Parliamentary Panel Slams NPPA, Demands Permanent Audit of Anti-Cancer Drug Prices

The Committee’s Fourteenth Report, titled “Price Rise of Medicines in the Pharmaceutical Sector Impacting the Lives of Ordinary Citizens – A Review”, highlighted systemic gaps in price regulation and recommended urgent reforms.

Key recommendation on anti-cancer drugs

“The Committee observe that the absence of a legal provision to audit drug costs under the existing law limits the ability to check whether MRPs of cancer medicines are truly justified. The Committee find that although NPPA is endowed with exceptional powers to cap prices and margins, the lack of a permanent, legal mechanism for trade margin control remains to weaken long‑term price regulation and transparency and needs to be addressed with top priority and urgency. The Committee therefore, strongly recommend that the Department urgently introduce a clear legal provision in the Drug Price Control Orders (DPCO), 2013, by way of appropriate amendments for effective implementation of Trade Margin Rationalisation (TMR). The Committee feel that relying only on exceptional power clauses may not be sufficient to protect public interest in the long term and a permanent, transparent system must be put in place at the earliest to regularly monitor MRPs and trade margins for life‑saving drugs like anti‑cancer medicines. The Committee therefore desire that in order to ensure fair pricing, prevent unjustified markups, and make essential treatments more affordable for patients, the policy formulation process must be expedited to be followed by earnest implementation process. The Committee may be apprised of the action taken in the matter.”

The Committee noted that the absence of a statutory cost-audit mechanism makes it difficult to ensure that MRPs of high-value drugs, particularly oncology medicines, are justified. While NPPA relies on exceptional powers under paragraph 19 of DPCO, these measures are temporary and insufficient for long-term oversight. The DoP and NPPA, in their submissions, stated that consultations on Trade Margin Rationalisation (TMR) were ongoing and under examination.

Recommendations on non-scheduled and high-priced medicines

The Committee also reviewed non-scheduled medicines and highlighted the need for margin rationalisation to prevent excessive markups.

“The Committee note that NPPA has capped margins on certain non-scheduled medicines under paragraph 19 of DPCO, 2013. However, the Committee feel that a permanent legal mechanism is necessary to ensure long-term transparency and prevent arbitrary pricing, particularly for life-saving and high-cost medicines.”

The report emphasizes that while NPPA has intervened in high-cost drugs (such as select anti-cancer brands) to reduce trade margins, such measures are temporary and need to be institutionalized to safeguard patient interests.

Recommendation on devices and stents

In addition to medicines, the Committee recommended a review of pricing for critical medical devices, including stents, to protect patients from excessive markups:

“The Committee strongly recommend that the DoP consider bringing medical devices such as coronary stents under the ambit of DPCO or similar regulatory oversight to prevent unjustified price escalation and ensure affordable access for patients.”

Follow-up and monitoring

The Committee has requested the Department to submit updates on the action taken regarding all recommendations, including amendments to DPCO for Trade Margin Rationalisation and potential inclusion of devices under price control measures. The report stresses urgency in policy formulation and implementation, highlighting that existing exceptional powers alone cannot guarantee fair pricing.