Industry Seeks DoP's Shift to Prospective Batch Pricing

The current system, which enforces immediate implementation of ceiling prices, has led to logistical challenges and frequent disputes.

Industry associations have called on the Department of Pharmaceuticals (DoP) to adopt prospective batch pricing to alleviate issues arising from the Drug Prices Control Order (DPCO). 

The current system, which enforces immediate implementation of ceiling prices, has led to logistical challenges and frequent disputes.

Under the existing regulations, ceiling prices for pharmaceuticals take effect as soon as they are announced. This abrupt change creates significant challenges for approximately nine Lakh pharmacies across the country, which must quickly adjust their pricing structures to comply with the new regulations.

Industry stakeholders have proposed that price adjustments should apply to future batches of pharmaceutical products rather than existing stock. 

This modification aims to reduce compliance burdens and avoid potential disputes over alleged overcharging. By implementing changes gradually, the industry believes it can manage pricing more effectively and minimize operational disruptions.

Introduction of IPDMS 2.0

Earlier in 2022, The National Pharmaceutical Pricing Authority (NPPA) introduced the Integrated Pharmaceutical Database Management System (IPDMS 2.0) to streamline price submissions and regulatory compliance. 

The system centralizes the submission of pricing information, covering both scheduled and non-scheduled formulations as well as active pharmaceutical ingredients (APIs).

Additionally, the IPDMS 2.0 is designed to enhance operational efficiencies by providing a unified platform for updating pricing data. 

This system aims to ensure accurate and timely price revisions, helping companies manage their regulatory obligations more effectively.

Need for Clear Guidelines & Advance Notification

Industry experts have stressed the importance of receiving clear guidelines and advance notification from the DoP and NPPA regarding pricing revisions and stock recalls. They argue that such measures are essential to avoid disputes related to alleged overcharging at the retail level.

According to one industry representative, the current system of immediate price implementation poses substantial challenges for pharmacies and manufacturers alike. Transitioning to prospective batch pricing would enable a smoother adjustment process and reduce the risk of disputes, he noted.

"Clear and timely communication from regulatory bodies is crucial. It will allow us to manage stock and pricing changes more effectively, thereby reducing the likelihood of conflicts over pricing discrepancies," another expert added.

As discussions continue between industry representatives and regulatory authorities, there is cautious optimism that these efforts will lead to a more manageable and transparent drug pricing system. The proposed shift to prospective batch pricing, coupled with improvements in the IPDMS 2.0, is seen as a potential solution to the ongoing issues faced by the pharmaceutical sector in complying with DPCO regulations.