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Pharma Dept proposes negotiating patent drug rates with firms

Last Updated: Sunday, September 2, 2012 - 15:21

New Delhi: The Department of Pharmaceuticals (DoP) is understood to have proposed direct negotiations with companies for reducing prices of patent drugs to the rate comparable to the lowest available in the global market.

The department is the convener of an inter-ministerial group comprising DIPP and the Health Ministry to modulate a pricing mechanism for patent drugs in India.

According to a highly placed source, DoP has reached out to the Ministry of Health to negotiate with companies to bring down the cost of patented drugs in the country.

"Negotiation with companies is needed and they should sell these drugs at the lowest price possible, as being sold in various other countries," the source said.

There are around 18 patent drugs being marketed in India with a total market value of around Rs 4,000 crore to Rs 5,000 crore, about 12 percent of the overall domestic market.

At present, there is no system of price negotiation for patented drugs in the country. Under the provisions of the Drugs Price Control Order, 1995, the prices of only 74 bulk drugs and formulations containing any of these scheduled drugs are controlled.

The government can, however, dictate prices of patent drugs in rare circumstances by invoking compulsory licensing.

In March this year, India Patents Office had invoked compulsory licensing permitting Hyderabad-based Natco Pharma to manufacture and sell cancer-treatment drug Nexavar at a price, over 30 times lower than charged by its patent-holder Bayer Corporation.

Natco was allowed to sell the drug at a price not exceeding Rs 8,880 for a pack of 120 tablets required for a month's treatment as compared to a whopping Rs 2.80 lakh charged by Bayer for its patented Nexavar drug.

As per the WTO agreement, a compulsory license can be invoked by a national government allowing someone else to produce a patented product or process without the consent of the patent owner. It is done for the cause of public health.


First Published: Sunday, September 2, 2012 - 15:21
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