The Cabinet had imposed a cap on prices of 348 essential medicines at the arithmetic average of prices all drugs in a particular segment with more than one per cent market share. Earlier, the GoM had recommended a price cap based on weighted average of all drugs, which would have reflected the price of expensive drugs with better market share more than those with a lower market share. The GoM’s suggested that any company changing the composition of the 348 essential medicines by adding a new ingredient to the formulation would come under price control and would have to seek permission from the pricing authority. Another recommendation of the GoM is that the price regulator would review prices of drugs periodically instead of five years.
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