India proposes 30% cap on trade margins for listed anti-cancer drugs

The Centre has formally proposed capping trade margins on listed anti-cancer drugs at 30% of their maximum retail price, a step intended to curb excessive mark-ups across the supply chain. Officials estimate that the cap could reduce retail prices by up to 70% and save consumers an estimated ₹2,500 crore each year. A committee under the Directorate General of Health Services is tasked with identifying which drug brands will be subject to the limit, having observed that current margins can reach as high as 700% at certain retail points.

This proposal follows a 2019 initiative that imposed margin caps on 42 cancer drugs, delivering annual savings of about ₹984 crore across 526 brands. The government views the cap as the first phase of a broader trade-margin rationalisation framework, which could eventually encompass other non-scheduled pharmaceuticals, consumables, and devices such as IV kits and catheters. The Department of Pharmaceuticals and the National Pharmaceutical Pricing Authority are consulting industry stakeholders as part of this effort, though no timeline has been set for wider implementation.