85% of Rs 8,526 crore overcharging demand unrecovered, NPPA faces 15 vacant posts

Who it concerns: The report concerns the Department of Pharmaceuticals and the National Pharmaceutical Pricing Authority (NPPA). It affects the general public, specifically patients purchasing medicines, as well as drug manufacturers, distributors, and retailers.

What the committee found

• The Committee recommended finalizing a permanent Trade Margin Rationalisation (TMR) framework within a defined timeline to curb arbitrary initial prices of non-scheduled drugs.
• The Committee recommended instituting a fast-track dispute resolution mechanism for non-litigated overcharging cases and setting up a dedicated legal cell within NPPA to handle long-pending court cases.
• The Committee recommended the Ministry examine the feasibility of reintroducing cost-based pricing through statutory amendments to detect price distortions caused by market monopolies.
• The Committee recommended incorporating hospital sales, Jan Aushadhi stores, trade generics, and e-commerce supplies into NPPA's data collection framework to reduce reliance on third-party data.
• The Committee recommended NPPA take steps to increase public awareness and stakeholder participation in price fixation, noting that only industry representatives submitted comments on draft price worksheets between 2022 and 2025.
• The Committee recommended filling existing vacancies through regular appointments and expediting approval for 59 additional posts to reduce reliance on contractual staff.

Also in the document

• As of 2025, Rs 8,526 crore (85%) of the total amount demanded for overcharging remained unrecovered, with 70% of this amount under litigation, some cases pending for over 20 years.
• 15 of the 48 sanctioned posts in NPPA are vacant, with contractual or outsourced staff engaged to maintain essential work.
• Between 2022 and 2025, only 30 representations were received out of 1,426 draft price worksheets uploaded for public comment, and all 30 were from the industry.
• NPPA relies on a private agency for sales data that covers only about 70% of the pharmaceutical market, excluding segments like hospital sales and e-commerce.