Pharma Sector – Drug Pricing, NPPA, FDC, Generics, etc.

What is National List of Essential Medicines (NLEM)?


From UPSC perspective, the following things are important :

Prelims level: Essential Medicines

Mains level: Not Much

The latest National List of Essential Medicines (NLEM) released September 13, 2022 by the Union health ministry added 34 new medicines and dropped 26 old ones from the previous list.

What is NLEM?

  • As per the World Health Organisation (WHO), Essential Medicines are those that satisfy the priority health care needs of the population.
  • Ministry of Health and Family Welfare hence prepared and released the first National List of Essential Medicines of India in 1996 consisting of 279 medicines.
  • The list is made with consideration to disease prevalence, efficacy, safety and comparative cost-effectiveness of the medicines.
  • Such medicines are intended to be available in adequate amounts, in appropriate dosage forms and strengths with assured quality.
  • They should be available in such a way that an individual or community can afford.

NLEM in India

  • Drugs listed under NLEM — also known as scheduled drugs — will be cheaper because the National Pharmaceutical Pricing Authority (NPPA) caps medicine prices and changes only based on wholesale price index-based inflation.
  • The list includes anti-infectives medicines to treat diabetes such as insulin — HIV, tuberculosis, cancer, contraceptives, hormonal medicines and anaesthetics.
  • They account for 17-18 per cent of the estimated Rs 1.6-trillion domestic pharmaceutical market.
  • Companies selling non-scheduled drugs can hike prices by up to 10 per cent every year.
  • Typically, once NLEM is released, the department of pharmaceuticals under the ministry of chemicals and fertilisers adds them in the Drug Price Control Order, after which NPPA fixes the price.

Significance of EML

  • Drawing an essential medicines list (EML) is expected to result in better quality of medical care, better management of medicines and cost-effective use of health care resources.
  • This is especially important for a resource limited country like India.
  • The list of essential medicines is intended to have a positive impact on the availability and rational use of medicines.

Also read

What is the NPPA’s role in fixing drug prices?


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