New pharma policy will reinstitute inspector raj: Ficci to PM

New Delhi, Jan 10 (UNI) Federation of Indian Chambers of Commerce and Industry (FICCI) today virulently opposed the new pharma policy which would increase the range of price controlled drugs from the current 74 to 260 saying it would reinstitute the inspector raj against the spirit of the times.

''Most disturbing is the fact that this policy will reinstitute the old industrial license raj by bringing in controls over production, distribution and supply even of those drugs which would not be under price control,'' said the chamber President Habil Khorakiwala in a letter to Prime Minister Manmohan Singh.

Through the policy, the government will be empowered to reduce the price of any drug from 30 to 60 per cent by bringing them under price control at any time in future.

This will be based on a cost plus mechanism, in contradiction to a Planning Commission Taskforce Report on Pharmaceutical industry, which recommended that the price regulation should be on the basis of ''essentiality'' of the drug and it should be applied only to formulations and not to upstream products, such as bulk drugs.

''No effort should be made to impose a uniform price and only a ceiling price should be indicated,'' Mr Khorakiwala demanded.

The ceiling price of essential drugs should normally not be based on cost of production but on readily monitorable market based benchmarks, he added.

The industry found these conclusions to be logical and a broad consensus emerged between the industry and policy makers.

''The new policy, we believe, also proposes 100 per cent monitoring of pharmaceutical products (beyond the 260 drugs under price control) by the government,'' he said adding these measures will result in a negative impact on the pharmaceutical industry and more importantly, on the consumers of the nation.

Mr Khorakiwala said the industry may be forced to curtail the production of drugs because of the unremunerative prices which will result in inaccessibility of medicines for many consumers.

''Needless to say that such a new policy will bring a major setback to the pharma industry in the domestic market and its dynamism and vibrancy will be put at risk,'' he said.

UNI