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RSS Affiliate Writes to Government on Department of Pharmaceuticals, Alleges Industry Collusion

The Swadeshi Jagran Manch has accused the pharmaceutical department of undermining the National Pharmaceutical Pricing Agency and diluting its powers.

A letter by an RSS affiliate alleges that wings of the ministry of chemicals and fertilisers are working against making healthcare affordable. Credit: Reuters

Swadeshi Jagran Manch (SJM), the economic wing of the Sangh parivar, has written to the minister of chemicals and fertilisers, Ananth Kumar, alleging that certain wings of his ministry are working against making healthcare and medicines affordable to the public.

The letter is aimed directly at the department of pharmaceuticals (DOP), which is under the Ministry of Chemicals and Fertilisers. The SJM alleges that the “DOP is working against the stated objectives of prime minister as well as your ministry.”  The letter was also sent to Union health minister J.P. Nadda, CEO of the NITI Aayog Amitabh Kant, secretary of the DOP Jai Priye Prakash and the chairman of the drug price regulator Bhupendra Singh.

The letter raises four major issues, with the bulk of the focus on India’s drug price regulator, the National Pharmaceutical Pricing Agency (NPPA). There are “severe, unwarranted intrusions in the functioning of the NPPA and undermining of the authority delegated to it,” it says.

The letter was sent to the Kumar a few days before a draft of the pharmaceutical policy was circulated to various industry and civil society bodies. The Wire has previously reported on this new draft policy. Some of the issues the SJM raises in their letter find space in the draft policy. In the draft prepared by the DOP, the government repeatedly expressed its intention to provide affordable healthcare. It spoke of the importance of government interventions via price control and also discussed at length several ways of changing the structure of the NPPA.

“The major issue is they want to take away paragraph 19 from the NPPA,” says Ashwani  Mahajan, the national co-convenor of SJM. Paragraph 19 is a section of the drug price control order, which allows the NPPA certain “extraordinary powers” to take quick and independent decisions, free of control and review from the DOP. “It is paragraph 19 that allowed NPPA to fix prices like they did recently with knee implants. Paragraph 19 also allows NPPA to fix the prices of items not covered by the National List of Essential Medicines (NLEM),” he says.

SJM bats for preserving powers of NPPA

The letter first talks about some efforts by the government that the SJM sees as “undermining” the NPPA. They recall their previous letter in May, reported by The Wire, where they wrote to the prime minister alleging attempts by NITI Aayog, DOP, the department of industrial policy and promotion (DIPP) and the health ministry to delink the NLEM from the drug price control order, which allows for the government to cap the prices of drugs on this list.

“We cannot discount the earlier attempts by the DOP along with the NITI Aayog and secretaries of the ministry of health and family welfare (MOHFW) and the DIPP to dismantle the NPPA and dilute price control measures,” they wrote.

They also raised the issue of privatisation in healthcare which NITI Aayog has been aggressively pushing. NITI Aayog recently wrote to all state governments about privatising portions of district hospitals. The SJM says the policy think-tank is “fully occupied with advancing the interests of private players.”

The SJM also raised the issue of the DOP using office memorandums to override decisions already taken by NPPA regarding pricing of drugs. The month of April saw the DOP issuing a number of memorandums, all reviewed by The Wire, pertaining to different aspects of pricing and on different decisions of the NPPA. “These OMs are an attempt to over-ride and alter the NPPA’s consistent procedures in implementing the DPCO in accordance with the law, so as to favour the pharmaceutical industry at the expense of poor patients,” says their letter to the minister. They say these are attempts to “supersede/ encroach/ undermine the scope of the NPPA.”

For example, a memorandum dated April 4 said, “Any drug not included in NLEM should not be part of DPCO Schedule 1.” The status so far has been that the NLEM was the first and most basic list prepared by the health ministry. But Schedule 1 could include more drugs than the NLEM and cap the prices of this longer list. The DOPs memorandum in April effectively clipped this flexibility. Another memorandum from the same day overruled NPPA’s decisions on prices for about 150 formulations and allowed an overnight increase of 10%.

The SJM also raised the issue of the new pharmaceutical policy. As they had sent this letter before the draft policy was actually circulated, their letter demanded that the policy be made in a transparent manner, consulting with public health groups. An earlier consultation organised by the DOP on this policy, had only planned to invite industry bodies such as the Indian Drug Manufacturers’ Association, the Indian Pharmaceutical Association, the Organisation of Pharmaceutical Producers of India, the Federation of Indian Chambers of Commerce and Industry, the Confederation of Indian Industry and the Associated Chambers of Commerce and Industry of India. A consultation planned for August 30 has now invited civil society organisations along with the various industry bodies. As per the schedule for this consultation, only industry bodies are being given time to present their “key takeaways” at the end of this consult.

With the policy now in circulation, Mahajan says, “The new policy is allowing the DOP to keep reviewing what NPPA has done. The DOP has always been using this review for the benefit of companies. As we wrote in our earlier letter to the prime minister, these departments had wanted to finish off the NPPA. Now that they were not successful in that, they are trying to at least finish off the NPPA’s powers. The prime minister’s dream is to make medicines affordable. They are working against it.”

At the end of the letter, the SJM also says they believe in a rational, cost-based system of pricing for drugs. India followed a cost-based model until changes were made in 2013, moving the pricing mechanism to a market based one. This current mechanism has “failed to check the unabated profiteering of pharmaceutical companies,” whereas the cost-based system is “the most effective way of ensuring affordability and access to medicines to the public and also providing a reasonable profit to companies,” it says.