New Cap Cuts Cancer Drug Costs

Effective next month, the price of 137 cancer medicines in India will drop by up to 70%. The Indian Department of Pharmaceuticals announced this change to extend a 30% trade margin cap to drugs previously exempt from the rule. The move follows a Supreme Court ruling that described current price markups as extortion and carnage.

The initiative traces back to Sarojam Radhakrishnan, a retired bank clerk from Kerala. She was diagnosed with breast cancer in 2021. Her doctors prescribed targeted treatments that cost more than 63,000 rupees, or about 500 pounds, per month. Her family could not afford the bill. In 2022, she petitioned the Kerala high court to force the government to lower costs.

The case eventually reached the Supreme Court. Justices Vikram Nath and Sandeep Mehta reviewed the pricing structure during a hearing on September 29. They noted that a specific cancer drug cost hospitals 2,700 rupees to supply but was sold to patients for 27,000 rupees. The court concluded that hospitals, distributors, and chemists were taking excessive margins from these sales.

Data from the National Pharmaceutical Pricing Authority supports the court's findings. Trade markups on certain cancer drugs averaged 170%. In some extreme cases, the markup exceeded 700%. A 30% margin cap had already applied to 42 drugs for years. The new order adds 137 more medicines to that regulated list.

The Department of Pharmaceuticals stated that the new cap is expected to help patients save 2,500 crore rupees, or 199 million pounds, annually. This reduction directly lowers the amount patients must pay from their own pockets. The government aims to reduce the financial pressure that often forces poorer patients to skip treatment, sell land, or accumulate debt.

The financial strain on Indian families is severe. Krishan Kalra, a former council member of the Rajiv Gandhi Cancer Institute and Research Centre, observed that few people attend free diagnosis camps in Gurgaon. He explained that patients are too scared to go because they lack funds for treatment if diagnosed. Cancer drugs currently range in price from 38,000 to 380,000 rupees.

Studies from the Public Health Foundation of India indicate that healthcare spending pushes approximately 55 million Indians below the poverty line each year. The government's Ayushman Bharat insurance scheme offers some relief but remains limited. It provides 500,000 rupees in annual coverage per family. That amount equals the cost of one dose of Kadcyla, a breast cancer drug for which patients may require up to 14 doses.

Dr. Ravi Kannan, a surgical oncologist in Assam, called the decision a welcome step if more patients can access necessary drugs. He noted that some families start treatment but cannot sustain it due to cost. Jyotsna Singh, co-convener of the Working Group on Access to Medicines and Treatments, argued that a total overhaul of healthcare is needed. She warned that companies and hospitals might seek legal loopholes or raise other charges to offset lower drug prices.

India records about 1.56 million new cancer cases annually, up from 1.39 million in 2020. The Supreme Court has also asked government lawyers why the margin cap should apply only to cancer drugs and not to all non-patented medicines. The government has until October 27 to respond to that question. The legal victory came after Radhakrishnan's death in September 2022, while her case was still pending in Kerala.