Indian Regulators Set Price Caps for More Pharmaceuticals

In mid-July 2014, India’s National Pharmaceutical Pricing Authority (NPPA) announced price controls for 50 diabetic and cardiac medicines. Drugs included in this round of price caps include heparin and atorvastatin. This move comes on the heels of substantial price reductions to more than 300 other drugs over the past 18 months. Almost 40% of the Indian pharmaceutical market is now subject to price caps.


The new price caps will reduce prices by an average of 12%, with some products’ prices reduced more than 30%. The potential business loss is estimated to be more than $100 million. The hardest hit company will likely be Sanofi, which may see up to a 32% drop in its Indian profits. Abbott and Pfizer will also be affected, as will a variety of domestic Indian pharmaceutical companies like Ranbaxy.


However, some pharmaceutical companies in India have refused to revise the prices of the 50 newest price controlled drugs. Several domestic industry groups have filed court petitions and are lobbying for government intervention. In one of the cases, the Delhi High Court has refused to grant a stay order — though the trial will continue in late September 2014.


Aside from cardiovascular and diabetic treatments, the NPPA has announced that it will monitor the prices of drugs in other key therapeutic areas — including cancer, malaria, tuberculosis, asthma, HIV/AIDS and vaccines. It is expected that further generic cancer drug price controls will be announced next, affecting products such as Pfizer’s Refolinon folinic acid.