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First step need to take For Starting a Pharmaceutical Company

Query: I am a veterinarian by profession. Have been going through your website from past 1 year and have planned now to give a start to my own pharma company. Please let me know what will be the first step I need to take.  Answer: First Step you need to prepare yourself for Pharmaceutical Company:  Preparation means Choose marketing type, Choose molecules want to launch, Location where you want to launch product, Choose Company, Products Name, Budget available...  Choose marketing type: As number of marketing and selling types present in pharmaceutical market. i.e. Branded Marketing , Generic Marketing , OTC Marketing, Franchise Marketing etc. You need to select any one from above.  Choose Molecule: Once you have selected which marketing type is best suitable for you then you need to select at which segment and molecules you want to work. Check out: How to choose products/service for business? Location: You can't launch your pharmaceutical company all over India or at broad area.

Drug Price Control Order (DPCO)

Drug Price Control Order (DPCO) is an order issued by center government under the essential commodities act which enables NPPA (National Pharmaceutical Pricing Authority) to fix ceiling price of essential and life saving medicines to ensure these medicines at affordable price to general public.

Price control over drugs was first introduced in India as Drug (Display of Prices) Order, 1962 and the Drug (Control of Prices) Order, 1963. After that Drugs (Price Control) Order of 1966, Drugs (Price Control) Order of 1970 - issued under the "Essential Commodities Act, 1955, Drugs (Price Control) Order 1979 (following the Drug policy, 1978), Drugs (Price Control) Order of 1987 (following the Drug policy, 1986). These policies were based upon the principle of effective control over prices of essential drugs and later bulk drugs as well as availability of drugs.

After that Drug policy of 1994 were implemented through Drugs (Price Control) Order, 1995. The control over prices was to be on the basis of cost of production with allowance being given for post production expenses. As per the criteria of 1994 policy, a list of 74 bulk drugs was identified and these drugs as well as formulation based on these drugs were brought under the price control regime.

After that a new pharmaceutical pricing policy was introduced in the year 2002 but never implemented and the 1994 drug policy continued to be applicable.

There was need of enabling industry growth with attendant socio, economic benefits along with balancing the declared objective of providing better health care including making available essential medicines at reasonable prices to all. The Drug Policy, 1994 needs to be revised to meet the challenges brought about by the competitive international pharmaceutical industry in a globalised economic environment, as much as meeting the country's requirements for safe and quality medicines at reasonable prices. Therefore, the Government introduces the National Pharmaceuticals Pricing Policy, 2012. NPPA, 2012 replaced the Drug Policy, 1994.

The regulation of price under NPPA, 2012 is on the basis of regulating the price of formulation through Market based Pricing (MBP) which is different from drug policy, 1994 which was on Cost Based Pricing (CBP) basis. The formulation is regulated by fixing a ceiling price (CP). Ceiling price of any formulation is fixed by taking simple average price of all brands of that formulation having equal to or more than 1% market share of the total market share of that formulation.

Key Principles Of National Pharmaceuticals Pricing Policy 2012:
The key principles for regulation of prices in the National Pharmaceuticals Pricing Policy 2012 are:

(1) Essentiality of Drugs
(2) Control of Formulations prices only
(3) Market Based Pricing

On the basis of NPPA, 2012, a new Drug (Price Control) Order, 2013 was implemented and are in effect till date.



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