Tuesday's drug price decontrol decision has apparently been more of a political move than a policy announcement. While the pharmaceutical policy has been in the pipeline for almost two years, sources say the Cabinet approved it despite objections raised by the finance ministry.
A more complete policy announcement is expected on Monday, while the specific fiscal incentives to be given to Indian pharmaceutical companies for research and development will be announced in the Budget. The finance ministry was in favour of announcing the entire roadmap at one-go.
The announcement said there would be incentives without spelling out the details as it would have put pressure on the ministry from different sources with the Budget just round the corner. The Cabinet yesterday approved the criteria on the basis of which drugs would be brought under price control, a decision which will sharply reduce the number of bulk drugs under price control and the span of price control in the formulations market.
Most Indian pharma companies are expected to benefit from the policy announcement.
