The Telegraph
Since 1st March, 1999
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Price tag with tax on drugs

New Delhi, Feb. 11: From April 1, price labels of all medicines must carry the maximum retail price, having factored in all taxes, including the value-added tax, so that drug stores can’t overcharge customers.

Medicine packs will also have to carry the name, price and dates of manufacture and expiry in both Hindi and English. Most drug manufacturers now provide this information only in English.

“It will also be implemented from April 1 and by October 2, 2006, everybody has to comply. Necessary amendments would be made as and when required,” chemicals and fertilisers minister Ram Vilas Paswan said after the first meeting of the Pharmaceutical Advisory Forum, set up recently.

“Drugs' are unaffordable for the masses (and) will have to follow the MRP norm. Nobody should charge more than the MRP from April 1, 2006.”

Paswan said the state governments have promised not to levy any tax on cancer and HIV/AIDS drugs provided the Centre, too, does so.

He added that the government is considering a national scheme that provides for health insurance for poor families and ensures that life-saving drugs are available at reasonable prices.

“We are (also) assessing the options to provide free drugs to people below the poverty line and will talk to the ministries concerned for the funds required.”

The government will try to boost the state-run pharmaceutical units, Paswan said. He added that these public sector units’ share in the drug manufacturing business is a meagre Rs 250 crore. A target has been set to achieve a Rs 100,000-crore turnover by 2010.

He told reporters the National Pharmaceutical Pricing Authority and the state drug controllers will be strengthened so that they can monitor the drug price control order efficiently. “We need more manpower and teeth and necessary action in this regard would be taken.”

The day-long meeting was attended by health ministers and secretaries, drug controllers, officials from the Centre and the states, representatives of the drug industry and consumer groups.

The industry representatives demanded that the excise be brought down from 16 per cent to 8 per cent and the turnover limit of small-scale industries raised from Rs 1 crore to Rs 5 crore. Paswan said a proposal on slashing the excise had been sent to the finance ministry.

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