India removes cap from patented rare disease drugs

India’s Department of Pharmaceuticals (DoP) has removed a price cap from a range of essential patented drugs used in the treatment of rare diseases.

The change, instituted on Thursday, January 3, will affect the prices of orphan drugs, used for treating rare medical conditions. It will also mean that medicines developed by foreign companies will be exempt from price control for five years.

Previously, only locally developed and manufactured drugs had this incentive.

Prior to the change, India’s National Pharmaceutical Pricing Policy capped the prices of 652 commonly-used drugs, as well as all imported drugs. The maximum limit companies could charge for a drug was calculated using the mean of the prices of all brands with more than 1% market share in the total turnover of the medicine.

The change comes despite concern from India’s health ministry. On November 29, health secretary Preeti Sudan wrote a letter to the DoP which warned against the “exorbitant cost” of life-saving drugs for rare diseases.

Sudan told Indian newspaper Mint that her letter asked the DoP’s secretary, Jai Priye Prakash, to “explore the feasibility of capping drug prices so that their prices become affordable to patients”.

“The cost of treatment is unaffordable even for patients who are not poor,” she added.

The DoP has defended its decision. According to Mint, senior DoP officials said the move aimed to give Indian patients access to drugs that are currently only available abroad.

Officials said the policy will encourage the production of more drugs for orphan diseases.

“As the number of people affected by rare diseases is low, not many companies invest in these drugs. The step has been taken to incentivise companies, to encourage them to manufacture drugs for rare diseases,” said an official.

This has been contested by civil rights activists, who called the move a “pro-pharma” step with “no element of public interest”.

According to non-profit organisation All India Drug Action Network’s co-convenor Mailini Aisola, the move will also have a negative impact on India’s drug manufacturing industry, as it could discourage Indian firms from developing and producing patented drugs.

“It is unjustifiable that the government has taken a drastic step to favour foreign companies,” she told Times of India.

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