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NMRA issues cancellation notices to five pharmaceutical companies

The NMRA yesterday issued notices of cancellation of registrations and import licenses to five pharmaceutical companies including Hemas Pharmaceuticals and A. Baur (Pvt) Ltd for arbitrarily and unilaterally increasing the retail prices of 10 medicines.

Notices of cancellation have been issued to the following companies under Section 65 of the NMRA Act No 5 of 2015 for violating pricing regulations: 

NMRA Legal Officer Pushpamala Hettiarachchi told Daily Mirror these companies had increased prices of medicines during the past few months in violation of the conditions of registration issued by the Authority causing much hardship to patients especially in the background of the ongoing COVID-19 pandemic. “The punitive action, believed to be the first for violating pricing regulations of medicines, has been taken under powers vested with the Authority to ensure affordability of medicines and availability to the public,” she said.

Among these medicines is a brand (Diltiazem) that has already been gazetted with a maximum retail price. “They have repeatedly increased the price from Rs.40.70 a tablet to Rs.43.70. Once gazetted the price cannot be changed. If they want to increase the price they have to do so after discussing with the Authority.”

However, the NMRA initially wrote a letter dated May 29, 2020 to the Sri Lanka Chamber of Pharmaceutical Industries (SLCPI) which represents its constituent members on the above concerns. In a response letter, the SLCPI claimed the NMRA only has powers to determine the initial prices of medicines, medical devices and borderline products and advise the minister on subsequent price revisions. This is in reference to Section 14 (q) of the NMRA Act.

Excerpts of the SLCPI letter are as follows :

“While we contest and have always contested the regulations being prescribed by the Minister of Health on price control including Gazette Extraordinary No. 2123/35 dated 15th May 2019 (hereinafter referred to as “the Price Ceiling regulation”) prior to prescribing a pricing mechanism through a consultative process as provided for in Section 118 (4) of the NMRA Act, which position has already been averred by us in the Court of Appeal case bearing No. CAWA 517/2019, we wish to place on record that none of the medicines specified by your high authority in the said Letter dated 29th May 2020 and the Letters of Warning fall within the list of medicines specified in the Price Ceiling Regulation.

As you are well aware, it is with greatest difficulty, much deliberation and endless negotiations with your high authority and the Ministry of Heath that the price enhancement of 14.4% was prescribed for these price- controlled medicines, yet without imposition of an objectively formulated pricing mechanism in accordance with the provisions of the NMRA Act, as requested by the stakeholders including SLCPI.

In these premises, we are compelled to believe that the decision of your high authority to withdraw your high authority’s recommendation on proposed price enhancement of 9% for the price- controlled medicines, which in our opinion is unreasonable and capricious, is backed by male fide and unscrupulous intentions to unlawfully control the pricing of the non-price-controlled medicines. Such action of your high authority will only result in the withdrawal of some vital life saving and reliable medicines as the Importers will find it impossible to ensure continuous supply of such products to the market due to the continuous losses they will be incurring owing to the rupee devaluation and escalation of costs.

We wish to place on record that none of the members of SLCPI has violated any of the pre-conditions set out in Section 65 of the NMRA Act which warrants the cancellation of the certificates of registration and/or the relevant licenses issued thereto and if any action is taken by your high authority in terms of Section 65 of the NMRA Act, such action will be ultra vires and invalid in law in as much as it will amount to a complete abuse of powers entrusted upon your high authority by the legislature.”

Source: Daily Mirror

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