Many small scale drug manufacturers are thinking about to stop manufacturing price controlled-drugs because of the high cost of operations and lower margins. DPCO (Drug Price Control Order) has fixed the prices of some drugs and they all come under Controlled-price drugs as per the Essential Commodities Act.
Himanshu Shah, President of MP Small Scale Drug Manufacturers Association said that it’s getting hard to manufacture price-controlled drugs as production costs go up and their prices are fixed with lowest margins and taking profits away. Price controlled drugs are like Ranitidine tab, Chloroquine tab and oral liquid, Betamethasone tab, Amoxicillin tab, and Cefixime tab have very low margins and manufactured by small scale regional drug manufacturers.
He also shared that production costs increased by 4 to 5% with a sharp rise in packaging materials, that made drug manufacturers unhappy with the outcomes.
As per market experts, sooner production of fixed price drugs will be limited that led to the shortage of these medicines in the market. As every manufacturer want to produce drugs with high-profit margins.
Amit Chawla, MP Small Scale Drug Manufacturers’ Association member told that with no hike price options for fixed price drugs, production becomes very difficult to continue. As when margins dry with no alternative to negate price rise, then producers will choose not to manufacture.
And if production costs keep on increasing, then the days are not far when the market experience the shortage of these drugs.
Industry officials told the media that there is a need to work on the quality of the medicines instead of restricting prices as with restrictions production and quality both may suffer.
Drug manufacturers already getting impacted even for exportable drugs as packaging material prices go high. Because of market competition, prices can’t be increased and profit margins going down.
Packaging material cost has risen up by 10% like aluminum blister foil and PVC and boards among others mostly used by pharmaceuticals.