The Ministry of Chemicals and Fertilizers, Department of Pharmaceuticals, provided detailed information on the regulation and rationalization of maximum retail prices of medicines in India. Drug prices are regulated under the Drugs (Prices Control) Order 2013 (DPCO, 2013), which is based on the principles of the National Pharmaceutical Pricing Policy, 2012 (NPPP, 2012). The National Pharmaceutical Pricing Authority (NPPA) fixes ceiling prices of formulations specified in Schedule-I to DPCO and the retail price of new drugs as defined under 2(1)(u) of DPCO 2013, based on market data and DPCO provisions.
Ceiling prices of scheduled drugs apply to all manufacturers, while retail prices fixed for new drugs apply specifically to applicant manufacturers and marketers. All entities must sell within the notified ceiling price or retail price plus applicable GST, though manufacturers are free to sell below these prices based on market dynamics. There is no restriction on manufacturers fixing different prices for the same schedule formulation under different brand names as long as they remain below NPPA-fixed ceiling prices.
For non-scheduled formulations, manufacturers can fix drug prices but cannot increase MRP by more than 10% during the preceding 12 months. This price regulation, combined with other government initiatives, has resulted in a significant decline in out-of-pocket expenditure share in Total Health Expenditure from 62.6% in 2014-15 to 43.4% in 2022-23.
NPPA monitors compliance with DPCO 2013 provisions and takes appropriate action against overcharging and other violations based on references from various sources including Price Monitoring and Resource Units in States, State Drugs Controllers, market samples, market database reports, and grievance redress channels. DPCO 2013 requires every manufacturer to print the maximum retail price on formulation labels, and no person is permitted to sell any formulation to consumers at a price exceeding the current price list or labeled price.
Additional measures to improve medicine access include: (i) Pradhan Mantri Bhartiya Janaushadhi Pariyojana providing quality generic medicines through over 20,000 Janaushadhi Kendras at 50-80% cheaper rates than branded medicines; (ii) Ayushman Bharat Pradhan Mantri Jan Arogya Yojana providing health insurance cover of ₹5 lakh per family per year for secondary/tertiary care hospitalization including medicines; (iii) Free Drugs Service Initiative making essential medicines available free of charge at public health facilities from PHCs to district hospitals; (iv) AMRIT initiative providing affordable medicines for cancer, cardiovascular diseases, implants, and surgical disposables at up to 50% discount through AMRIT Pharmacy stores; and (v) Financial assistance through Rashtriya Arogya Nidhi and Health Minister's Discretionary Grant for poor patients below poverty line suffering from life-threatening diseases including cancer.
This information was provided by Minister of State for Chemicals and Fertilizers, Smt. Anupriya Patel, in a written reply in the Rajya Sabha on August 11, 2026.