Read or download the official PDF of this gazette notification issued by the Ministry of Chemicals and Fertilizers :
Department of Pharmaceuticals on 11th August 2026. Classified under Press Release.
Executive Summary
This report outlines the regulatory framework for drug pricing in India under the Drugs (Prices Control) Order 2013 (DPCO) and the National Pharmaceutical Pricing Authority (NPPA). It details mechanisms for fixing ceiling prices, monitoring compliance, and implementing government initiatives to improve medicine affordability. The document highlights a significant reduction in out-of-pocket health expenditure, attributed to strict price controls and schemes such as the Pradhan Mantri Bhartiya Janaushadhi Pariyojana.
Key Points / Main Content
Pricing Regulations under DPCO 2013
The NPPA fixes ceiling prices for scheduled formulations and retail prices for "new drugs" based on market data.
Manufacturers must sell scheduled drugs at or below the notified ceiling price (plus applicable GST).
For non-scheduled formulations, manufacturers are prohibited from increasing the MRP by more than 10% within any 12-month period.
Manufacturers are permitted to sell drugs at prices lower than the notified ceiling or retail prices based on market dynamics.
Compliance and Monitoring
Every manufacturer must print the MRP on the label of the drug container.
It is illegal to sell any formulation to a consumer at a price exceeding the current price list or the printed MRP, whichever is lower.
The NPPA monitors overcharging through State Drugs Controllers, Price Monitoring and Resource Units, market samples, and consumer grievances.
Access and Affordability Initiatives
PMBJP: Over 20,000 Janaushadhi Kendras provide generic medicines at 50% to 80% less than branded alternatives.
AB-PMJAY: Provides health insurance cover of ₹5 lakh per family per year for secondary and tertiary hospitalization.
Free Drugs Service Initiative: Essential medicines are provided free of charge at public health facilities, including PHCs and district hospitals.
AMRIT: Offers medicines for cancer and cardiovascular diseases, along with implants, at up to 50% discount through specialized pharmacy stores.
Financial Assistance: Poor patients suffering from life-threatening diseases can receive grants under Rashtriya Arogya Nidhi and the Health Minister’s Discretionary Grant.
Impact Analysis
Pharmaceutical ManufacturersImpact
Manufacturers are restricted by mandatory ceiling prices for scheduled drugs and a 10% annual cap on price increases for non-scheduled drugs. They face strict monitoring for overcharging.
Action Required
Must ensure all products are sold within notified price limits and that the MRP is clearly printed on all formulation containers.
Consumers and PatientsImpact
Patients benefit from lower costs, with out-of-pocket health expenditure decreasing from 62.6% (2014-15) to 43.4% (2022-23). They gain access to free or highly subsidized essential medicines through government schemes.
Action Required
Can utilize grievance redressal channels to report overcharging and access affordable medication through Janaushadhi Kendras or AMRIT pharmacies.
Healthcare Facilities and PharmaciesImpact
Public health facilities are tasked with distributing free essential medicines, while specialized outlets like AMRIT and Janaushadhi Kendras must manage subsidized inventory.
Action Required
Must adhere to the Indian Public Health Standards (IPHS) for medicine availability and ensure no consumer is charged above the regulated MRP.
Key Entities Referenced
Drugs (Prices Control) Order 2013 (DPCO, 2013): The primary legal framework that empowers the government to regulate drug prices, fix ceiling prices for scheduled formulations, and monitor retail prices of new drugs.
National Pharmaceutical Pricing Authority (NPPA): The nodal regulatory body responsible for fixing and notifying ceiling prices, monitoring compliance, and taking action against overcharging under the DPCO 2013.
National Pharmaceutical Pricing Policy, 2012 (NPPP, 2012): The foundational policy document that establishes the principles for the regulation and rationalization of pharmaceutical prices in India.
Pradhan Mantri Bhartiya Janaushadhi Pariyojana: A government initiative to provide quality generic medicines at significantly lower rates (50% to 80% cheaper) through a nationwide network of Janaushadhi Kendras.
Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY): A flagship health assurance scheme providing ₹5 lakh insurance cover per family for hospitalization, including the cost of medicines.
Ministry of Chemicals and Fertilizers :
Department of Pharmaceuticals
Regulation and rationalisation of maximum retail
prices of medicines
प्रव तथ: 11 AUG 2026 3:10PM by PIB Delhi
Prices of drugs are regulated as per the provisions of the Drugs (Prices Control) Order 2013 (DPCO,
2013) which has been promulgated based on the principles of the National Pharmaceutical Pricing Policy,
2012 (NPPP, 2012). National Pharmaceutical Pricing Authority (NPPA) under Department of
Pharmaceuticals fixes ceiling prices of formulations specified in Schedule-I to DPCO and the retail price
of a new drug as defined under 2(1)(u) of DPCO 2013, based on market data and as per the provisions of
DPCO, 2013. The ceiling prices of scheduled drugs are applicable to all manufacturers and retail prices
fixed for new drugs are applicable to applicant manufacturer and marketer and they have to sell them
within the notified ceiling price or retail price (plus applicable GST) by the NPPA. However,
manufacturers are free to sell at a price lower than the ceiling price for the schedule drug and retail price
fixed for new drug, as per the market dynamics.
There is no restriction on manufacturer fixing different prices for same schedule formulation under
different brand names as long as it is below the ceiling prices fixed by NPPA for that drug. In case of non-
scheduled formulations, a manufacturer is allowed to fix the price of the drug but are required to not
increase MRP of a non-scheduled drug by more than 10% of MRP during the preceding 12 months.
Such price regulation in conjunction with various other initiative taken by government to improve the
access to healthcare facilities has resulted in a decline in the share of out-of-pocket expenditure in Total
Health Expenditure from 62.6% in 2014-15 to 43.4% in 2022-23.
NPPA monitors the compliance with the provisions of the DPCO, 2013 and takes appropriate action in
cases of overcharging and other violations, in accordance with the provisions of DPCO, 2013, based on
references received from various sources, including Price Monitoring and Resource Units set up in States,
State Drugs Controllers, samples purchased from open market, reports from market database and
complaints lodged through various grievance redress channels. Further, to prevent overpricing, DPCO
2013 requires every manufacturer of a formulation to print the maximum retail price on the label of the
container of such formulation. No person is permitted to sell any formulation to any consumer at a price
exceeding the price specified on the current price list or price indicated on the label of the container or the
pack thereof, whichever is less.
In addition to regulating the prices of drugs under DPCO, 2013, various other measures have been taken
by the Government to improve the access of medicines at affordable rates to the common man which, inter
alia, include the following:
i. Under the Pradhan Mantri Bhartiya Janaushadhi Pariyojana scheme quality generic medicines
is provided through more than 20,000 Janaushadhi Kendras at rates that are typically 50% to
80% cheaper than branded medicines.
ii. Under Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY) of the Department
of Health and Family Welfare, health assurance/insurance cover of ₹5 lakh per family peryear is provided for secondary or tertiary care hospitalisation, including for medicines.
iii. Under the Free Drugs Service Initiative of the National Health Mission, essential medicines
list recommended under the Indian Public Health Standards (IPHS) are made available free of
any charge at public health facilities ranging from Primary Health Centres (PHCs) to district
hospitals across the country.
iv. Under the Amrit (Affordable Medicines and Reliable Implants for Treatment) initiative of the
Department of Health and Family Welfare, affordable medicines are provided for the
treatment of cancer, cardiovascular and other diseases, implants, surgical disposables and
other consumables etc., at an average discount of up to 50% on market rates through AMRIT
Pharmacy stores set up in number of hospitals and healthcare institutions.
v. Financial assistance is provided to poor patients belonging to families living below the
poverty line, who suffer from major life-threatening diseases including cancer, under the
umbrella scheme of Rashtriya Arogya Nidhi and the Health Minister’s Discretionary Grant.
This information was given by Minister of State for Chemicals and Fertilizers, Smt. Anupriya Patel, in a
written reply in the Rajya Sabha today.
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