Govt promises cheap drugs. But is it also destroying the price regulator?

Vishakh Unnikrishnan @sparksofvishdom | Updated on: 8 November 2016, 11:56 IST
Govt promises cheap drugs. But is it also destroying the price regulator?
Health Minister Nadda announces 60-90% discount on drugs through AMRIT scheme.(PTI photo)

The government has decided to drop the prices of nearly 2,000 medicines, which will be made available through the Affordable Medicines and Reliable Implants for Treatment (AMRIT) programme.

At a public function at Jabalpur Medical College, Madhya Pradesh, Union Health Minister JP Nadda announced most of these medicines would be made available at 60% less than the MRP, while in some cases, there would be a 90% discount.

But while it sounds like a wonderful plan, there are just about 50 AMRIT outlets in the country. The government is planning to expand this network, and only in October, junior health minister Anupriya Patel had promised opening up 300 such outlets 'soon'. But it remains to be seen how soon this would actually happen.

UPA's similar scheme which failed

AMRIT is very similar to the Jan Aushadhi scheme, a brainchild of the erstwhile UPA government at the Centre. The UPA had launched thee scheme promising hundreds of outlets across the country which would provide cheap and affordable essential drugs.

The Jan Aushadhi campaign was launched in April 2008 by Ram Vilas Paswan, the then-minister for chemicals and fertilisers. But it didn't even come close to meeting its targets. The scheme flopped badly, with many stores closing down way.

According to the last study conducted by the Public Health Foundation of India (PHFI), only 182 Jan Aushadhi stores had been opened across 16 states/Union Territories, out of which only 111 stores were in operation as on 13 July 2015.

This obviously does not cater to the demand for affordable medicines in any sense.

Will the AMRIT scheme go the same way as the Jan Aushadhi scheme? It's too early to predict that.

Govt trying to dismantle the better alternative?

The best way to ensure drug prices don't spiral out of hand is to ensure price control of essential medicines.

The National Pharmaceutical Pricing Authority (NPPA) does exactly that. It is an autonomous body, under whose auspices health experts decide on the ceiling price of various essential drugs.

In the past year, the authority has fixed the prices of nearly 500 drugs, including those used to treat diseases like cancer, diabetes, bacterial infections and high blood pressure, much to the dismay of many pharmaceutical companies.

It seems the government is now trying to dismantle the NPPA. NITI Aayog CEO Amitabh Kant has recommending disbanding the NPPA in its present form, and constituting a separate new system where prices will only be fixed when required.