Cancer Treatment to Become More Affordable as NPPA Clears 20–70% Price Cuts on Drugs

Cancer Drug Prices in India May Drop by 20–70% as NPPA Clears Trade Margin Cap

Cancer treatment in India could become significantly less expensive after the National Pharmaceutical Pricing Authority (NPPA) approved an in-principle proposal to cap trade margins on selected non-scheduled anti-cancer medicines. The government estimates that the move could reduce maximum retail prices (MRPs) by 20% to 70% and save patients approximately ₹2,500 crore annually.

The proposal seeks to limit the total trade margin to 30% of the MRP for identified cancer medicines. The restriction is intended to curb excessive mark-ups charged along the supply chain, from distributors and wholesalers to retailers.

However, the price cuts are not yet effective. The final list of medicines covered by the proposal must be prepared before the measure can be formally implemented.

According to the minutes of the NPPA meeting held on Thursday, the authority approved the proposal following deliberations on regulating trade margins for non-scheduled anti-cancer drugs.

The expected benefits include lower out-of-pocket expenditure, improved access to treatment and greater transparency in the prices patients pay for essential medicines.

NPPA Approves 30% Cap on Trade Margins

The NPPA has approved the proposal under Paragraph 19 of the Drugs (Prices Control) Order (DPCO), 2013, which empowers the government to intervene in drug pricing in the public interest.

The decision follows a directive from the Department of Pharmaceuticals (DoP), which asked the regulator to introduce trade margin rationalisation for non-scheduled anti-cancer medicines along the lines of the exercise undertaken in 2019.

The DoP has also asked the Union Health Ministry to constitute an expert committee under the Directorate General of Health Services (DGHS) to identify the medicines that should be included. The committee has been asked to submit its report by October 14, 2026.

The list may be revised periodically to account for changes in the pharmaceutical market and evolving public health requirements.

The NPPA said the intervention was necessary to address concerns over excessive mark-ups and their impact on patients, adding that consumer interests must remain the priority.

Cancer Medicines Could Become Up to 70% Cheaper

The estimated reduction in medicine prices will depend on the existing trade structure and the mark-up applied to individual products.

The NPPA expects MRPs to fall by approximately 20% to 70% for the medicines covered under the proposal. The government has projected annual savings of around ₹2,500 crore.

An analysis of data from pharmaceutical research firm Pharmarack indicates that non-scheduled anti-cancer medicines carry an average trade mark-up of about 170%, with some products recording mark-ups as high as 700%.

The regulator has also highlighted substantial differences in transaction prices across retail pharmacies, hospitals and online pharmacies, including variations in discounts from printed MRPs.

By restricting the permitted trade margin, the government hopes to ensure that excessive mark-ups do not unnecessarily increase the financial burden on cancer patients.

How Will the Proposed Price Cap Work?

Trade margins represent the difference between the price at which medicines enter the distribution chain and the price charged to the next buyer. Distributors, wholesalers and retailers each operate within this supply chain.

Under the proposed rules, the combined trade margin for identified medicines would be limited to 30% of the MRP.

For instance, if a medicine carries an MRP of ₹100, the permitted trade margin would be capped at ₹30 under the proposed framework. The actual reduction in the medicine’s printed price would depend on its existing pricing structure and how the supply chain adjusts.

Non-scheduled medicines are those that fall outside the government’s list of drugs subject to fixed ceiling prices. Their prices are not fixed through the same mechanism used for scheduled medicines, although the NPPA monitors price increases under applicable rules.

Patients should note that the proposed cap has not yet been formally notified. Actual price reductions will become clearer once the final list is announced and revised MRPs are implemented.

Which Cancer Drugs Are Already Under Price Control?

The National List of Essential Medicines (NLEM), 2022, includes 388 medicines, of which 63 are anti-cancer drugs. These scheduled medicines are already subject to government price controls through the ceiling-price mechanism.

The broader anti-cancer drug market in India comprises approximately 225 drugs and 500 formulations, with an estimated annual turnover of ₹12,500 crore.

Scheduled cancer medicines account for around ₹2,250 crore of this market, while non-scheduled medicines make up the remaining share.

The latest NPPA proposal specifically targets identified non-scheduled anti-cancer medicines. It does not automatically mean that every cancer drug available in India will receive a price reduction of 20% to 70%.

Supreme Court Questions High Mark-Ups on Cancer Drugs

The government’s decision comes amid growing scrutiny of cancer medicine prices by the Supreme Court.

On September 22, the court reportedly criticised the high prices of essential cancer medicines, describing the overpricing as daylight robbery of patients.

During a hearing on September 29, a bench comprising Justices Vikram Nath and Sandeep Mehta referred to a medicine reportedly supplied to retailers for approximately ₹2,700 but sold at an MRP of around ₹27,000.

The bench questioned why the 16% retailer margin provided under the DPCO should not apply to all medicines. The matter was scheduled for a further hearing on October 12.

The court’s observations have intensified the debate over the affordability of cancer treatment and the adequacy of existing safeguards against excessive drug pricing.

What Did the 2019 NPPA Exercise Achieve?

The NPPA previously used its powers under Paragraph 19 of the DPCO to regulate trade margins on non-scheduled anti-cancer medicines in 2019.

The measure, notified on February 27 that year, covered 42 non-scheduled cancer drugs. According to figures cited in the authority’s meeting minutes, the exercise led to substantial MRP reductions, including cuts of up to 91% across 526 brands.

The intervention was estimated to generate annual savings of approximately ₹984 crore.

The new proposal follows a similar approach, with the government anticipating a larger financial benefit for patients if the proposed restrictions are implemented.

Activists Warn That Margin Caps May Not Be Enough

The Working Group on Access to Medicines and Treatments has cautioned that controlling trade margins alone may not make all cancer medicines affordable, particularly expensive patented treatments.

Co-convenors Jyotsna Singh and K M Gopakumar argued that some medicines remain costly even when distribution margins are reduced. They cited pembrolizumab, sold under the brand name Keytruda, saying that a vial costs approximately ₹1,95,000.

The group has called for greater use of public health safeguards under the Patents Act, including government-use provisions under Section 100 and compulsory licensing where legally justified. Such measures, it argues, could enable generic production and help address the underlying cost of patented medicines.

Their position highlights the distinction between reducing distribution mark-ups and lowering the price charged by manufacturers.

Pharma Industry Supports Targeted Action

A pharmaceutical industry official, speaking anonymously, supported the government’s intervention but said unusually high trade margins were concentrated in a relatively small group of products.

According to the official, most non-NLEM medicines operate within normal distribution and discount ranges, while some specialised and hospital-based therapies show unusually high margins.

The official argued that corrective action should focus on the areas where pricing distortions occur.

What Cancer Patients Need to Know

The proposed cap could offer substantial relief to patients purchasing selected non-scheduled cancer medicines, particularly those currently carrying exceptionally high trade mark-ups.

However, the projected 20%–70% reduction is an estimate, not a guaranteed discount for every medicine. The final savings will depend on which drugs are included, their existing prices and the implementation of the revised rules.

The government estimates that patients could save approximately ₹2,500 crore each year, but the actual impact will become measurable only after the policy takes effect.

For now, the key developments to watch are the expert committee’s recommendations, publication of the final list of medicines and formal notification of the new pricing rules.