Dated : 10th March, 2008

The National Pharmaceutical Pricing Authority has issued the Guideline 2/2008 dated 10.3.2008 in respect of Reduction in prices of non-scheduled formulations packs consequent to reduction in excise duty from 16% to 8% and the rate of abatement from 42.5% to 35.5% notified by Ministry of Finance (Department of Revenue) on 01.03.2008.

F. No.20(109)/2006-Div.III/NPPA

National Pharmaceutical Pricing Authority
Ministry of Chemicals & Fertilizers
Government of India
New Delhi

5th/3rd Floor, YMCA Cultural Center Building,
1, Jai Singh Road, New Delhi-110 001
Dated : 10th March, 2008

Guideline No. 2/2008

Sub. : Reduction in prices of non-scheduled formulations packs consequent to reduction in excise duty from 16% to 8% and the rate of abatement from 42.5% to 35.5% notified by Ministry of Finance (Department of Revenue) on 01.03.2008.

Consequent upon the reduction in the rate of Excise duty on medicines from 16% to 8% notified by the Ministry of Finance, Department of Revenue vide notification no. 4/2008-Central Excise dated 01.03.08 and the rate of abatement from 42.5% to 35.5% vide notification no. 14/2008-Central Excise (N.T.) dated 01.03.2008, all manufacturers and marketing companies of formulations packs are advised to ensure that the benefit of this excise duty reduction and the reduced rate of abatement is passed on to Consumers through reduced Maximum Retail Price (MRP). Prices of all non-scheduled packs must accordingly be reduced downwards by 4.58% except in those categories of non-scheduled formulation packs where no excise duty has been actually paid to the Government and therefore no excise duty shall be chargeable in the MRP of such non-scheduled packs. The National Pharmaceutical Pricing Authority (NPPA) expects that the above reduction in MRP would be complied with by way of reduced MRP and that necessary revised price lists would be submitted to NPPA forthwith.

2. NPPA shall accordingly monitor the limit of 10% increase in prices per annum of non-scheduled packs based on the reduced MRP for all such packs where the batch of the formulation pack has been cleared by the manufacturer through the competent excise authorities on or after 1st March, 2008 in terms of abovementioned notification of the Ministry of Finance (Department of Revenue) both dated 01.03.2008

(L. M. Kaushal)
Director (Monitoring)

Copy to:

1. IDMA/OPPI/IPA/CIPI (Small)/AIOCD for bringing the aforesaid to the notice of all their members.

2. PIO, Deptt. of C&PC for issuing a Press release for wide publicity in the Print and Electronic Media.

3. State Drug Controllers in all States.

4. Joint Secretary, D/o C&PC for information & necessary action.

(L. M. Kaushal)
Director (Monitoring)