Cancer Drug Price Control in India: 30% Trade Margin Cap on 110 Medicines

10 Oct 2026

Subject: GS Paper 2: Health

Context: The Center plans to cap trade margins at 30% for 110 non-scheduled cancer drugs, including 35 patented medicines, to reduce patients’ out-of-pocket expenditure on cancer treatment.

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Key Features of the Proposed Move

Coverage: The list will include branded and generic, domestic and imported, patented and non-patented medicines, including 35 patented drugs.

Regulatory Framework for Drug Price Control in India

Drugs (Prices Control) Order (DPCO), 2013: Provides the framework for regulating medicine prices in India.
National List of Essential Medicines (NLEM): Prices of scheduled medicines included in the list are subject to government price control.
Previous Intervention (2019): The National Pharmaceutical Pricing Authority (NPPA) capped trade margins at 30% for 42 cancer medicines, resulting in reported MRP reductions of up to 91%.

Expected Price Reduction: Maximum Retail Prices (MRPs) of some medicines could fall by up to 70%.
Identification of Drugs: A committee under the Director General of Health Services (DGHS) is finalising the list.
Selection Criteria: Medicines should be expensive, approved for cancer treatment in India, and frequently used.

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About Trade Margin

Trade Margin is the difference between the price at which a distributor procures a drug from a pharmaceutical manufacturer and the Maximum Retail Price (MRP) paid by the patient.
Existing Markups: The National Pharmaceutical Pricing Authority (NPPA) reportedly found an average trade markup of approximately 170%, with some cases reaching up to 700%.

News Source: IE

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