Non-Scheduled Drug Prices Likely to Increase by Up to 10% from July

New Delhi: Retail prices of several non-scheduled medicines are likely to witness an increase from July onwards as pharmaceutical companies begin transferring the burden of rising production costs to consumers following a steep surge in prices of active pharmaceutical ingredients (APIs) and bulk drugs linked to the ongoing West Asia conflict.

According to the recent media report in The Times of India, industry representatives and trade bodies stated that prices of many APIs and bulk drugs have increased by nearly 30 to 50 per cent since February, significantly affecting manufacturing costs for pharmaceutical companies. In response, many drug manufacturers have already revised prices of non-scheduled medicines upward by up to 10 per cent during April and May. However, the effect at the retail level is expected to become visible only after newly priced batches reach pharmacies and distributors.

The anticipated price hike is expected to impact a wide range of commonly used medicines, including painkillers, antibiotics, vitamin and mineral supplements, dermatology products, certain respiratory medications, and psychotropic drugs.

Under the provisions of the Drug Price Control Order (DPCO), the government this year permitted only a marginal increase of 0.6 per cent in the prices of scheduled drugs, which include essential medicines listed under price control. At the same time, manufacturers of non-scheduled medicines continue to have the flexibility to increase prices by up to 10 per cent once annually.

Industry data indicates that approximately 384 drugs and 1,109 formulations and combinations are covered under the scheduled drug category, while a much larger segment of widely consumed medicines used for fever, pain management, skin disorders, and nutritional supplementation remain outside direct price regulation.

Commenting on the situation, Gokul Jaykrishna, Chairman of FICCI Gujarat, told TOI,

"After remaining stable for two years, bulk drug prices increased sharply due to the West Asia conflict, hurting pharma companies’ margins."

Dr Viranchi Shah, National Spokesperson of the Indian Drug Manufacturers’ Association (IDMA), stated that the industry body is currently in discussions with the government seeking temporary relief measures under DPCO provisions in order to balance the interests of both patients and pharmaceutical companies.

Meanwhile, Amit Thakkar, President of the Drug Marketing and Manufacturing Association, stated that companies are utilising their annual price revision window to compensate for the unusually high increase in raw material expenses.

"This year, input costs have risen much more than usual, so many companies are implementing the maximum increase allowed under their pricing review cycle,” he told TOI. He further pointed out that apart from APIs, the cost of packaging materials has also increased substantially this year, adding further financial strain on manufacturers.

Jashvant Patel, President of the Federation of Gujarat State Chemists and Druggists Associations, stated that consumers may not immediately experience the revised prices because older inventory stocks are still available within the supply chain.

He added that consumers are likely to witness the revised medicine prices from July or August, as the existing stock available across the supply chain is expected to last for another three to four months before newer batches with revised prices reach the market.

Pharmaceutical industry bodies have also urged the government to consider allowing an additional price hike this year in view of the unprecedented rise in input and manufacturing costs impacting domestic drug manufacturers. Sources further stated that the government is examining possible safeguards to ensure that any future decline in raw material prices is adequately reflected in medicine prices for consumers.