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Maintaining a Pharma index could help track price fluctuations

The Indian government is in the process of instituting a pharmaceutical price// index similar to the wholesale price index in order to track drug price fluctuations for price-related decisions. At present, the government is relying on the retail audit of market research agency ORG-IMS for drug price revisions. However it is felt that the present system of price revisions based on the retail audit of formulations is not quite effective.

Drug price watchdog National Pharmaceutical Pricing Authority (NPPA) is now in discussions with ORG-IMS on the modalities of the price index and it is expected that the index will reflect the prices of 100 medicines representing all therapeutic categories, mainly relating to cardiovascular, diabetes and central nervous system. The drugs covered will be representative in each of the therapeutic class so that a price rise in a first-line therapy will sharply reflect in the index. Specialists in field say that controlling the price of a first line therapy may help reduce the price of accompanying therapies as well.

Although some are of the opinion that such a measure is not required, a major number do feel the need for a mechanism to monitor drug price movements on an ongoing basis to either impose price controls or to call companies for a negotiation whenever there is an abnormal price movement.
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