137 Cancer Drugs: Prices to Drop by Up to 70%

The Indian government will reduce the cost of 137 cancer medications starting next month. This move follows a Supreme Court ruling that labeled previous price increases by hospitals and retailers as extortion. The new rules extend an existing 30% cap on trade margins to a wider list of drugs.

The National Pharmaceutical Pricing Authority analyzed the supply chain and found that trade markups on certain cancer drugs averaged 170%. In extreme cases, these markups exceeded 700%. A 30% margin cap had already applied to 42 drugs for several years, but the government has now added 137 additional medicines to that list.

The Department of Pharmaceuticals stated that this measure is expected to lower medicine prices by up to 70%. The department projected that cancer patients could save 2,500 crore rupees, approximately 199 million pounds, each year. This reduction aims to cut the amount patients must pay out of pocket for essential treatments.

The legal action began with Sarojam Radhakrishnan, a former bank employee in Kerala. She was diagnosed with breast cancer in 2021 and prescribed targeted treatments. The monthly cost of her medication was over 63,000 rupees, a sum her family could not afford. In 2022, she petitioned the Kerala high court to intervene and lower costs.

When the case reached the supreme court, justices Vikram Nath and Sandeep Mehta examined the pricing structure. They noted that one specific cancer drug was supplied to hospitals for 2,700 rupees but sold for 27,000 rupees. The court described the situation as carnage and extortion, finding that intermediaries enjoyed large margins.

The financial strain on families is severe. Krishan Kalra, a former council member of the Rajiv Gandhi Cancer Institute and Research Centre, noted that few people attend free diagnosis camps in Gurgaon. He explained that patients are often too scared to get tested because they lack the funds for treatment. Cancer drugs currently range in price from 38,000 to 380,000 rupees.

Dr. Ravi Kannan, a surgical oncologist at Cachar cancer hospital and research centre in Assam, said some families start treatment but cannot sustain it long term. He called the new decision a welcome step. He hopes it will help more patients access the drugs they need. However, insurance coverage remains limited.

The government's Ayushman Bharat scheme provides 500,000 rupees in annual cover per family. This amount equals the cost of one dose of Kadcyla, a breast cancer drug that patients may require up to 14 doses of. Jyotsna Singh, co-convener of the Working Group on Access to Medicines and Treatments, warned that companies might seek legal loopholes or raise other charges to offset lower drug prices.

India records approximately 1.56 million new cancer cases annually, up from 1.39 million in 2020. The supreme court has asked government lawyers why the cap should not apply to all non-patented medicines. The government must respond by 27 October. Sarojam Radhakrishnan died in September 2022 while her case was still pending.