India's SPIC calls on government to cap profit margins of all medicines

India’s SME Pharma Industries Confederation (SPIC), which represents thousands of small pharmaceutical units spread across the country, has urged the government to bring in a legislation to put a blanket cap on profit margins of all medicines irrespective of whether they are under the Drug Price Control Order (DPCO) or not as a measure for making available quality medicines at affordable prices.

In a letter written to Prime Minister Manmohan Singh, and chairman and members of the parliament standing committee on health, SPIC chairman Rohan Hede said that all medicines produced in India should carry MRP (maximum retail price) with 300% Maximum Allowable Post-manufacturing Expense (MAPE), which can easily be worked out by the National Pharmaceutical Pricing Authority (NPPA), reports the local sector news service PharmaBiz. This will slash medicine prices to 40%, and stop making India the most lucrative 'mandi' for multinationals and also save the SMEs who are the only willing partners in price control.

Implementing a Uniform Code of Marketing Practices (UCMP) to refrain companies alone is meaningless. Prime Ministerial intervention in 2006 to get excise levied on contract manufacturing in excise free zones to stem the rot did not succeed. The DPCO, which covers less than 10% of the market, is an abject failure because one company alone is 75% violator but goes scot-free having received stay order from Supreme Court, the SPIC said, according to PharmaBiz.