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While launching new products in the market or fixing their retail price, pharmaceutical companies might soon be required to submit product details and documentations online to the drug price regulator. In line with the government's e-governance mantra, the National Pharmaceutical Pricing Authority (NPPA) is also set to go online, mandating companies to apply online while seeking price approvals or launching new drugs in the market, a senior official said.
The authority is in active discussion with National Informatics Centre (NIC) to create a comprehensive online system which would enable workflow automation while facilitating interface with the industry.
"We are in dialogue with top officials of NIC and have asked them to complete the project on a fast track basis. We are planning to introduce the first module within three months and the full form in around six months," NPPA Chairman Injeti Srinivas said. He added, once the system was in place, companies would be mandated to provide online, all information related to the amount of production, cost of production, trade prices as well as details related to different brands of a particular formulation. Under the new system, firms would have to report all such details in a set format every quarter. This would include information related to both, price-controlled products as well as for those that are outside the purview of direct government regulation, Srinivas said. In the first of its kind data management system for the drug manufacturing industry, the regulator will also create security layers to protect confidential data given by firms.
The move is significant because so far, there has been a severe dearth of data with the government to regulate the country's drug manufacturing industry. Even in case of clinical trials, the Supreme Court has repeatedly thrashed the government and regulator for a lack of data to monitor the industry.
Of late, a big contention between the price regulator and the drug manufacturing industry has been about the data based on which prices are fixed. So far, the NPPA has fixed prices of medicines based on data generated by IMS Health, a private market research organisation. Whereas, the industry has often raised concerns saying the data generated by IMS is not credible for price fixation and misguides the regulator. Therefore, in the absence of a government machinery to collect data for medicines, the regulator decided to source data from the industry itself. "The online system will enable us to secure all data from the industry itself and once there is a comprehensive database, the fear of price fixation with suboptimal data is addressed," Srinivas said.
The new system will also contain data with regard to year-on-year price increase of each formulation and of specific brands. This would also enable the regulator to detect overcharging automatically.
Besides, the online system will have details related to production of companies with respect to their location etc.
Companies will also be required to self-declare all such information through digital signature, so that the regulator can punish them in case of any deviation or violation, Srinivas said.
Currently, the government directly caps prices of 348 essential medicines, whereas companies are free to fix prices of all other medicines and increase them annually by up to 10 per cent.
Srinivas, an IAS officer from the 1983 Odisha cadre who took charge at NPPA earlier in June, says, technology and e-governance if used properly can do "miracles". "Everything is going online now because it brings in efficiency, transparency and accountability. Medicines are not ordinary products and this sector is suffering because of a lack of database. A comprehensive online system can solve the problem of database," he said.
