F.No. 9(19)/05/DP/NPPA

Government of India
Ministry of Chemicals & Fertilizers
Department of Chemicals and Petrochemicals
National Pharmaceutical Pricing Authority

YMCA Cultural Center Building,
1, Jai Singh Road, New Delhi-110001
Phone : 011-23345116/18, Fax : 23445119
Dated : 27th December, 2005

Explanatory Note

Subject: Press release on the decisions of the NPPA in its 83rd meeting held on 27.12.2005.

The National Pharmaceutical Pricing Authority (NPPA) held its 83rd meeting on 27.12.2005 and has decided to fix / revise the prices of bulk drugs and formulations as given below :

Bulk Drugs

The prices of bulk drugs Sodium Penicillin G, Procaine Penicillin G, Benzathine Penicillin G, Phenramine Maleate, Trimethoprim, Pentoxyphylline, Phenylbutazone, Frusemide and Rifampicin were considered in the meeting. After detailed cost cum techno economic study, the existing prices of following bulk drugs have been revised downwards; Sodium Penicillin G from Rs.1207/BU to Rs.824/BU, Procaine penicillin G from Rs.1357/BU to Rs.971/BU, and Benzathine Penicillin G from Rs.2469/kg. to Rs.2055/kg. This works out to a downward revision of 31.73%, 28.45% and 16.77% respectively in comparison to the earlier notified prices.

The prices of bulk drugs Pheniramine Maleate, Trimethoprim, Rifampicin were revised to Rs.1107/kg., Rs.840/kg., Rs.3560/kg. from the existing notified prices of Rs.1068/kg., Rs.700/kg., Rs.3480/kg. respectively. The prices were revised after conducting a cost price study. The increase works out to 3.65%, 20% and 2.30% respectively. The increase is mainly due to the rise in prices of input raw materials. It is estimated that the prices of medicines based on bulk drug Pheniramine Maleate will go up by 1 to 2 %, those based on bulk drug Trimethoprim would increase by 4 to 5%, while Rifampicin based medicines are expected to show an increase of about 2%.

The Authority decided that in respect of bulk drugs Pentoxyphylline, Phenylbutazone and Frusemide the existing price be continued.

Formulations

The Authority approved the proposals for revision of norms for Conversion Cost (CC), Packing Charges (PC) and Process Loss (PL) and Packing Material (PMC) under para 7 of DPCO, 1995.

Para 7 of DPCO, 1995 specifies fixation of norms for CC (Conversion Cost), PC (Packing Charges) and PL (Process Loss) every year by notification in the Official Gazette. Accordingly, the Authority after examination of the recommendations of the Cost Accounts Branch (CAB), Ministry of Finance with regard to CC, PC and PL cleared these norms for notification. The norms for CC and PC in majority of the cases have increased while there is reduction in the Process Loss in almost all cases except in one case. Based on the implementation of revised norms, there would be increase in prices of formulations varying from 0.55% to 1.2% in the case of Tablets, Capsules, Liquids and Ointments whereas in the case of Ampoules and Vials there may be reduction in price by 0.74% as per projections.

The existing norms PMC (Packing Material Cost) were last notified S.O. No. 936(E) dated 19.08.2004 by the NPPA. The Authority has also approved the proposal of revising the PMC norms for adoption in price fixation of formulation cases based on an exercise undertaken by the NPPA in line with the recommendations of NIPER on consumption norms submitted earlier. The norms relating to Tablets and Capsules packed in Aluminium Strips and Blisters remain more or less the same. An increase has been observed in respect of glass items upto 15% as per the revised norms. In this regard, the Authority has also noted that PMC is only one cost factor and the same is not applied in isolation. Therefore, the final prices of concerned formulations may not be increasing to that extent.

The Authority also considered and approved 38 cases of pricing of Insulin formulation imported in finished form.

The Gazette notification / Price Fixation Orders to implement the above decisions of the Authority are being issued separately.