Drug Price Control Order Act (DPCO Act) – There are some fundamental reasons that the Drug Price Control Order Act (DPCO Act) needs to come into existence in the year 1955. This policy established the availability of essential medicines in the market at affordable prices and stock. For any developing country, expenditure on medicine is the major capital loss for the middle class and can directly impact the healthcare sector of a country.
This irrational market practice can lead to a black market and critical healthcare crises for any developing country. So, it is important to take care of the basic necessity of the citizen by creating an authority that takes care of and makes sure that each one gets essential drugs at affordable rates despite changes in the domestic or global pharma industry.
The DPCO (Drug Price Control Orders) Act comes under the Essential Commodities Act (ECA). This regulation of drug price controlling also comes under the National Pharmaceutical Pricing Authority (NPPA), i.e. accountable for the execution of DPCO 2103. The basic motto behind this Drug Price Control Policy is to establish a ceiling price for all life-saving and preventive drugs. Also, the latest implication was done in the year 2019 to ensure a balance between the producer/manufacturing interests and the consumers.
However, DPCO 2013 came into effect in May 2013 for finalizing the price of 300+ critical medicine based on manufacturing cost. Moreover, the DPCO 2013 covers much more areas following profitability and cost-effective essential medicines compared to the DPCO Act 1955. There are a series of punishments imposed for the violation of this act including fines and even imprisonment.
Here is the list of the main objectives of The Drug Price Control Order –
In a growing economy, there can be n factor responsible for increasing the selling price of medicines, especially in-demand, essential and preventive drug ranges. This can lead to chaos and even lead to black market practices. To prevent this and make sure to control these factors, DPCO Act came into existence. In this, the ceiling price is set for certain drug ranges which are updated after a few years focusing on the affordability of drugs for the common man.
Without any government authority, anyone (company or manufacturing) will interfere with the pricing depending on the market condition. So, it is important to make sure every person gets essential medicine at an affordable price. That’s why DPCO Act has a significant role to play. However, the ceiling price is defined as the fixed price according to the DPCO Act 2013 by the Govt. for scheduled formulations. This ceiling price is exclusive of local tax, and excise duty.
Essential Medicine termed was presented by WHO in 1977. Any medicine that fulfills the following criteria can come under the category of essential medicines –
Now, let’s take a look into some common characteristics of Essential Medicines –
Question – What is NPPA’s role in drug price control?
Answer – NPPA or National Pharmaceutical Pricing Authority is an independent body that controls and monitors the price of drugs in India.
Question – Who is the national-level authority responsible for fixing the prices?
Answer – There are both national, state, and district-level authority that works cordially to fix the essential medicine prices – NPPA, FDA/ State Drugs controller, and distinct Drug Inspector