How Effective Are the 2013 DPCO Regulations?

Abstract

In this chapter, we examine whether the 2013 DPCO has been successful in making essential medicines more affordable. Before we do so, it is useful to recall historical assessments of previous versions of the DPCO. Historical accounts indicate that the implementation of DPCO regulations in India has been ineffective. In the 1970s, the implementation of the recommendations of the Hathi Committee were delayed by 4 years. Although the committee established the importance of focusing price regulation based on the ‘essentiality’ of drugs rather than their prices, the recommendation was forgotten by 2002, leading to a fresh debate on the issue. In 1979, the control of drug prices led to a troubling shortage of essential drugs, causing hardships for patients (Basak 2008). The drafting of the drug policy was delayed in the 1980s due to opposition from industry associations (EPW 1985). In 1986, the pharmaceutical policy was still unclear about what drugs needed to be brought under price regulation, allowing industry associations to influence regulators on behalf of the pharmaceutical firms (Bal 1986a, b). In 1990, the industry and trade associations warned about a possible nationwide strike unless the implementation of price control was postponed (EPW 1990). Similarly, after the implementation of the 1995 price control regime, prices of essential medicines rose, which benefited pharmaceutical producers (Malhotra 2010; Rane 1996). Before we examine the effectiveness of the 2013 DPCO, we discuss the assessment by the NPPA as well as an assessment by the pharmaceutical industry lobby in collaboration with IMS.