the licences of these companies cannot be cancelled if the drug companies charge more than that

Even after fixing the price of the drug on behalf of the National Pharmaceutical Pricing Authority (NPPA), the licences of these companies cannot be cancelled if the drug companies charge more than that. The Drugs Consultative Committee has said that there is no provision in drugs and cosmetics ruls to revoke the licence.

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DTAB had also refused to revoke the license

Earlier, the Drugs Technical Advisory Board (DTAB) had also refused to revoke the licences of such companies. The Standing Committee of Parliament in its 54 report has said that if the pharmaceutical company charges more than the fixed price, or decides the price of the drug at its own discretion, they should be charged with interest penalty. Consider cancellation of licences of companies for not paying fines. The health ministry has also been asked to make necessary changes in the drugs price Control Order (DPCO) and drugs and cosmetics ruls if required.

Fines to be levied from companies that raise prices arbitrarily

Nppa says that even after fixing the price, 2083 notices have been sent to the companies which hiked the price of the drug to recover fines from such companies. A fine of over six thousand 406 crore rupees has been imposed till March-2020. But, only Rs. 960 crores have been recovered. A case of four thousand 33 crore rupees is going on in the court. Nppa has the right to impose fines only.

NPPA decides the price of a drug

When a company brings a new drug, even if the same drug is in the market of another company, the price is fixed by nppa. The drug of the composition, which is already in the market, is fixed at the average price of five companies and the drug price of the new company. Some companies do not tell the NPPA, and fix the price at their own discretion. Further, the price of national list of Esshil Medicine (NELM) also decides nppa. Nppa says that rs. 12, 447 crore is saved to consumers every year by fixing or capping the price of medicines.

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