The Indian government has announced a significant measure to make cancer drugs more affordable by capping trade margins at 30% of the maximum retail price (MRP). This decision applies to all non-scheduled anti-cancer drugs, encompassing both branded and generic, as well as domestically produced and imported medicines, including patented ones.
Government sources indicate that the new cap, expected to be implemented later this month, will directly impact the prices of 110 anti-cancer drugs, 35 of which are patented. Officials project that some medicine prices could fall by up to 70% depending on their current trade margins, leading to an estimated annual saving of Rs 2,500 crore for patients.
Supreme Court Pressure Led to Action
This policy change comes shortly after the Supreme Court questioned the Centre regarding the exorbitant pricing of cancer medicines. During a hearing on September 29, Justices Vikram Nath and Sandeep Mehta highlighted a case where a cancer drug reportedly cost retailers Rs 2,700 but was sold at an MRP of Rs 27,000.
The apex court urged the government to explore the possibility of applying a uniform trade margin to medicines and scrutinized the practice of corporate hospitals mandating patients to purchase drugs from their in-house pharmacies, particularly when treatment is covered by government schemes. While the court discussed a potential 16% margin, similar to scheduled medicines, it did not issue a direct order for such a cap.
Expanding a Proven Strategy
The 30% trade margin cap is not entirely new. In 2019, the National Pharmaceutical Pricing Authority (NPPA) implemented a similar cap on 42 non-scheduled anti-cancer medicines. That initial measure successfully reduced the MRPs of 526 brands by an average of 50%, saving patients an estimated Rs 984 crore annually.
The latest expansion builds on this success, covering a wider range of drugs and aiming for even greater patient savings. Beyond trade margin caps, the government employs various other strategies to reduce cancer treatment costs, including:
- Effective ceiling prices for 131 anti-cancer drugs, as of March 2026.
- Customs duty cuts on certain medical imports.
- The Jan Aushadhi scheme, promoting affordable generic medicines.
These combined efforts underscore the government's commitment to improving access to cheaper medicines and alleviating the financial burden on cancer patients and their families.