Exclusive - India likely to extend price caps to more drugs: sources
By Zeba Siddiqui
MUMBAI (Reuters) - India is likely to raise the number of drugs deemed essential and therefore subject to price caps to improve affordability, said people directly involved in the process.
A panel convened by India's health ministry met for the first time on Tuesday to consider adding more drugs to the list of essential medicines, all of which would then come under price caps, one of the people said.
The move would make the drugs more affordable in a country where 70 percent of the 1.2 billion people live on less than $2 a day and less than 20 percent are covered by health insurance.
Bringing more drugs under price controls would dash hopes for an easing of the populist drug policies of the previous federal government by the new, business-friendly Prime Minister Narendra Modi, industry analysts said.
"It is surprising that yet another committee is being formed (on price control)," a top executive at the Indian unit of a large global pharmaceutical company said, declining to be named due to the sensitivity of the issue. "This (is) quite the antithesis of what is the purported philosophy of the new government."
The panel aims to finalize within six months the expanded list of essential drugs that will be subjected to price controls, and it would take two months to make it public, another person said, after the committee's meeting.
Making more drugs subject to price caps will draw the ire of global drugmakers like Pfizer Inc (PFE.N: Quote), GlaxoSmithKline Plc (GSK.L: Quote) and Abbott Laboratories (ABT.N: Quote), all of which have a large presence in India's $15 billion pharmaceutical industry.
The global drugmakers have already been hit by wide-ranging government-imposed price reductions and a legal system with a history of disallowing patent protection in recent years in an emerging market that is a vital growth driver for the firms. Continued...