The conversion costs, packaging charges and process loss of materials and packaging material costs are likely to be increased to give some relief to the pharma companies as the National Pharmaceutical Pricing Authority (NPPA) has initiated steps to garner inputs from the manufacturers for finalising the norms for the current year.
Though an annual exercise by the NPPA to revise the norms for CC, PC, PL and PM, the industry is hoping that the rates would be increased marginally this year in line with the changed economic scenario where input costs have gone up drastically over the past year. Last year, NPPA had revised the rates upto 9 per cent and this time around also, the industry associations are planning to pitch for a higher margin, it is learnt.
The NPPA has already sent letters to the industry associations and companies inviting suggestions in the stipulated format to revise the norms and will then hold its own studies in the market. The pricing agency last time revised the norms in August 2008.
These norms for CC, PC, PL & PM are to be worked out based on actual cost data / information received from various manufacturers & formulators. Industry associations have been requested to give wide publicity to their members about the study.
The pharma manufacturing units and companies have been requested to furnish the information / data to NPPA in a soft copy on Compact Diskette (CD) and a duly singed hard copy along with the copy of the Annual Report of the company for the last two years i.e. 2006-07 & 2007-08, NPPA said. It has also published the questionnaire to be filled by the associations and the companies.
"The data and information of any new product introduced with the technology & process of manufactured be intimated separately along with the detailed write up on the process involved. In case of any clarification, or doubt you may please contact the undersigned. Suggestions are also solicited to the Questionnaire for a suitable method of indexing the variable & major cost elements, which constitute CC & PC and the appropriate basis for indexing process losses," the NPPA communiqué said.
Last year conversion costs of tablets plain (per 100 nos) upto 100 mg was hiked up from Rs 7.26 to Rs 7.93 and in medium section (101 mg to 350 mg), the costs rose from Rs 10.51 to 10.99. In the large tablets section (351 mg to 600 mg), costs went up from Rs 17.68 to Rs 19.31.
Likewise, prices in the extra large section (601 mg to 900 mg); new price was Rs 22.78 against existing Rs 20.86. Similar hike is also affected in packaging charges and packaging materials too, while the percentage of loss of raw materials (other than packing materials in conversion and packing) and process loss of packing materials in packaging remained the same.