[india-drug] Do we really need Price Control for Essential Medicines?

["anita kotwani" <anitakotwani@msn.com>]

Do we really need Price Control for Essential Medicines?
**********   

Dear members,

The  Times  of  India,  June  27, 2006 has reported that the "Govt may
oppose price control for essential drugs" and the link for the article
is:
[1]http://timesofindia.indiatimes.com/articleshow/1682614.cms

The  Government  of India appointed a taskforce which recommended that
prices  of  essential  medicines  be  fixed in view of India's WTO and
TRIPS  commitments.  The  Prime  Minister's Office, however, disagreed
with   the  taskforce's  recommendations  and  characterized  them  as
retrograde  and anti-competitive in another report. The PMO has argued
that prices of essential medicines in India have been historically low
because  of  the  intensely  competitive  market structure rather than
government regulation.

Although  essential  medicines should  be  affordable  and  accessible
for the  general population,  price controls are not the best means of
cushioning  the impact of WTO and TRIPS agreements. Rather than fixing
prices,  the  regulatory  authorties should ensure transparency in the
mark  ups/margins  for  the  manufacturer, wholesalers, and retailers.
This  will  prevent  excessive  profiteering  and still prevent market
distortion.  Government  intervention  in the form of price fixing may
force  many  firms  to  stop  producing  drugs whose prices are fixed.
Secondly,  the  government  may  not periodically review the prices of
essential  medicines  once they are fixed. When regulatory authorities
and  manufacturers  are  embroiled  in legal disputes over prices, the
retail prices of these medicines cannot be revised until the judiciary
makes  a  decision.  For  instance,  a  court  ruling   with regard to
ciprofloxacin  is pending, and this has led to a wide variation in the
price of different generic equivalents of cipro.

Anita Kotwani
Reader
Department of Pharmacolgy
V.P.Chest Institute
University of Delhi
Delhi 110007
anitakotwani@msn.com