The long-awaited National Pharmaceutical Pricing Policy, which aims to keep the prices of essential drugs under control, has finally achieved the Cabinet's approval.

A government source said that the Cabinet approved the National Pharmaceutical Pricing Policy in order ensure the availability of essential drugs at reasonable prices.

Speaking on the topic, the source said, "The National Pharmaceutical Pricing Policy has been approved by the Cabinet with an objective to put in place a regulatory framework for pricing of drugs to ensure their availability at reasonable prices."

The policy intends to keep the prices of 348 drugs under control and thus reduce their prices. Currently, the government controls prices of just 74 drugs and their formulations.

In October, the Supreme Court had ordered the government to finalise the national drug policy by 27th of November 27, while also asking it to take care that the existing mechanism of cost-based drug pricing should not be altered.

According to the new drug pricing policy, pricing of drugs would be based on simple arithmetic average of prices of all brands that have more than 1 per cent market share. Mr. Ranjit Kapadia, senior vice president of institutional research at Centrum Broking, believes that prices of essential drugs could drop by 30-35 per cent after the adoption of the new policy.