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AKUMS DRUGS & PHARMACEUTICALS LTD. D. C . JAIN dcj@akums.net 9811056056. WHAT IS COVERED UNDER DPCO - 2013. Covered under DPCO. 1. SCHEDULED DRUGS : Strength & Dosage Forms of 348 drugs in Schedule 1 Those selling at higher MRP shall bring down their MRP as notified by NPPA.

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slide1

AKUMS DRUGS & PHARMACEUTICALS LTD.

D. C . JAIN

dcj@akums.net

9811056056

slide3

Covered under DPCO

1. SCHEDULED DRUGS : Strength & Dosage Forms of 348 drugs in Schedule 1

Those selling at higher MRP shall bring down

their MRP as notified by NPPA.

Those selling at lower MRP shall not increase

their MRP as per notified price; but will

Continue to sell at their existing price.

slide4

Covered under DPCO

2. NEW DRUGS as defined under 2(u) ; Applicable to Existing Manufacturers for launch of New Drug and will require price approval.

3. IMPORTED DRUGS:

ceiling price shall be as applicable on indigenous drugs

slide5

Covered under DPCO

4. Monitoring of MRP of NON – SCHEDULED DRUGS (only 10% price increase per Annum allowed)

5. Control over BULK DRUGS MANUFACTURER

For bulk drug availability in case of emergency, urgency, non-commercial use, public interest.

6. Control over FORMULATION MANUFACTURER Directing for supply of formulations to sell to institutions, hospitals or agencies.

slide6

Covered under DPCO

7. Control over FORMULATION MANUFACTURER

Directing not to stop manufacturing or reduce manufacturing of required

quantities of formulation covered under NLEM.

slide7

Covered under DPCO

8. Pricing of formulations covered under DPCO 1995 - shall remain valid upto 31.05.2013 or 1 year from date of issue and thereafter prices can be increased as per annual whole sale price index for previous calendar year (2012) and thereafter formula as per para 4(1) shall be applied.

slide8

Covered under DPCO

10. Profit margin to retailers fixed 16% on retail price on scheduled formulations and New Drugs.

11. Ceiling Price / Retail Price will be notified on the basis of dosage unit – Per Tab / Per Cap / Per Vial.

12. Deposit of over charged amount with interest and penalty.

13. Power of entry, search and seizure by any Gazetted officer.

slide10

NOT Covered under DPCO

1. Ayurvedic, Siddha, Unani Medicines.

2. Homoeopathic Medicines.

3. Any Substance not covered under Drugs & Cosmetics Act.

4. Non-Scheduled Drugs.

5. Non-Scheduled Drug combined with non- schedule drug.

slide11

NOT Covered under DPCO

6. Non-Scheduled Drugs – when combined with a Schedule Drug with different strength.

7. Non-Scheduled Drugs – when combined with a Schedule Drug with different dosage form.

8. New Drugs Manufactured by a New Manufacturer, New Drug already being manufactured by an existing Manufacturer.

slide12

NOT Covered under DPCO

9. A formulation defined as New Drug involving NDDS under rule 122E of D&C Act and for which DCGI has granted its approval for five years from the date of its approval.

10. Patented Drug (Product Patent or process patent or new drug delivery system) for five Years.

slide13

NOT Covered under DPCO

11. All innovations in dosage as SR, ER, etc., unless already specified in Schedule; a separate manufacturing licence has been granted as such.

slide14

WHAT IS

SCHEDULED DRUG / FORMULATIONS

slide15

Scheduled Drugs

“Scheduled Drug/Formulation”

consisting of 348 drugs / 652 formulations Under 27 therapeutics

mentioned in First Schedule appended to DPCO 2013

With same strength and

With same dosage forms,

Whether referred to by generic version or

By brand name.

slide16

Scheduled Drugs

As per NPPA clarification

Paracetamol Syrup and Paracetamol Suspension

are same DOSGAE FORMS

And therefore same ceiling price is applicable

slide17

Scheduled Drugs

2. If Strength of a scheduled formulation is changed, it ceases to be a Scheduled drugs e.g. –

Amoxicillincapsules 250mg and 500mg are covered under schedule:

Amoxicillincapsules 125mgshall not be called a Scheduled Drug

slide18

Scheduled Drugs

3. If Dosage Form of a scheduled formulation is changed, it ceases to be a Scheduled Drugs e.g. ---

AmoxicillinCapsules 250mg is covered under schedule:

AmoxicillinTablet 250mg shall not be called a Scheduled Drug

slide19

Scheduled Drugs

4. If Dosage Form & Strength of a scheduled formulation are changed, it ceases to be a Scheduled Drugs e.g. ---

AmoxicillinCapsules 250mg is covered under schedule

AmoxicillinTablet 125mg shall not be called a Scheduled Drug

slide20

Scheduled Drugs

5. Scheduled Drug shall mean Formulation with

Same strength and

Same dosage form as in the schedule and nothing else.

slide21

WHAT IS

NON-SCHEDULED DRUG / FORMULATIONS

slide22

Non - Scheduled Drugs

1. What is not a Scheduled Drug is a NON- SCHEDULED DRUG

2. Under para 2(v), “Non-Scheduled Formulation” means a formulation, containing the molecule, the dosage and strengths of which are not specified in the First Schedule; (Non-NLEM Drug / Formulation) For Example: Aceclofenac, Nimusulide, Sildenafil Citrate, Norfloxocin, Rabeprazole

slide24

New Drug / New Formulation

Under para 2(u) of DPCO 2013, New Drug has been defined as under:

“New Drug” for the purposes of this Order shall mean a formulation launched by an Existing manufacturer of a drug of specified dosages and strengths as listed in the National List of Essential Medicines (NLEM Formulation) by combining the drug with another drug either listed or not listed in the National List of Essential Medicines or a formulation launched by changing the strength or dosages or both of the same drug of specified dosages and strengths as listed in the NLEM List.

slide25

New Drug / New Formulation

concept is applicable to

“Existing Manufacturer” and

Not to a “New Manufacturer”

Concept is applicable at the launch of new drug and

Not for existing formulations under production, even if covered under the definition of New Drug.

slide26

New Drug

New Drug / New Formulation, in simple words covers -

a. NLEM Formulations with same specified

dosage and strength as combined with another NLEM Formulations with same specified dosage and strength.

slide27

New Drug

Example 1: Paracetamol 500mg Tablet

is Scheduled Formulation

Diclofenac 50mg Tablet

is Scheduled FormulationParacetamol 500mg + Diclofenac 50mg Tablet

is New Drug/Formulation

slide28

New Drug

Example 2: Omaprazole 20mg Tablet

is Scheduled DrugDomperadone 10mg Tablet

is Scheduled DrugOmaprazole 20mg + Domperadone 10mg Tablet is New Drug

slide29

New Drug

Example 3: Cefixime 100mg Tablet

is Scheduled DrugOfloxacin 100mg Tablet

is Scheduled Drug

Cefixime 100mg + Ofloxacin 100mg Tablet

is New Drug

slide30

New Drug

Example 4: Vitamin A 5000IU Capsule

is Scheduled Formulation.

Vitamin D 0.25mg Capsule

is Scheduled Formulation.

Vitamin A 5000IU + Vitamin D 0.25mg Capsule

is New Drug.

slide31

New Drug

b. NLEM Formulations with same specified dosage and strength as combined with another

Non - NLEM Formulations

slide32

New Drug

Example 1: Paracetamol 500mg Tablet

is Scheduled FormulationAceclofenac 100mg Tablet

is Non - Scheduled FormulationParacetamol 500mg + Aceclofenac 100mg Tablet is New Drug

slide33

New Drug

Example 2: Diclofenac Sodium 50mg Tablet

is a Scheduled Formulation

Serratiopeptidase 10mg Tablet

is Non-Scheduled Drugs

Diclofenac Sodium 50mg + Serratiopeptidase 10mg Tablet is New Drug

slide34

New Drug

Example 3: Clopidogrel 75 mg Tablet

is a Scheduled FormulationAspirin75 mg

is Non-Scheduled Drugs

Clopidogrel 75 mg + Aspirin 75 mg Tablet

is New Drug

slide35

New Drug

c. NLEM Formulations by changing its strength Example 1:Paracetamole 500mg Tablet is a Scheduled DrugParacetamole 325mg Tablet is a New Drug

Example 2: Clopidogrel 75 mg Tablet is a Scheduled DrugClopidogrel 150 mg Tablet is a New Drug

slide36

New Drug

d. NLEM Formulations by changing its dosage form --

Example 1:Diclofenac 50mg Tablet is a Scheduled Drug.Diclofenac 50mg Ointment is a New Drug.

Example 2:Clopidogrel 75 mg Tablet is a Scheduled Drug.Clopidogrel 75 mg Capsule is a New Drug.

slide37

New Drug

e. NLEM Formulations by changing its strength and dosage form

Example 1:Diclofenac 50mg Tablet is a Scheduled Drug.

Diclofenac 30mg Ointment is a New Drug.

(Strength and Dosage Form Both Changed)

slide38

New Drug

Example 2: Tramadol 50 mg / ml Injection is a Scheduled Drug.

Tramadol 37.5 mg tablets is a New Drug(Strength and Dosage Form Both Changed)However if New Drug using NDDS and has approval from DCGI then DPCO is not applicable for 5 years.

slide39

New Drug

Example 3:Metformin Tab 500mg is a Schedule DrugMetformin Tab 500mg SR is a New Drug

and will be exempted under DPCO for 5 yrs after DCGI approval.

slide40

New Drug

Example 4:

Tramadol SR or ER Tab

Paracetamol SR or ER Tab

Are not covered under DPCO

slide41

WHAT IS NOT

A NEW DRUG

slide42

Not a New Drug

Example 1:Paracetamole 500mg is Scheduled DrugAceclofenac 100mg is not Scheduled DrugParacetamole 325mg + Aceclofenac 100mg is not Scheduled Drug and is not a

New Drug under DPCO for price approval

slide43

Not a New Drug

Example 2:Paracetamole 500mg is Scheduled DrugNimusulide 100mg is not Scheduled DrugParacetamole 325mg + Nimusulide 100mg is not Scheduled Drug and is not a New Drug

under DPCO for price approval

slide45

WHO IS EXISTING MANUFACTURER?

Under Para 2 (g) of DPCO 2013, “Existing Manufacturer” means Manufacturer Existing on the Date of Publication of DPCO 2013 in the official gazette.

slide46

Manufacturer

Under para 2(o) Drug Price Control order 2013 Manufacturer has been defined as under: “Manufacturer” for the purpose of this order means any person who manufactures, imports and markets drugs for distribution or sale in the country.

slide47

Manufacturer

For the purpose of DPCO, following persons shall be manufacturers in India:

i) A manufacturer, who himself markets drugs for distribution or sale

ii) An Importer, who markets drugs for distribution or sale

iii) A marketer who markets drugs for distribution or sale after getting drugs mfd. By a contract manufacture.

slide48

Manufacturer

A Contract Manufacturer who is not a marketer, is not manufacturer under DPCO 2013.

slide50

1. PRICE TO RETAILER

Price to Retailer mean price of a drug at which it is sold to a retailer which includes duties and does not include local taxes.

Price to Retailer is retail price fixed by Govt. As divided by 1.16 or say 86.2069% of Retail Price.

slide51

2. CEILING PRICE

Ceiling Price means price fixed by Govt.Under DPCO.

Ceiling Price shall include Retailers Markup / profit margin of 16% over purchase price of retailer

slide52

3. MAXIMUM RETAIL PRICE

Maximum Retail Price means ceiling price or retail price + local taxes & duties as applicable at which drug shall be sold to the ultimate consumer and where such price is mentioned on the pack.

slide54

CALCULATION OF PRICE

Discussion of DPCO Price Fixationwasconfinedto NLEM Formulationswithspecifieddosage and specifiedstrengthonly.

Now a parallel DPCO has beencreatedtocover new drugs, fortakingpriceapproval in case of new launchbyanexistingmanufacturer.

slide55

Calculation of Ceiling Price of a Scheduled Formulation

a. Average Price to Retailer P(s)

(Sum of prices to retailer of all the brands and generic versions of the medicine having market share more than or equal to one percent of the total market turnover on the basis of moving annual turnover of that medicine) / (Total number of such brands and generic versions of the medicine)

slide56

For working out the average price, all marketed brands of a company having market share more than 1% taken considered together – Alembic case

slide57

Calculation of Ceiling Price of a Scheduled Formulation

b. It must be noted that Govt. has not taken Retail Price Base, but has taken Price to Retailer Base, which would mean that average MRP would come down.

c. Retailers would get a markup of 16% on their purchase price and they will not get 16% on Retail Price.

slide58

Calculation of Ceiling Price of a Scheduled Imported Formulation

Ceiling Prices are calculated and notified by Govt. as per formula above shall also be applicable to Scheduled Imported Formulations

slide59

Calculation of retail price of a new drug for existing manufacturers of scheduled formulations:-

If such new drug is available in domestic market, the retail price shall be calculated in the same manner i.e. as per Scheduled Formulations.

slide60

Calculation of retail price of a new drug for existing manufacturers of scheduled formulations:-

If such new drugs are not available in domestic market, the price to retailer shall be fixed based on principals of Pharmacoeconomics by Govt. on the recommendation of standing committee of experts. 16% margin of retailer shall be added thereon for the purpose of fixing retail price.

slide61

Calculation of Ceiling price of a scheduled formulation in case of no reduction in price due to absence of competition

Ceiling Prices in such case shall be fixed as per para 6 of the order

slide62

Calculation of ceiling price by existing manufacturer selling the products at a price lower than the ceiling price + taxes

Under rule 13(2) such manufacturers shall maintain their existing maximum retail price

slide63

Calculation of Ceiling Price of Drugs Covered Under DPCO 1995

Formulations covered in Schedule –I of DPCO 2013 and also under DPCO 1995, prices of which were fixed up to 31.05.2012; such prices shall be applicable up to 31.05.2013. Thereafter i.e. from 01.06.2013 such prices will be increased in tandem with whole sale price Index of previous calendar year i.e. 2012.

slide64

Calculation of Ceiling Price of Drugs Covered Under DPCO 1995

Formulations covered in Schedule –I of DPCO 2013 and also under DPCO 1995, prices of which were fixed after 31.05.2012; such prices shall remain applicable for 1 year from the date of such notification(s). Thereafter these prices will be increased from respective dates in tandem with whole sale price Index of previous calendar year.

slide65

Calculation of Ceiling Price of Drugs Covered Under DPCO 1995

Formulations not covered in Schedule –I of DPCO 2013, but covered under DPCO 1995, prices of which were fixed up to 31.05.2012; such prices shall remain applicable up to 31.05.2013. Thereafter i.e. from 01.06.2013; such formulations will because Non-Schedule Drugs and prices can be increased by 10%.

slide66

Calculation of Ceiling Price of Drugs Covered Under DPCO 1995

Formulations not covered in Schedule –I of DPCO 2013, but covered under DPCO 1995, prices of which were fixed after 31.05.2012; such prices shall remain applicable for 1 year from the date of such notification; and thereafter such formulations will become NSD and prices can be increased by 10% from the respective dates.

slide68

1. Calculation of Retail Price of a Pack

(Rule 11)

Average Price to retailer shall be calculated on the dosage bases i.e. per tablet, per capsule, per injection or per ml in volume as listed in first schedule.

2. Therefore, bigger the pack, more will be the gain.

slide69

3. Who has to maintain records for inspection under DPCO

Manufacturer – YES

Retailers / Wholesalers - NO

slide70

4. Power of Search & Seizer

  • Powers to be sparing used
  • But any place; by any authorised person

How much overcharging is possible for formulations produced before New Price notifications

To the extent seized and not what was produced

slide71

5. Govt. Power under DPCO

  • PowergiventoGazettedOfficers of Central & StateGovernmenttoenter and seizedrugs.
  • Overcharging + Interest + Penaltiesprovided. Earlierpenaltieswerenotthere.
  • Controlledpricewillberevisedeveryfiveyearsorwhen NLEM isupdatedorrevisedorwhenthereis a significantchange in marketstructure.
slide72

6. Power of drug inspectors

If Drugs Inspectors are given power as Gazetted officers under DPCO –

Concerned D.I. can inspect the records of manufacturer and not of Retailer

slide73

7. Quantum of current overcharging

Presently overcharging + Interest + Penalty are recoverable

  • From Manufacturer
  • Only on stocks held and sold by manufacturer only
slide74

Applicability of New Drug price approval is for Existing Manufacturer only.

  • There is no applicability of price approval of ‘New Drug’ by new manufacturer.
slide75

9. DPCO going beyond its scope

It is observed that under Section 12.3 Anti-hypertensive Medicines against Atnelol 50mg tablet is only specified but in the Schedule 1 under DPCO, 2013 both 50mg and 100mg tablets are specified. 100mg tablet as such be omitted from Schedule 1 of DPCO, 2013 as there was no mandate to include it.

There may be other such examples; which requires further examination.

slide76

New Drug

Vide S.O 2534 (E)

Fixed the price of Cefexime 100 + Ofloxacin Tablet Rs 5.73 per tab

While combination is not a Scheduled Drug. Ceiling Price Fixed for Cefexime 100 mg is Rs.7.69 per tab and Ofloxacin 100 mg is Rs. 3.30

slide78

PRICE REVISIONS

i) In case of Scheduled Drugs and New Drugs – Increase or Decrease is allowed as per whole sale price index of previous calendar year and such increase shall be applicable from 1st April each year. Govt. will issue such ceiling price also.

slide79

PRICE REVISIONS

ii) In case of Non-Scheduled drugs – upto 10% increase every 12 calendar months is allowed.iii) In case of Scheduled Drugs so being sold by existing manufacturers at a price lower than the ceiling price fixed, increase in the existing price shall be allowed annually as per whole sale price index.

slide87

D.C. JAIN

AKUMS DRUGS & PHARMACEUTICALS LTD.