India caps trade margins on 137 cancer drugs to cut costs
The move follows a Supreme Court ruling that called hospital mark-ups extortionate, a decision prompted by a former bank clerk who could not afford her treatment.
By Isabella Morales ·
New price controls on 137 cancer medicines take effect in November, a direct response to a Supreme Court order that labeled hospital mark-ups as "extortion."
The legal action originated with Sarojam Radhakrishnan, a former bank clerk in Kerala. In 2021, she was diagnosed with breast cancer and prescribed targeted treatments that cost more than 63,000 rupees per month. Her family could not sustain that expense. In 2022, she petitioned the Kerala high court to intervene. The case eventually reached the nation's highest court.
Justices Vikram Nath and Sandeep Mehta reviewed the pricing structure during a September 29 hearing. They noted that a specific drug supplied to hospitals for 2,700 rupees was sold for 27,000 rupees. The court described the margin structure as "carnage." The National Pharmaceutical Pricing Authority found that trade mark-ups on these drugs averaged 170%, with some instances exceeding 700%.
The government previously applied a 30% cap on trade margins to 42 specific drugs. The new order extends that cap to 137 additional medicines. The Department of Pharmaceuticals stated the measure is expected to lower medicine prices by up to 70%. It projects that patients will save 2,500 crore rupees annually.
The financial strain of cancer treatment in India is substantial. A former council member of the Rajiv Gandhi Cancer Institute, Krishan Kalra, noted that many people avoid free diagnosis camps because they fear the cost of treatment. Cancer drugs currently range from 38,000 to 380,000 rupees. The Public Health Foundation of India reports that healthcare spending pushes approximately 55 million people below the poverty line each year.
Existing insurance schemes offer limited protection. The Ayushman Bharat program provides 500,000 rupees in annual coverage per family. That amount equals the cost of a single dose of Kadcyla, a breast cancer drug that patients may require up to 14 times. Dr. Ravi Kannan, a surgical oncologist in Assam, described the decision as a welcome step for patient access.
India records about 1.56 million new cancer cases annually, an increase from 1.39 million in 2020. Jyotsna Singh, a co-convener of the Working Group on Access to Medicines, warned that hospitals might offset lower drug costs by raising other charges. The Supreme Court has asked the government to explain why the cap does not apply to all non-patented medicines. The government has until October 27 to respond. Radhakrishnan died in September 2022 while her case was pending.
Source: The Guardian
