The government's efforts to curb the rising trend of pharmaceutical companies promoting their medicines by sponsoring trips and offering gifts to doctors seem to be bearing fruit.
Accepting that certain drug companies were indulging in this practice, as highlighted recently by TOI, the industry agreed on Tuesday to implement a code of ethics that bans unethical gifts in cash or kind to doctors.
At a meeting with pharmaceutical secretary, Ashok Kumar, company representatives said, within a month, they would frame a uniform code of ethics for the sector that will be followed by all drug companies and their associations.
They requested the government to refrain from any legal intervention and leave the matter to be sorted out by the pharma corporate bodies. On his part, Kumar highlighted the problem of "unethical practices" for marketing drugs and said that if nothing was done soon, the government would be constrained to legally intervene in order to curb the menace.
An official told TOI, "This is a corporate governance issue (for companies) and the government wants them to voluntarily tackle it. If companies are not able to curb unnecessary expenses, the government, if need be, can intervene and regulate these unethical trade practices."
During the talks, the representatives said that there should also be a code of conduct for medical professionals to follow. The companies represented at the meeting included Roche, Aventis, GSK, Ind-Swift, Lupin and Ranbaxy.
While industry body, Organization of Pharmaceutical Producers of India (OPPI), had drawn up a code of conduct for marketing drugs two years back, the Indian Pharmaceutical Alliance (IPA) and other associations will now frame formal ethical norms. If a member-company is found violating this code, punitive action will be taken against it, sources said.
IPA secretary general D G Shah told TOI that the association is in the process of formalizing these guidelines.
However, drug companies felt that their current promotional expenses were not excessive, and in fact, significantly lower than other industries. Companies spend 7-8% of their sales on promotions, which include gifts in cash or kind to doctors like sponsorships, entertainment and travel.
The government and company representatives will meet again in April to review efforts made by the industry to limit unethical trade practices. Companies dole out huge amounts in the form of freebies, gifts and jaunts to promote drugs so that doctors prescribe them. These promotional costs form a huge component in the price of a drug.
The government move comes even as several countries have already brought in legislation to curb unethical promotional expenses, which may influence doctors in their prescriptions.
However, sources point out that this problem, which has persisted for years, may not end easily as the government cannot directly determine prices of a large number of medicines. However, if a pharma policy which is under the government’s consideration is in place, it could bring under price control a wide range of essential and life-saving medicines.