ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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To Regulate or Not to Regulate?

Prices of Patented Medicines in India

Medicines with valid patents generally enjoy exemption from price regulation in most countries. In India, the Drugs (Prices Control) Order lays down the rules for regulation of prices of medicines through a National List of Essential Medicines, inserted as Schedule-I of theDPCO. While any medicine that is included in Schedule-I automatically qualifies for price regulation, theDPCO exempts patented medicines that have been developed indigenously from price control for a period of five years.Can patented molecules for emerging as well as infectious diseases be brought under price regulation in India?

Pharmaceutical pricing, specifically the pricing of patented medicines, is a keenly debated issue, especially in the context of making essential medicines affordable, accessible and available to the public. While the determination of the affordability of a medicine is difficult and may depend on local and national parameters, the World Health Organization (WHO) holds that “‘affordable and fair’ price is one that can reasonably be funded by patients and health budgets and simultaneously sustains research and development, production and distribution within a country” (WHO nd). Providing medicines to the public at affordable prices is a key goal driving the public health policy design in many countries (Cockburn et al 2014).

Governments try to balance their pro-industry and welfare roles, namely, promoting and encouraging innovation in the discovery of new medicines, and making such new medicines affordable by way of various legislative measures. While governments provide incentives and protection to innovators through the instrumentalities of patents, they also strive to make these inventions “available at the marginal cost of production to maximise the benefits from diffusion and dissemination” (Subramanian 2004). The trade-off between patents and pricing controls needs to be fine and delicate, and governments need to find an appropriate balance between the rights of patentees and the requirements of the patients (Watal 2001). This article seeks to examine the need and the rationale for price regulation of patented medicines in India in the context of the high prices of such medicines.

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Updated On : 24th Jun, 2020

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