India’s drug price regulator has turned down a request by more than 650 drugmakers for an across-the-board increase in the prices of 33 bulk drugs. The firms had called for the rise because, they say, the steady appreciation of the rupee against the US dollar and falling prices of pharmaceutical raw materials, which prompted the National Pharmaceutical Pricing Authority (NPPA) to cut the drugs’ prices by up to 10% in March, no longer apply.

The rupee’s value is falling and raw materials prices are rising fast, says the Indian Drug Manufacturers Association (IDMA). There is a shortage of intermediates and manufacturers are having to pay more for bulk drugs, especially from China, plus customs duties, which means that, combined with the low margins which are currently allowed for such bulk drugs, they are now carrying heavy losses, said the IDMA. Without an immediate increase in prices of these bulk drugs, some manufacturers would have to stop producing the treatments made from them, leading to shortages, it added.

However, the NPPA told drugmakers late last week that it cannot implement an across-the-board reversal of its price cuts, although it added that it will consider individual applications from companies, on presentation of evidence of their problems.

Meantime, on June 5 the NPPA announced changes to the prices of 438 medicines, with around 300 being cut and the remainder being awarded increases. It also cut the prices of two non-price-controlled products – Dr Reddy’s Enam 5 and Nirma’s Ringer Lactate Solution injection – because these had increased by over 10% within a year, and it fixed the prices of four bulk drugs – analgin, nalidixic acid, spironolactone and frusemide.

MNCs adopt “India-specific” pricing

Moreover, the Economic Times of India reports that multinationals are planning to launch new drugs in India at prices far below the levels which they charge globally. For example, Daiichi Sankyo wants to launch its antihypertensive Benicar (olmesartan medoxomil) 200mg tablet in India within the next two months at a cost of 9-10 rupees, compared with its equivalent price in Europe of 42-50 rupees, and is in talks with local drugmakers to ensure production so that the Indian price can be kept low.

Similarly, Merck & Co’s diabetes drug Januvia (sitagliptin) is on sale in India at about one-fifth of its US price, a policy which the company says it will adopt for further launches in India, while Pfizer’s smoking-cessation drug Champix (varenicline) costs less than half in India as it does in the USA, and GlaxoSmithKline has said it will launch its cancer treatment Tykerb (lapatinib) in India at a 25% discount to its global price.