The Department of Pharmaceuticals (DoP) has issued an order disposing the review application of Bharat Serum and Vaccine (BSVL) to the National Pharmaceutical Pricing Authority (NPPA) instructing to verify the applicability of GST factor by cross-checking the documents submitted by BSVL pertaining to the formulation Human Normal Immunoglobulin. It has also asked to revise the ceiling price of the formulation if necessitated on the basis of verification on merit.
On April 15, 2020 the company made a review application under para 31 to the DPCO 2013 against NPPA’s order number 124 (E) dated April 3, 2020. Wherein, it mentioned that the NPPA has fixed and notified the ceiling price of formulation Human Normal Immunoglobulin (solution for infusion 16.5 per cent) at Rs 379.83 per ml and uploaded on the NPPA’s website on April 6, 2020. Although, the authority had fixed the ceiling price of the said formulation in its meeting on March 3, 2020 and as per the past practice followed by the NPPA, a period of 10 working days is given for calling of comments if any from the manufacturer. However, in this case (BSVL) comments were not taken before approving the price.
On this move, the company submitted its application expressing that the NPPA has erred in fixing the ceiling price of formulation ‘Human Normal Immunoglobulin’ 16.5 percent by applying reduction as per monopoly condition and also not taking correct data. BSVL has claimed that there are other manufacturers of the said formulations.
However, the DoP has not accepted all the issues raised by the company except for the applicability of GST for the said formulation and ordered the NPPA to revise the ceiling price after checking the applicability of GST for the formulation.
Bharat Serum and Vaccine’s contentions
In the issued order, Navdeep Rinwa, Joint Secretary, DoP highlighted the company’s contentions that “The Computation of Ceiling Prices has been done on the basis of data prevailing in August 2015. This is not correct and is against the provision of DPCO 2013. According to the Para 9 of the DPCO 2013 stipulates that the market-based data for fixing the ceiling prices of a scheduled formulation due to a revision in the first schedule shall be the data available for the month ending immediately before six month of August 2019 should have only been considered by the NPPA in the calculation of the ceiling price.”
The letter issued by the DoP goes on to state, “The company has been submitting data to the NPPA in the prescribed forms III and V since July 2016 on a regular basis. And this data should have been considered by the NPPA and the ceiling price should have been computed based on this data by giving an annual Wholesale Price Index (WPI) increase for the year 2019, which is with effect from April 1, 2020. And it is observed that the revised ceiling price has been arrived at by applying a GST factor of 0.95905. the said formulation is excisable with the NIL rate of excise duty. Accordingly, the multiplication factor should have been considered as ‘1’ instead of a factor of 0.9590. Hence, the ceiling price as arrived in the computation sheet needs to be revised post GST.”
It is further seen that ceiling price has been calculated under para 6 of the DPCO 2013by applying reduction as per monopoly condition. The company mentioned that there are other manufacturers also of this formulation and they are not the only manufacturer. As such calculation under Para 6 does not seem to be correct, and the company has been making efforts to get the details of other manufacture of this formulation from all source viz; Pharmatract etc. Considering the current situation of COVID-19 pandemic they have not been able to get the same immediately and it may take some more time.
Therefore, in view of the position stated above, the company has submitted that there is no justification for price fixation of Human Normal Immunoglobulin 16.5 per cent in the manner as adopted by the NPPA and thus this ceiling price notification needs to be withdrawn immediately and the NPPA ma...
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