Parliamentary Committee has called the bluff, Centre has to act now
By R. Suryamurthy
By any meaningful measure, India should be the cheapest place on earth to fall sick. It is the world’s largest supplier of generic medicines, the factory floor for global pharma, the so-called “pharmacy of the Global South.” Yet for ordinary Indians, the lived experience is the opposite: a healthcare system where a simple fever syrup can cost six times its supply price, a gastric pill ten times, and a life-saving cancer drug nearly 80 percent less on an online platform than its printed “maximum retail price.” No one needs a doctorate in public policy to see what this is — it is a marketplace optimised not for affordability, not for access, but for extraction.
The latest report of the Standing Committee on Chemicals and Fertilizers is unsparing in its diagnosis — and still nowhere near harsh enough. The Committee painstakingly documents what patients have known for decades: that India’s drug-pricing regime is a permissive playground for pharmaceutical companies, especially the multinational giants whose branded generics dominate the very categories people rely on every day. The Committee calls the mark-ups “illogical,” “exorbitant,” and “against public interest.” That’s polite. The reality is uglier: the entire system is built on engineered price inflation, regulatory abdication, and a political establishment unwilling to confront an industry that has grown far too comfortable with impunity.
The numbers in the report are staggering. A common antihistamine tablet with an MRP of ₹21 is supplied to a stockist at ₹1.85 — a mark-up of 1,038 percent. A standard acid-reflux drug marked at ₹170 costs the distributor ₹13.95, a 1,119 percent jump. A widely prescribed calcium supplement carries the most damning spread of all: an MRP of ₹327 against a supply price of ₹16.95, translating to a margin of 1,831 percent. These aren’t occasional anomalies; they are the business model. The Committee found similar distortions across allergy, gastro, vitamin, cardiovascular and paediatric drugs — in other words, the heart of India’s medicine basket.
Multinational firms sit prominently in this space, and their pricing behaviour reflects a calculus freed from competitive discipline. Patients, after all, trust brands more than molecules. And trust is the motherlode of pricing power.
But the worst excesses appear in oncology — where the stakes are literally life and death. One cancer drug, with an MRP of ₹38,215, is sold online for ₹9,200. Another, listed at ₹45,000, retails for ₹8,800. No reputable pricing ecosystem in the world produces differences this extreme unless the original price is artificially inflated. The Committee, usually careful with its language, slips into honesty here: these MRPs have been “engineered to accommodate high trade margins.” When a patient is desperate, when families are selling assets or draining savings to keep someone alive, companies know they can mark up prices without consequence. And the government, fully aware of this pattern, looks away.
It is not as if India lacks the legal architecture to intervene. It has the NPPA, a price regulator; the Drugs (Prices Control) Order, a legal framework; and a declared national commitment to affordable medicines. What it does not have is courage. The DPCO regulates only the increase in price, not the base price itself. A manufacturer can launch a drug at ₹3,500 even if it costs ₹400 to make and distribute, and still comply with the law as long as it keeps the annual hike below 10 percent. This absurd loophole is the single biggest gift India has handed its pharmaceutical industry. It is a masterclass in regulatory design that protects optics, not people.
The NPPA, for all the verbal support it receives during press conferences, is a toothless watchdog. It cannot audit manufacturing costs. It cannot demand cost sheets. It cannot mandate disclosure of trade margins. It cannot regulate the launch price of any non-scheduled drug — a category that conveniently covers more than 85 percent of India’s pharmaceutical market. The regulator sits on a mountain of responsibility and a teaspoon of authority, which is precisely the way the system prefers it.
Meanwhile, the government touts Jan Aushadhi as proof of its commitment to affordability. It shouldn’t. Jan Aushadhi is not a triumph of policy but an indictment of it. When the same molecule sells in a government outlet for ₹12 that a multinational pushes at ₹170, or when a supplement sold at ₹40 in a public pharmacy is priced at ₹327 under a branded label, the conclusion is obvious: extreme MRPs are neither natural nor necessary. They are permitted.
Even in sectors where regulators did intervene — such as coronary stents — the victory was short-lived. After capping stent prices in 2017, the NPPA saved thousands of families from medical bankruptcy. But price creep began almost immediately. Drug-eluting stents, cut to ₹29,600 initially, now cost ₹38,267; bare-metal stents have risen from ₹7,260 to ₹10,509. Hospitals layer GST, procedural fees and “package charges” on top of these regulated prices, quietly restoring the very burden the law was meant to eliminate. When intervention becomes symbolic, profiteering becomes structural.
The real tragedy is the government’s paralysis on Trade Margin Rationalisation. When TMR was briefly applied to 42 cancer drugs, MRPs crashed by 50 percent. Patients saved nearly ₹984 crore in a single year. When TMR was applied to select medical devices during the pandemic, it saved another ₹1,000 crore. The evidence is overwhelming: rationalised margins reduce prices without collapsing the industry. And yet TMR has been stalled for five years, stuck in consultations heavily influenced by multinational manufacturers and their domestic allies. The Committee does not name this reality outright, but one doesn’t need a forensic auditor to follow the incentives.
Lobbying has consequences. Regulatory delay has a body count.
What the Committee hints at — and what must be said plainly — is that patients in India pay inflated MRPs because the political system has normalised the language of “balancing affordability with industry growth.” In practice, that balance tilts heavily towards corporate comfort. India is obsessed with becoming a global pharmaceutical powerhouse, but it cannot simultaneously be the world’s supplier and its own population’s protector if it refuses to confront the abuse of pricing power at home.
The contradiction is grotesque: India supplies low-cost generics to more than 200 countries, but its own citizens often pay far more for the same molecules. The country exports affordable medicines to Africa, Latin America and Southeast Asia while allowing domestic distributors and retailers to earn margins that would be considered unethical — if not illegal — in the very countries India markets itself to.
This is why the Committee’s recommendations matter. It wants NPPA empowered to regulate trade margins across all drugs, not just a handful. It wants mandatory disclosure of PTS and PTR values. It wants real-time monitoring of online drug sales, where the discounting of cancer medicines is so extreme that questions about authenticity, quality and supply-chain legitimacy become inevitable. It wants the government to resurrect and not merely reconsider a modern pharmaceutical policy. And most importantly, it wants a government willing to confront the industry instead of tiptoeing around it.
But recommendations, no matter how sharp, mean nothing without political will. India does not have a data deficit on drug pricing — it has a decision deficit. It has mountains of evidence that patients are being fleeced. It has proof that rationalised margins work. It has a regulator eager to do more. What it lacks is a government ready to challenge a sector that has mastered the art of influence, narrative and quiet pressure.
For a country that calls itself the pharmacy of the world, it is a national disgrace that so many Indians still ration essential medicines, cut pills in half, delay doctor visits, or abandon treatment altogether. It is a disgrace that cancer drugs are priced like luxury commodities. And it is a disgrace that extreme MRPs continue to exist because policymakers refuse to pick a side — the patient’s.
Every nation eventually decides whether healthcare is a right or a revenue stream. India has tried for too long to pretend it can be both. The Committee has finally called the bluff. Now it is up to the government to decide whether it will reform a broken pricing regime — or continue to protect an industry that has mistaken regulatory weakness for economic entitlement. If India truly wants to be the pharmacy of the world, it must first stop bankrupting its own people. (IPA Service)
