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NMC's prescription guidelines may result in serious impact: SPIC
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Gireesh Babu, New Delhi
August 23 , 2023
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The National Medical Commission (NMC)'s guidelines mandating doctors to prescribe only generic medicines will result in various issues including loss of job to at least 20 lakh people and an impact on the pharma industry as a whole, said SME Pharma Industries Confederation (SPIC).
In a letter to Union Minister of Health and Family Welfare Dr Mansukh Mandaviya, the Confederation said that there are better options available to provide affordable medicines to the public, including a decision to allow Maximum Allowable Post-manufacturing Expenses (MAPE) of between 400-500 per cent on all medicines, which could help the consumer save around Rs. 50,000 crore annually.
The letter comes at a time when the Union health minister conducted a meeting with various stakeholder organisations including the Indian Medical Association (IMA) and Indian Pharmaceutical Alliance (IP Alliance) regarding the National Medical Commission Registered Medical Practitioner (Professional Conduct) Regulations, 2023, notified by the Ethics and Medical Registration Board (EMRB) of the NMC, notified on August 2, 202. An IMA official, though did not divulge the details of the meeting, said that the "meeting went well." IP Alliance also did not offer any comment on the meeting.
SPIC, in its letter, said that while issuing the guidelines, the NMC has overlooked various facts including that there are no generic drugs available in the market without brand names. The number of Jan Aushadhi stores are too few. The annual sales at Jan Aushadhi is around Rs. 1,000 crore as compared to the over Rs. 1.5 lakh crore Indian market. These stores cannot be multiplied overnight to cater to the demand.
Except for prescriptions that go to Jan Aushadhi, the retail chemist will decide which brand to sell and the retailer sells the brand which gives him the highest profit. This will result in retailers dictating terms and buying drugs at lowest prices with highest MRPs. While the doctor is divested of brand choice, the much less educated retailer shall decide the brand, it said.
When the MAPE was mandated at 100 percent for the 74 scheduled drugs under the Drug Price Control Order, 1995, traders refused to sell these drugs owing to low margins and manufacturers reducing their production. With important antibiotics such as tetracycline, amikacin and clotrimazole which are extensively used abroad were replaced with higher antibiotics, it resulted in antibiotic resistance. SPIC said that Jan Aushadhi, with 50 per cent MAPE may have worse consequences and a price control exercise can be a future health disaster.
Besides, there is no law prevailing to control the prices of unbranded generic drugs.
"There are at least 20 lakh people engaged in the promotion of branded drugs. They will lose livelihood in one stroke. Surely, they have a Right to livelihood," said Jagdeep Singh, secretary general, SPIC in the letter.
"While the cost to patients is important, every segment has a right to livelihood and protection of investment. There are better options available," he said.
If the Government stipulates a MAPE of between 400-500% on all medicines, the consumer will save around Rs. 50,000 crore annually. Such a suggestion was mooted by Singh himself in the GOI Twelfth Plan Sub Group on Affordable Drugs in 2011 held under the Chairman NPPA. But it was instantly ignored because the MNCs objected to it right there in the meeting, he added.
"Both the DPCOs 1995 and 2013 should be scrapped because apart from being regressive, they have become extremely complicated and breed corruption. Jan Aushadhi can continue for those who want to patronise it," said the letter to the Health Minister.
Every pharma unit has incurred a cost on printing devices like cylinders, packing material like labels foils and Mono cartons. Total investment on such items could be around Rs. 5,000 crore. All this can go waste with Zero benefit to the consumer. Many small units are already struggling for survival owing to erroneous policies of the government. If Small industries are not protected, the capacity to produce affordable drugs can be lost forever.
Until a few years ago each drug brand to be produced was approved by the FDA. In addition, the government has granted Trade Marks to companies based on which each company promotes its brands. Hefty fee was paid for each brand approval and each Trade Mark is filed after due diligence. Fee is payable for renewal too. Such fee amounts to Lakhs of rupees each year to the smallest manufacturer. Besides, companies have spent huge amounts on brand promotion. The dictat can demoralize industry and entrepreneurship.
It is mandatory for each company to file an undertaking in Form 51 to the FDA as per the Drugs Act 1940 whenever a new brand is launched. Means it is an acknowledged process in Drugs Act 1940 to produce branded drugs, it added.
A drug manufactured by two different companies can have the same amount of active pharma ingredient but it is not necessary that both will have similar efficacy. The admissible margins of efficacy vary between 70% to 100% approximately in the pharmacopoeias followed by industry.
Higher efficacy drugs cost more to companies because of better API, excipients, optimising and testing costs. Many small upcoming companies excel in this field to make a name. No wonder the MNCs source from them.
But such drugs cannot be supplied to Jan Aushadhi where the drugs bear MRP with 50% Maximum Allowable Post Manufacturing Expense - which is the norm for Jan Aushadhi.
The manufacturer is obliged to print 50% extra over and above the raw material cost when supplying to Jan Aushadhi. With 35% distribution costs existing in the trade, a manufacturer cannot recover his manufacturing and testing cost because documentation alone as per new GMP guidelines cost around 15%.
"Pharma units are expensive facilities. Surely some return on investment is required. If there are no profits there shall be no investments for a better global share either," averred the Federation.
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