Medical reps accuse drug firms of overcharging

Pharma makers 'making a mockery' of price control, they say

Long accused of overcharging from unwary customers, drug firms are now facing opposition from the very people they use to market their products "" medical representatives.

The Federation of Medical and Sales Representatives' Associations of India (FMRAI), the only association of its kind in India that represents one-fourth of the 200,000 medical representatives on the industry's rolls, has alleged that pharmaceutical producers are making a mockery of the government's price control initiatives by increasing the prices of medicines at will.

In a note to leading Parliamentarians, it has said that companies charge retail prices that in some cases are over hundred times more than the government-mandated price.

Amitava Guha, joint general secretary of the association, said there were several essential or popular medicines for which prices have increased even up to 600 per cent over the last nine years.

"Even medicines for tuberculosis therapy showed a price increase of more than 500 per cent," he said.

The National Pharmaceutical Pricing Authority had recently found that the prices of 15 top-selling medicines that were taken out of direct price control 12 years ago increased 9.65 per cent a year, against a one per cent rise for medicine that continued under price control.

The FMRAI data suggest that the situation could be much more serious than the government findings.

The industry has long contested the charges of over-pricing and had recently announced that it would cut some prices voluntarily.

Terming the voluntary price reduction a "great hoax", the FMRAI has said that the rot runs deep and even large companies have flouted the pricing norms fixed by the government.

It has said that while a company cut the price of one brand of a medicine, it continued to overcharge on other brands of the same medicine.

The FMRAI has also said that the government has been unable to recover the "overcharged" amount from companies in any significant way.

Official statistics indicate that the National Pharmaceutical Pricing Authority was able to recover only Rs 100.43 crore till July 31, 2007 of the total recovery notices for Rs 1,427.37 crore issued over the past 10 years "" just 7 per cent.

The government and the companies say that the non-recovery is primarily due to the litigation attached to these recovery notices.

The Authority is known to be handling 75 court cases filed by pharmaceutical companies against the government in various parts of the country on this issue.