SYSTEM IN INDIA AND HUMAN
RIGHT CONCERN

DRUG PRICING POLICY

DRUG PRICING POLICY: NEW AGE CHALLENGES

 AUTHORS:
JAYADEEP SAJAN (jayadeepsajan@gmail.com)

MOB:918547330594

ABEL JIJY JOHN (abeljijy016@gmail.com)

MOB:919400702977

KERALA LAW ACADEMY LAW COLLEGE,

PEROORKADA,

THIRUVANTHAPURAM,

695005
 ABSTRACT

The pricing of medicines has always been an issue of great social, political and
economic significance across the globe. With its large population and high disease
burden, the availability of medicines at affordable prices becomes a necessity. In
light of these facts sensible drug pricing becomes an essential factor. The Indian
pharmaceutical Industry, driven by knowledge, skills, low production costs and
international quality products has witnessed a robust growth. It is, globally, the
3rd largest producer of medicines by volume yet 14th in terms of value. The lower
value is due to the fact that Indian medicines are amongst the lowest priced in the
world. However, despite this medicine costs continue to be an important
component in the overall medicare expenditure in the country. This note clearly
evaluates the challenge faced in Drug Pricing Policy.

The regulation of prices of drugs in the National Pharmaceuticals Pricing Policy

2012 would be on the basis of essentiality of drugs. This is different from the
economic criteria/market share principle adopted in the Drug Policy of 1994.
Control over drug prices can be only one element of an overall strategy for
provision of affordable healthcare. The continuation of an effective, innovative
drug industry would be an equally important part of such a strategy. Pricing policy
faces enormous challenges due to high disease burden and abundant poverty
with low insurance penetration. Limited drugs under price control as
pharmaceutical companies play an important role in regulating policy. In the light
of the ongoing debate the role of price control is challenged. It is true that Tamil
Nadu and Kerala models has successfully adopted method in increasing
healthcare access, but need more enhancement. There is a dramatic change in
healthcare access but, role of drug price control is not yet clear. India needs to
balance the healthcare sector of neglected population and the monetary impact
of such steps on the other side. With innovative policymaking, the improvement
of quality, affordability and access can be achieved.