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DoP directs NPPA to recalculate ceiling prices of three antibiotics based on Cipla's applications
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Gireesh Babu, New Delhi
October 17 , 2024
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The Department of Pharmaceuticals (DoP) has referred back ceiling price fixation of three antibiotics back to the National Pharmaceutical Pricing Authority (NPPA) for recalculation, based on review applications filed by pharma major Cipla Ltd.
The review applications were ordered in favour of the company earlier this month, following separate applications filed by the company stating that the pricing authority has erred in calculation of the ceiling prices.
The formulations that has been referred back to the NPPA for recalculation are the ceiling price of Advent 1.2 mg injection powder containing amoxicillin 1000 mg + clavulanic acid 200 mg, Synclar 125 mg dry syrup 30 ml containing clarithromycin 125 mg per 5 ml, and Azee 250 mg tablet 6's containing azithromycin 250 mg.
In connection with the price fixation of Advent 1.2 mg, the company informed that the draft calculation of ceiling price was released by the NPPA on December 2022, without considering the price of its drug, which was revised in the month of April, 2022 with the implementation of Wholesale Price Index (WPI) increase. The price revision was also proved to the NPPA with the submission of invoice, Form V and snapshot of the product pack.
Even though the company submitted the representation in the prescribed format with the necessary documents and within the prescribed timelines of 10 working days, the Price to Retailer (PTR) of the brand was not included in the calculation of ceiling price, it alleged.
The company argued that non reflection of PTR in the market-based data should not be construed as non-implementation of revised MRP, since there is documentary evidence to prove the price revision. Calculation of the combination drug must be reflected based on the revised PTR of Rs. 111.52 as against the calculated Rs. 100.69, it added.
NPPA argued that the company's two brands were captured in the Pharmatrac database, which is used by the Authority for price fixation, including Advent 1000/200mg injection 10ml and Novamox CV 1000/200mg injection 10 ml with PTR of Rs 100.69 per vial and both these brands had more than one per cent market share and hence qualified for being considered in calculation of PTR.
However, Cipla has filed representation for only one brand - Advent 1.2 mg powder vial claiming revised PTR as Rs. 111.52 per vial. Besides, the company filed details of Advent 1.2 gm injection vial and Advent 1.2 gm 20 ml injection claiming revised PTR of Rs. 111.52 for both, in May, 2022.
The NPPA informed the review authority that the brand appearing in the database and the draft worksheet has 10 ml pack size and the forms submitted by the company were for 20 ml pack or for one vial. Further, the company has never represented that the pack size as appearing in the database is not correct. The price regulator argued that based on the available data, no form was filed by the company for the brand considered in the draft worksheet and hence, the price revision was not considered.
The review authority observed that there is a difference in pack size captured by the Pharmatrac database and packsize reported by the company. As the pack size reported in Form II of the company was not reflected in Pharmatrac data, the price revision in pack sizes reported by the company were not considered for price calculation.
The review authority observed that the NPPA may relook into the issue and examine with respect to the packsize as available in Pharmatrac and contention of applicant regarding pack size and revise the ceiling price on the basis of extant provisions of DPCO, 2013.
In the case of Synclar dry syrup, the company argued on the similar grounds as that of Advent 1.2 mg injection powder, stating the ceiling price calculation should have included the revised PTR of Rs. 112.80 as against the Rs. 101.95 considered by the Authority.
NPPA said that Cipla has submitted the Form II with the price details on May 2, 2022 and Form V on May, 2022 with the Authority, however, the same were inadvertently not considered by NPPA while fixing the ceiling prices.
Noting that Form II and Form V were filed within stipulated time by Cipla Ltd and the same was not considered in calculating the PTR, Senior Economic Adviser to the Government of India Awadhesh Kumar Choudhary referred back the case to NPPA for recalculation of ceiling price for the formulation clarithromycin 125 mg per 5 ml as per the provisions of the DPCO, 2013.
In the case of Azee 250 mg tablet 6's, the company argued that its product had a market share of nearly 2.3 per cent of the scheduled formulation for the period from August 2021 to July, 2022, and despite representations with supporting documents within the prescribed timelines, the Authority did not consider its brand in calculation of ceiling price. It argued that the calculation of the ceiling price of the formulation azithromycin 250 mg is incorrect and must be rectified after adding the brand pack size Azee 250 mg tablet 6's.
NPPA said that while the company filed the Form II for Azee pack of 6 and 10, on May 2, 2022 with revised PTR of Rs. 9.38 per tablet, Pharmatrac database of July, 2022 has been considered for calculation of ceiling prices and the brand was not reflected in the database for the period of August, 2021 to July, 2022.
Pharmatrac, after rechecking the data, informed NPPA that the pack of 6 was discontinued in October, 2019 and the value was zero in the current database. However, it later found that the stock keeping unit was relaunched in the month of March, 2021 and in the final data submitted in July, 2023, the details of the pack size was also included for being considered in averaging of PTR.
Observing that the company filed the Form II within the time limits and considering the anomalies in Pharmatrac database and their requisite corrections by the NPPA, the ceiling price of the formulation requires revision.
"In the backdrop of these facts, the case is being referred back to NPPA for recalculation of ceiling price for the formulation azithromycin 250 mg tablet as per extant provisions of DPCO, 2013," said the order issued by Choudhary.
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