‘Stringent regulatory measures are required to reign in inessential medicines’

The next Government in Delhi must ensure the following in order to realise the goals of access to affordable medicines in India. Being a ‘Global Pharmacy of the South’, the Government must put in place mechanisms to make sure our public procurement is made efficient and effectively deliver rational, good quality generic medicines. Our key recommendations for the upcoming government are:

1. Both the Central and the State Governments in India must allocate 0.5 per cent of its GDP for procuring essential medicines. This is expected to reduce the household misery of paying out-of-pocket substantially.
2. Drug procurement and distribution should be modeled on the lines of TNMSC/RMSC (Tamil Nadu Medical Services Corporation/Rajasthan Medical Services Corporation). This is based on ‘centralised procurement and decentralised distribution’ or ‘pooled procurement model.’
3. Scrap the new DPCO, 2013 (Drug Price Control Order). It should be replaced with a new DPCO, that must be based on a broad-based on an updated and a thoroughly revised National List of Essential Medicines. The new DPCO must anchor its price ceiling based on cost-plus based pricing rather than market based pricing. The cost-plus based pricing should be made transparent, non-intrusive and provide adequate incentives for continued investments.
4. India has a large-scale therapeutic jungle. Several banned, bannable and inessential medicines thrive in the market. Stringent regulatory measures are required to reign in these inessential medicines. Almost 47 per cent of India’s market is composed of Fixed Dose Combinations, where only a handful of them are considered essential globally. The new Government must ensure that these are weeded out at the earliest, to make medicines safe, efficacious and cost effective.
5. Strengthen drug quality mechanisms in both central and state governments. This is required to eliminate sub-standard drugs from the market. However, ensure that big pharma companies do not conflate the quality issues with IP regime, by labelling Indian generics as spurious. 
6. Resist international pressure on revising India’s current patent regime. Safeguard and protect patients’ health by making medicines affordable. Liberal use of compulsory licensing provisions in the Indian Patents Act and stringent use of Clause 3 (D) which should disallow frivolous patents.
7. Revise foreign direct investment policies in pharma sector to stem the rising tide takeover of India’s topline pharma companies. Future investment in pharmabrownfield should remain outside the ‘automatic’ route. Investors must be required to bring in matching grants of equal proportions to the value of the investment. The matching grant must be required to be invested in augmenting/expanding production capacities and research and development activities. Obligations for local manufacturing of finished products and investment in API production should be imposed. In several verticals, where the current market reflects a monopoly/ oligopoly scenario, where very few players exist, brownfield investment must be disallowed. And this list would include vaccines market, injectibles, API, rifampicin, erythromycin, ARVs, oncology market, biosimilars, etc.

– Sakthivel Selvaraj, Senior Health Economist, Public Health Foundation of India