NPPA Allows 1.74% Price Hike for Essential Drugs, No Govt Approval Needed
New Delhi: The National Pharmaceutical Pricing Authority (NPPA) has permitted manufacturers to increase the Maximum Retail Price (MRP) of scheduled formulations by 1.74028% for the calendar year 2024, based on the Wholesale Price Index (WPI) data for the preceding year 2023.
The price hike, though marginal, comes in the wake of inflationary pressures on pharmaceutical manufacturing, particularly due to increasing input costs. While it provides some breathing space for manufacturers, concerns remain regarding its impact on affordability of essential medicines.
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According to an Office Memorandum (OM) issued by NPPA on March 26, 2025, the decision follows the provisions of Paragraph 16(2) of the Drug Price Control Order (DPCO), 2013, which allows manufacturers to adjust prices of essential medicines listed under Schedule-I of the DPCO, 2013. The OM states;
"Based on the Wholesale Price Index (WPI) data provided by the office of the Economic Advisor, Department of Industry and Internal Trade, Ministry of Commerce and Industry, the annual change in WPI works out as (+)1.74028% during the calendar year 2024 over the corresponding period in 2023."
The NPPA further clarified that manufacturers do not need prior approval from the government to implement the revised prices, as per the DPCO provisions. The memorandum specifies;
"As per provisions of Paragraph 16(2) of Drug Price Control Order (DPCO) 2013, the manufacturers may increase the Maximum Retail Price (MRP) of scheduled formulations on the basis of this WPI and no prior approval of the Government in this regard shall be required."
Welcoming the decision, AIOCD General Secretary Rajiv Singhal said," The move will assist the pharmaceutical industry in adjusting prices, as the cost of raw materials and other expenses continue to rise."
This, he noted, will provide some relief to the industry.
Regarding the impact on the market, he highlighted that it will take time for medicines with revised prices to reach consumers.
"It will take approximately two to three months for medicines with revised prices to reach the market, given that around 90 days’ worth of saleable stock is typically available in the supply chain," Singhal added.
The NPPA has maintained its stance on price regulation to ensure that drugs under National List of Essential Medicines (NLEM) remain accessible to the public. The latest WPI-based adjustment aligns with the government’s pricing policy, balancing industry sustainability and consumer protection.
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