Cancer, HIV/AIDS drugs may go cheaper in India

Prices of drugs to treat cancer and AIDS could become cheaper in India as the government is proposing a total customs duty waiver for these life-saving drugs in the budget fiscal year 2010-11, reports said.

Cancer, which accounts for nearly 4% of the total number of yearly deaths occurring in India, is the second largest non-communicable disease in the country.

Oral and lung cancer in males and cervix and breast cancer in women account for over half of all cancer deaths in India. Market for breast cancer drugs alone is expected to double from $35 million in 2007 to $64 million by 2012.

Both MNCs as well as domestic companies including GSK, Roche, Pfizer, Dr Reddy’s, Cipla, Biocon, Natco and Ranbaxy vie for the fast-growing cancer drug market in India.

Despite the competition most of the cancer drugs available in Indian market are too expensive for the common man.

Recently celebrities like K J Yesudas has come forward filing litigations to bring down costs of life-saving medicines sold in India making them affordable to the poor and needy.

Some of the cancer new generation cancer drugs costs hundred to three hundred times the price of the similar therapies available in the Indian market.

Pfizer, for example, which was granted a patent for its kidney cancer drug Sutent (sunitinib) in India in 2007, launched the drug at a price of Rs 1.96 lakh for a 45-day treatment in the country.

Roche’s Tarceva is another case in point. Tarceva (erlotinib) is a novel therapy for patients with locally advanced or metastatic non-small cell lung cancer (NSCLC) after failure of at least one prior chemotherapy regimen. Tarceva costs around Rs 3,30,000 for a 3-month treatment.

Indian drug makers also have several oncology drugs marketed in India. Dabur, Dr Reddy’s, Cipla, Natco are some of the prominent players in the oncology segment.

Recently, Surinder Singh, the Drug Controller General of India (DCGI) had recommended that cancer drugs be brought under the National Pharmaceutical Pricing Authority (NPPA).

“As the DCGI, I have outlined the technical inputs and rationale behind the suggestion for the inclusion of new drugs. Cancer drugs, in particular, should be included, since they are expensive and beyond the means of the common man,” Mr Singh was quoted as saying.

Even though the DCGI has mooted the proposal, a final decision on this was to be taken by the department of pharmaceuticals.

So are drugs used to treat HIV infection. Even though, the government-sponsored AIDS programme offers three anti retroviral drugs to patients free of cost, none of the far too expensive new generation HIV therapies is covered under it.

A proposal to cut down the excise and customs duties levied on cancer and HIV drugs across the board was mooted by the Department of Pharmaceuticals as part of its pre-budget recommendation made to the Union Finance Ministry to make drugs in critical segments in June.

The Department of Pharmaceuticals was set up in 2008 under the Ministry of Chemicals and Fertilizers to oversee and promote the pharmaceutical industry in India.

Excise duties of certain drugs used in critical segments like cancer is already cut down to zero or four percent.

The Union Government brought down the excise duties on medicines in 2008 budget to 8 percent from 16 per cent. In December 2008, the Union Government slashed the excise duty again to 4 per cent.

The Department of Pharmaceuticals has reportedly sought the Finance ministry to continue the duty at  4 per cent for the finished drug formulations.

The dept has also  recommended an increase in the rate of abatement on the MRP-based excise to 60 per cent.

The finance ministry is also sought a weighted deduction on research be extended from 2010 to 2017, the official said. At present drug companies get 125 per cent weighted deduction on research outsourced to a third party and 150 per cent on in-house research, reports said.

The 2009-10 Budget totally exempted influenza vaccines, nine life saving medicines inluding the ones used for treating breast cancer, hepatitis-B , rheumatic arthritis from excise duty and countervailing duty. The customs duty for two bulk drugs used in manufacturing these medicines was also cut from 10% to 5%.

The finance ministry may also revise the weighted deduction on expenditure on research and development (R&D ) by drug companies upward to 200% from 150%, as well as extending the benefit by five years to March 2017 from the current 2012 cut-off date under Section 35 (2AB) of the Income-Tax Act, reports said.

The proposal is aimed at encouraging research. Further, coverage of the Section could be extended to expenditure incurred for obtaining regulatory approvals and filing of patents abroad.

“Treatment of cancer and AIDS is prohibitively expensive . If prices of these imported drugs need to be reduced considerably , in line with the mandate of the pharmaceutical policy to make available quality medicines at reasonable prices,” said a senior government official.