NPPA caps trade margins at 30% for 137 cancer drugs; prices to fall up to 70%

The government has capped trade margins at 30% for 137 anti-cancer drugs, a move expected to ease the financial burden on patients by reducing their maximum retail prices (MRPs) by up to 70%.

The National Pharmaceutical Pricing Authority (NPPA), under the Department of Pharmaceuticals, has undertaken the exercise to curb excessive trade margins and make cancer treatment more affordable.

The notification said concerns had been raised over the “wide disparity between the procurement price and the Maximum Retail Price (MRP) charged from consumers”, with high trade margins in expensive cancer medicines substantially increasing patients' expenditure.

The price cap applies to non-scheduled formulations containing any of the 137 specified drugs, whether used individually or in combination, irrespective of dosage strength, dosage form or route of administration. It also covers patented drugs.

The list includes immunotherapy drugs used to treat more than 20 types of cancer, besides medicines such as pembrolizumab, durvalumab and osimertinib. It also covers denosumab, used by breast and prostate cancer patients, pegfilgrastim, which helps prevent neutropenia in cancer patients, and bevacizumab, approved for treating colon, ovarian and cervical cancers.

Under the prescribed formula, manufacturers must calculate the revised MRP using the price at which a medicine is sold to a stockist or distributor, with the trade margin not exceeding 30%, plus applicable GST. The calculation will generally use the price to stockist or distributor for March 2026.

A formulation with a price to stockist of ₹70 can have a maximum revised MRP of ₹100, excluding applicable GST, under the 30% trade margin cap.

Manufacturers selling formulations above the newly calculated MRP will have to reduce their prices, while those already selling below the prescribed ceiling must maintain their existing MRPs.

The revised prices will come into effect from November 9, 2026.

The notification requires manufacturers to circulate revised price lists to dealers and retailers within seven days, display price-related information on their websites and report the price to stockists or distributors and MRPs through the NPPA's Integrated Pharmaceutical Database Management System (IPDMS).

The order also requires manufacturers to maintain existing production levels.

Companies intending to reduce average monthly production will have to obtain prior permission from the NPPA, while those planning to discontinue production or imports must provide the prescribed information at least six months in advance.

The notification builds on the NPPA's 2019 pilot exercise, when trade margins for 42 non-scheduled anti-cancer drugs were capped at 30%. According to the government, MRPs of 526 brands of non-scheduled anti-cancer medicines were subsequently reduced by up to 90%.