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New Delhi, October 17: In a major intervention aimed at reducing the financial burden of cancer treatment, the National Pharmaceutical Pricing Authority (NPPA) has capped the trade margin at 30% for 137 non-scheduled anti-cancer drugs and directed manufacturers to recalculate their Maximum Retail Prices on the basis of the price at the first point of sale. The revised prices will come into effect from November 9, 2026.
The order, issued by the Department of Pharmaceuticals under the Ministry of Chemicals and Fertilizers and published in the Gazette of India on October 17, invokes the extraordinary powers available under Paragraph 19 of the Drugs (Prices Control) Order, 2013.
The intervention covers 137 non-scheduled anti-cancer medicines recommended by an expert committee constituted under the Directorate General of Health Services. NPPA has also decided that patented medicines will fall within the scope of the order unless they have been specifically granted an exemption under Paragraph 32 of the DPCO, 2013.
The government said cancer treatment imposes a severe financial burden on patients and their families and can lead to catastrophic health expenditure. Concerns had been raised by state authorities, patients, civil society and public platforms about high prices of anti-cancer medicines, particularly the wide difference between procurement prices and the Maximum Retail Prices charged to patients.
According to the order, excessive trade margins on high-value oncology medicines substantially increase patients’ expenditure. For the purpose of the intervention, the trade margin has been defined as the difference between the price at which a manufacturer sells a formulation to a stockist or distributor and the MRP charged to the patient, excluding GST.
The National List of Essential Medicines, 2022 contains 388 medicines, including 63 anti-cancer medicines already subject to price control under the DPCO. The latest order targets an additional group of 137 non-scheduled anti-cancer medicines where market analysis indicated significantly high trade mark-ups in some cases.
The government noted that there were also differences between prices charged through retail channels and hospitals, including varying discounts on MRP, indicating that the printed MRP and actual transaction price could differ considerably.
Under the new mechanism, manufacturers must calculate the MRP using the Price to Stockist or Price to Distributor, known as PTS/PTD, with the permissible trade margin capped at 30%.
For medicines that were being sold in March 2026, the PTS/PTD for that month will form the basis for the calculation.
Where there were no sales during March 2026, the average PTS/PTD will be calculated from sales between April 2025 and March 2026. Government sales will be excluded while calculating this base price.
For a drug launched after March 31, 2026, the current PTS/PTD will be used for determining the permissible MRP.
The Gazette order provides a striking illustration of how the mechanism could affect prices. In its example, a non-scheduled anti-cancer formulation carrying a current MRP of ₹300 plus applicable GST and having a PTS/PTD of ₹70 would have a maximum permissible revised MRP of ₹100 plus applicable GST under the 30% trade-margin formula.
Manufacturers whose existing MRP is above the price calculated under the new formula will have to reduce it accordingly. However, manufacturers already selling below the newly calculated permissible MRP will have to retain their existing lower price and cannot raise it merely to reach the new ceiling.
The order applies to non-scheduled formulations containing any of the 137 specified drugs, whether used individually or in combination and irrespective of strength, dosage form or route of administration.
The listed medicines include several widely used and high-value oncology therapies such as Abemaciclib, Abiraterone acetate, Acalabrutinib, Atezolizumab, Bevacizumab, Cetuximab, Daratumumab, Durvalumab, Enzalutamide, Ibrutinib, Nivolumab, Olaparib, Osimertinib, Palbociclib, Pembrolizumab, Pertuzumab, Ribociclib, Sunitinib, Venetoclax and Zanubrutinib, among others.
The list also includes medicines used in combination therapies, and the order makes clear that its pricing mechanism will apply even where a formulation containing one of the listed drugs is being used for another therapeutic purpose.
NPPA had earlier undertaken a Trade Margin Rationalisation intervention in 2019 on a pilot basis covering 42 non-scheduled anti-cancer medicines. According to the new order, that intervention resulted in substantial savings.
The latest exercise follows deliberations at NPPA meetings held on October 8 and again on October 16 and 17, where the authority concluded that extraordinary circumstances existed to address market distortions, curb profiteering and ensure fair and affordable prices.
Manufacturers have been directed to provide prescribed information on all covered non-scheduled formulations to NPPA within seven days of publication of the order, regardless of whether the MRP of a particular product changes.
They must also submit revised price information to NPPA and the concerned State Drug Controller within seven days. Failure to submit the required information will be treated as non-reduction of MRP and can trigger proceedings to recover the amount considered to have been overcharged under the DPCO.
Manufacturers will also have to issue revised price lists through NPPA’s Integrated Pharmaceutical Database Management System and provide copies to State Drug Controllers, dealers and other required entities.
Retailers, dealers, hospitals and institutions are required to display the price lists and supplementary price lists supplied by manufacturers at a prominent location accessible to consumers.
Manufacturers must also circulate revised MRP lists to dealers and retailers, publish advertisements in leading newspapers informing dealers, retailers and consumers about the price reduction, and create a dedicated section on their company websites dealing with DPCO matters and revised MRPs.
They may additionally be required to provide batch-wise production details and the stock position of affected formulations held by the company and its distributors when the order was published.
Hospitals and medical institutions have been specifically brought into the compliance mechanism because a substantial quantity of anti-cancer medicines is supplied directly to them.
Where a manufacturer supplies a formulation directly to a hospital or medical institution, that hospital or institution will be treated as the stockist or distributor for the purpose of calculating the permissible MRP.
Hospitals and medical institutions must monitor MRPs under the new order, ensure compliance and prominently display revised prices on their websites. Any violation has to be reported to NPPA.
State Drug Controllers will also monitor compliance by manufacturers, dealers, hospitals and medical institutions.
The order further requires manufacturers to maintain their existing production levels. Any company seeking to reduce average monthly production must obtain prior approval from NPPA.
A manufacturer intending to discontinue production or import of a covered formulation must notify NPPA at least six months before the proposed discontinuation date.
Medicines supplied free of cost under qualifying Patient Assistance Programmes may be excluded from the PTS/PTD and MRP calculations, subject to prescribed conditions, record-keeping requirements and undertakings by manufacturers.
NPPA retains the right to seek additional information, conduct audits and inspections and independently verify implementation of such Patient Assistance Programmes.
The prices fixed under the order will remain applicable until further orders. Manufacturers may avail annual price increases allowed under Paragraph 20(1) of the DPCO, but only while continuing to comply with the maximum permissible trade margin.
Manufacturers violating the order can be required to deposit the amount overcharged along with applicable interest under the Drugs (Prices Control) Order, 2013 read with the Essential Commodities Act, 1955.
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