NPPA Forms Guidelines To Restrict Marketers Changing Manufacturers After Retail Price Of Formulations Approved

New Delhi : The drug price regulator has formulated guidelines to handle applications from the marketers seeking change in manufacturer for the formulations for which retail price has already been notified and product launched in the market, in future. The step has been taken to reduce the increasing instances of companies changing the manufacturers with or without informing the authority.

The National Pharmaceutical Pricing Authority (NPPA) has decided that all future cases of change of manufacturer shall be examined on a case-to-case basis based on five parameters and only if the particular case falls within the ambit of these parameters the change may be permitted.

The change of manufacturer may be allowed if there is cancellation or seizure of license of the manufacturing company; natural calamity or civil riots leading to destruction of plant of manufacturing company; dissolution or winding up of the manufacturing company; closure of the concerned business segment by the manufacturing company, etc; or any other circumstance(s) proved to be beyond the control of manufacturer or marketer.

“The onus to prove the above conditions requesting for change of manufacturer will be on the applicant company with documentary evidence. The requests will be examined on a case-to-case basis and the earlier cases may not be treated as a precedent for future cases,” said NPPA.

The pricing authority, in the past, has allowed the marketing companies to change the manufacturer after approval of retail price in some of the cases, keeping in view of the unavoidable circumstances highlighted by the marketing companies in their submission to NPPA and this has triggered more companies coming up with such requests.

Earlier, Novartis India Ltd had approached the NPPA for its Voveran 1ml AQ – for which the retail price was fixed in May 31, 2019 with Nitin Life Sciences Ltd as manufacturer – informing that in order to support environmentally sustainable business through reduction in supplier footprint, in line with the company’s commitment as per the Environmental Social and Governance (ESG) Policy they plan to get the drug manufactured from another manufacturer Sovereign Pharma Ltd, Daman under the existing brand. It also proposed changes in six to seven excipients, which was later confirmed by the drug regulator as not substantial and does not require a separate license. Based on the information submitted, the Authority permitted the change in manufacturer.

“This was also keeping in view the overall vision of the government for promoting Ease of Doing Business,” said NPPA after its latest Authority meeting.

However, the Authority said, it has observed that subsequent to the application of Novartis, companies started applying to NPPA on a routine basis for change of manufacturer and are now merely intimating about the change citing reasons including change in business strategy, planning to manufacture the formulation at their own plan, etc.

The Authority also permitted Gujarat-based Torrent Pharmaceuticals Ltd to change the manufacturer for its chlorthalidone 12.5mg + telmisartan 40 mg tablet. The company drew attention to certain guidelines set through an office memorandum in November, 2017 and the authority decided that in case the applicant marketing company intends to change the manufacturer for a formulation having the same brand for which retail price has already been provided, it may be allowed to continue to market the formulation with the same brand with the changed manufacturer at the price not exceeding the present applicable retail price.

Torrent Pharma later again approached the Authority informing that due to change in business strategy, it proposes to manufacture brands Rosucor Gold 10 and Rosucor Gold 20, which were manufactured by Synokem Pharmaceuticals and approved by the NPPA, on their own under the existing brand. The Authority permitted the change in manufacturer for these brands also, subject to certain conditions.

“The Authority noted that the change of manufacture was allowed to the companies keeping in view the provisions of the DPCO, 2013, the guidelines and specific circumstances of the company concerned. However, it is observed that companies are making it a routine affair and have started making unauthorised use of the same without seeking permission from NPPA,” it observed.

It was based on these discussions and deliberation on the implications of such developments, the Authority has now come up with the guidelines.

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