Revise MRP of drugs given custom duty relaxations in budget: NPPA directs Pharma Firms, Marketers
New Delhi: The National Pharmaceutical Pricing Authority (NPPA) has directed all drug manufacturers and marketers to reduce the Maximum Retail Price (MRP) of medicines that recently received customs duty exemptions or reductions in the Union Budget.
This move aims to ensure that the benefits of lower duties are passed on to consumers.
In an office memorandum released on Monday, the NPPA instructed manufacturers to revise MRPs for 36 drugs that have been fully exempted from customs duty and six drugs that now attract a concessional 5% duty.
“All manufacturers and marketing companies selling drugs/formulations mentioned in the notification issued by the Department of Revenue are required to revise the MRP on account of the reduction/exemption of customs duty,” the NPPA stated.
Additionally, the regulator has mandated that manufacturers submit details of the revised pricing through Form II and Form V. “Manufacturers shall issue a price list or supplementary price list to dealers, state drug controllers, and the government indicating changes,” the order added.
While Form 2 is used for scheduled formulations, Form 5 applies to both scheduled and non-scheduled formulations.
Citing the Drugs (Prices Control) Order (DPCO) 2013, the NPPA emphasized that the MRP of drugs and formulations is inclusive of taxes and duties. “Any downward revision in duties and taxes should be reflected in the MRP, ensuring that the benefit of nil duty or duty reduction is passed on to consumers,” the order stated.
In the Union Budget for FY 2025-26, the Finance Minister announced a full customs duty exemption for 36 life-saving drugs and the inclusion of six additional medicines in the concessional category, now subject to a reduced 5% customs duty. These include Mepolizumab, used to treat severe asthma, as well as anticancer drugs like Asciminib and Daratumumab. Additionally, Brentuximab Vedotin, used in cancer treatment, and Ocrelizumab, prescribed for multiple sclerosis, have been added to the concessional duty list.
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According to a recent report in The Economic Times, these medicines are not manufactured in India and are marketed by major pharmaceutical companies such as MSD, Roche, GSK, AstraZeneca, Pfizer, and Takeda. The government has clarified that while most drugs attract a basic customs duty of 10%, certain life-saving drugs and vaccines are subject to concessional rates of 5% or nil.
