Govt proposes mandatory price negotiations

By agencies   |   Thursday, 29 December 2005, 08:00 Hrs
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NEW DELHI: Attempting to allay fears of price escalation of drugs in the post-product patent regime, the Government has proposed mandatory price negotiations for patented drugs launched in India after January 2005 in the Draft National Pharmaceutical Policy.

"The patented drugs (formulations under product patent) that are launched in India after January 1, 2005 would be subjected to mandatory price negotiations before granting them marketing approval," the draft policy, which has been circulated for comments stated.

While the department of Chemicals and Petrochemicals and Department of Health would jointly lay down the guidelines for determining the negotiated prices, the government is studying practices adopted by countries like Canada, France and Australia and some other Asian countries for framing the guidelines.

According to the draft policy, after the norms were notified, an expert committee would be constituted for carrying out the negotiations on case-by-case basis with the companies concerned.

On the other hand, in a measure, which would be a welcome relief for the pharmaceutical industry, the draft policy proposed halving the excise duty on all medicines to 8 percent from the current 16 percent.

Looking to promote research and development (R&D) in the country, the draft policy proposed tax sops to R&D oriented companies.

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