ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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PHARMACEUTICALS-Getting Prices Right

Opening for BJP THE fragmentation of the Janata Dal (JD) proceeds apace, a trait inherent from the time of the Janata Party formation in the latter half of the 1970s. The latest split in the JD family has been the opting out of the Naveen Patnaik-led faction and its formation of the Biju Janata Dal (BJD) in Orissa. But what is new about some of the recent fissures in the Janata Dal is that the newly-formed splinter groups are aligning with the Bharatiya Janata Party (BJP), once an arch rival of the JD, as is evident from George Fernandes' Samata Party in Bihar, Ramkrishna Hegde's Lok Shakti in Karnataka and now the BJD in Orissa, The JD in Orissa functioned as a personal fiefdom of Biju Patnaik. It was his adamant stance vis-a-vis the left parties in the state that led to the breakdown of the JD-Left alliance in Orissa during last Lok Sabha elections, and because of which the JD suffered heavy losses, winning just three of the 21 Lok Sabha seats in the state. This distancing from the left was already an indication of things to come. For in the quadrangular contests fought in the last Lok Sabha elections between the Congress, the BJP, the JD and the Left, though it was the Congress which emerged the winner, the BJP too increased its strength significantly, A postmortem of the last elections showed that the split of votes between the BJP and the JD decisively helped the Congress in western Orissa. Hence it was no surprise that the demand to enter into an understanding with the BJP for the forthcoming elections to stem the downslide swing of the party should have come first from JD leaders belonging to western Orissa. Moreover, the victory of the BJP candidate in the Bhubaneshwar state assembly by-election and an informal understanding worked out with the BJP during the municipal and panchayat polls in the state reinforced the argument within the JD for alignment with the BJP, Though most of the MLAs from the coastal region of the state have not joined the BJD, Naveen Patnaik was able to carry along with him 29 of the 43 JD MLAs. With the ususal tug-of-war over seat-sharing now behind them, the BJD-BJP alliance is in a position to change the electoral equation in the state. The Congress will face a tough challenge from the combined strength of the BJP and the BJD in western Orissa where during last elections five Congress candidates had scraped through with margins of a few thousand votes. Yet the Congress may strengthen its position in the coastal region, with the split of votes between the BJP-BJD alliance and the JD-Left alliance. Another factor which crucially favours the Congress in the state is the relative absence of factionalism within the patty under the J B Patnaik leadership. But political developments in the state augur well for the BJP, as the party is all set to open its account in the eastern states of India where till now it had drawn a blank, PHARMACEUTICALS Getting Prices Right IT does not come as a surprise that the minister for chemicals and pharmaceuticals, M Arunachalam, should take it upon himself to stay the notification reducing the price of ranitidine, a widely used anti-ulcer drug, on a review petition filed by Glaxo. Ranitidine was one of the 110 drugs the prices of which had been lowered by the newly-constituted National Pharmaceutical Pricing Authority (NPPA) last month, following the directive of the Bureau of Industrial Costs and Prices (BICP) reducing the prices of some bulk drugs. The minister's contention is that the parameters and assumptions taken into consideration by the NPPA as well as the BICP were faulty and that the price data supplied by the manufacturers who include Glaxo, Shasun and Cheminor had not been adequate for fixing the new price of the drug. The minister had apparently issued an order in November 1997 that the current price of ranitidine should not be changed till further examination. At that point the department had sent a reply to the minister, a 'protest note1, pointing out that the methodology followed by the BICP in recommending fair prices was the same in all cases. The minister had then sought clarifications on several aspects. Meanwhile Glaxo filed a writ petition in the Bombay High Court challenging the notification, bringing the situation to a head. This was when the minister unilaterally stayed the order and issued a notice to the department for flouting his orders: "my directions have not been followed and I would like to know why". Following this the department has decided to withhold the price revision order, flouting, it needs to be pointed out, the directions of an authority constituted to be an independent technical body for the purpose of fixing drug prices on the basis of data obtained from various sources, including the industry. It is pertinent to point out that the NPPA was set up in response to criticism by industry and the consumer movement alike, though from entirely different standpoints, that the fixing of prices should be in the domain of an authority which cannot be faulted for being biased for or against industry. In any case, is it not the duty of the minister to uphold the decisions of bodies constituted within his department to decide upon just such issues? The setting up of the NPPA ran into a series of problems, especially from the ministry's babus, though the industry had welcomed the move wholeheartedly. But the first directive of the NPPA cutting the prices of several drugs on the ground that they had not been revised after the lowering of the prices of bulk drugs of which they were formulations changed the industry's attitude to that body. It promptly sought to have these downward revisions stayed. While this in itself was to be expected, it is the minister's intervention which needs to be commented upon.

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