India To Cap Profit Margins On Drugs

Drug prices in India are expected to soon fall significantly with the central government planning to put a ceiling on the profit margins of retail pharmacies and wholesalers at 35%. The move, which follows recommendations of an expert committee constituted under the Department of Pharmaceuticals, is expected to benefit consumers. Pharmacies and wholesalers allegedly charge 400–500% margins on drugs that are already steeply priced. The government is attempting to restrict that percentage and ensure that vital drugs are available at affordable prices. Shobha Mishra Ghosh, senior director of the Federation of Indian Chambers of Commerce & Industry, India’s oldest business organization, says it is difficult to determine whether the move could impact imports of drugs into the country. Ghosh represented the federation on the expert committee.