Parliamentary panel asks government to review current drug price framework to curb high prices of essential medicines

Almost a year after it was flagged first, the parliamentary panel on Chemicals and Fertilizers reiterated its view that a wide range of frequently prescribed medicines used for common ailments and chronic conditions are being sold at high prices with unjustified trade margins, in India.

The panel, which wanted to government to take a comprehensive review of the current price regulation framework to plug the existing loopholes in the pricing mechanisms, said it finds the response of the Department of Pharmaceuticals inadequate. ‘It does not address the concerns of the Committee, specifically on the apparent lack of any control over trade margins in the case of non-scheduled drugs, leaving the door open for widespread profiteering’, the panel said in its comments on the Action Taken Reply submitted by the Department.

The Committee observed that approximately 82% of the pharmaceutical market comprises non-scheduled drugs and thus, around 70,000 SKUs (store keeping units) remain outside the ambit of direct price control. The Committee wanted the existing mechanism of monitoring only annual MRP increase up to 10% in respect of such non-scheduled drugs to be revisited to mitigate any adverse impact on patients, particularly in respect of chronic-care and life-saving medicines. It had also sought details of the non-scheduled drugs that are having the weighted average markup more than 100% of the price to distributor.

The Committee, in its original report in August, 2025, had also highlighted the inadequacy of the current Drugs Prices Control Order (DPCO), 2013 framework in curbing pricing malpractices in India’s pharmaceutical sector, regulatory gap which allowed manufacturers to launch non-scheduled formulations at arbitrary points, lack of transparency in Price to Stockist (PTS) data on platforms like Pharma Sahi Daam and Sugam App and exclusion of Fixed Dose Combinations (FDCs) from ambit of price regulation.

However, the Department of Pharmaceutical has been silent in its response to most of these issues, the Committee said.

The parliamentary panel also expressed concerns over the ‘inordinate delay in institutionalising the Trade Margin Rationalisation (TMR) framework. Stating that it is important to address the concerns of MSMEs and pharmaceutical manufacturers, the Committee said the objective of providing medicines at affordable prices for the common man, must remain paramount and should not suffer due to prolonged deliberations.

Committee recommended that the Department should look into the matter and take urgent action for price regulation of medicines falling under the category of ‘trade generics’ to safeguard the interests of patients in rural and remote areas.