Abstract :
The cost of drugs contributes significantly to healthcare expenditure, and any reduction in the cost of medication would provide relief to all. Conventionally, the use of generic drugs is the method of reducing medication cost, however efforts to make prescription by generic name compulsory have failed. India also has a third type of products in addition to branded and generic products, called branded generics. Most drugs are thus available as branded, generic and branded generic versions. Branded generics offer an alternate option for cost cutting, to use of generics. Prices of drug formulations that are included in the “Essential List of Medicines” are fixed by the National Pharmaceutical Pricing Authority, that declares their ceiling price. Examination of the ceiling prices suggests that either the prices are calculated arbitrarily or are manipulated. There is also a lobby of retail chemists, that ensures that low price brands are not easily available to consumers, since they eat into their profits. The current study shows how one could reduce the cost of medicines in India. Educating consumers to understand the pharmaceutical market could drastically reduce the cost of medication.
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