Health technology assessment for pricing and reimbursement decisions According to an estimate published in 2007, it costs US$1.3 billion to bring a selleck chemicals Bosutinib new drug to market, and the cost of failure in drug development programs has forced prices to unprecedented high levels. There is a balance to be found between delivering innovation and affordable pricing, particularly in emerging markets such as India, where strengthening of mechanisms for intellectual property protection is a priority. The absence of patent protection for drugs in India, between 1972 and 2005, allowed companies to use alternative non-infringing processes to manufacture generic drugs. Thus, generic versions of many medicines are on sale in India at prices that are substantially lower than their branded equivalents in Western markets.
With continued upward pressure on pharmaceutical development costs, leading to higher prices for drugs in the developed world, agencies in many countries are using HTA methodology to control these trends. However, it is not only Western markets that are seeking new ways of checking the increase in prices of medicines. With the introduction of a new draft National Pharmaceutical Pricing Policy, which promises to extend the proportion of drugs subject to pricing controls from 20 to 60%, it is clear that India is moving toward a Western-style ??reference pricing?? approach. It is now proposed that 348 medicines will be included on the National List of Essential Medicines (NLEM).
The criteria for determining whether a drug will be included on the NLEM are as follows: Essentiality Drug_discovery of drugs: that is, those on the NLEM considered to satisfy the public health priorities of the Indian population Market-based pricing: the previous system involved a labor-intensive calculation of price, based on complex and variable cost data; market-based pricing uses publicly available data to ensure a simple, transparent process Control of formulation prices only: to ensure more specific price controls of the medicines used by the consumer/prescribed by the physician. Furthermore, there will be a fixed ceiling price, below which manufacturers can place their products, to retain competition in the market. The ceiling price will be calculated according to a formula based on the price and strength of the reference formulation, as given in the NLEM. Previously, drug price controls for the Indian market were based on the market share of individual products, defining a minimum profit margin selleck bio and featuring a cost-based pricing formula.