Cancer drugs may get up to 70% cheaper as govt fixes trade margins
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The government has announced a cap on trade margins for non-scheduled anti-cancer drugs at 30%. This move is expected to lower the prices of cancer medications by 20 to 70%. Officials anticipate substantial annual savings for patients reaching approximately ₹2,500 crore. The initiative aims to enhance affordability and accessibility while curbing excessive trade markups. Concerns have been raised regarding the effectiveness of such measures in making treatments affordable.
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Loading...×New Delhi: The government has decided to cap trade margins on non-scheduled anti-cancer drugs at 30%, a move that could reduce the prices of several cancer medicines by up to 70% and save patients an estimated ₹2,500 crore annually, officials told ET.Following this, the department of pharmaceuticals asked the health ministry to constitute an expert committee to recommend the list of the medicines to be covered under the trade margin rationalisation (TMR) exercise.
The committee under the directorate general of health services (DGHS) is expected to submit its list by October 14, according to the minutes of a recent meeting at the National Pharmaceutical Pricing Authority (NPPA). "The positive list may be updated periodically based on market developments and public health considerations," the minutes showed.
The cap will apply to branded and generic drugs, domestic and imported products, and patented as well as non-patented medicines, officials ET spoke with said.
Also Read: Govt set to cap trade margins on more cancer drugs before SC hearing
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As part of the measure, manufacturers of the covered medicines will be required to maintain their current production levels to ensure that supplies of these life-saving drugs are not disrupted. Since the move only regulates the trade margin, manufacturers' selling prices and revenues will not be affected, the officials explained.
To be sure, the MRP is set by the manufacturer or marketing company. They are expected to bring it down as the new rule limits the share that can accrue to the trade. The 30% cap translates into a trade margin of 42.86% on the price to the stockist.
The government decision comes days after the Supreme Court raised concerns over the pricing of cancer medicines and questioned the Centre over a drug reportedly supplied to retailers for around ₹2,700 but sold at MRP of ₹27,000.
Extraordinary Circumstances
The minutes of the NPPA meeting said the authority "deliberated upon the need to address excessive trade markups in non-scheduled anti-cancer medicines" and observed that "extraordinary circumstances warrant intervention under Paragraph 19 of DPCO, 2013 in public interest".Paragraph 19 of the order empowers the government to fix the ceiling or retail price of a drug in extraordinary circumstances and in public interest. The authority observed that "extraordinary circumstances existed" to address market distortions, curb profiteering and ensure fair and affordable prices.
Also Read: Cancer drug costs Rs 2,700, sells for Rs 27,000: SC questions 10x markup at hospitals
An NPPA analysis found that non-scheduled anti-cancer medicines carry an average trade markup of around 170%, with the margin on some drugs going up to 700%. The minutes also noted substantial variations in transaction prices across retail, hospital and e-pharmacy channels, including significant differences in discounts from MRP.
"The authority accordingly noted that high trade margins, particularly in non-scheduled anti-cancer formulations, are a significant factor contributing to the high prices of such medicines," according to the minutes.
The NPPA expects the proposed intervention to reduce the MRP by broadly 20-70%, depending on the existing trade structure and markup of individual medicines, and estimates annual savings of around ₹2,500 crore.
The authority said the move would help reduce patients' out-of-pocket expenditure, improve affordability and accessibility, curb excessive trade markups and increase transparency in prices applicable to patients. Officials said patients bear nearly 75% of cancer treatment costs out of pocket.
The Working Group on Access to Medicines and Treatments (WGAMT), a civil society networking working for affordable healthcare in India, however, said the 30% trade margin cap would not make non-scheduled cancer medicines affordable, arguing that such a capping in 2019 didn't help much.
For instance, the margin on ribociclib was capped at 30% in 2019, but its monthly cost rose from ₹58,000 in 2022 to ₹78,000 in 2025, WGAMT co-convenors Jyotsna Singh and KM Gopakumar said. Pembrolizumab (Keytruda) still costs around ₹1,95,000 per vial, they added.
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( Originally published on Oct 08, 2026 )Read More News ondrug price controlcancer druganti cancer drugDGHS
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Figures reflect the source report and its stated period. This article is for information and is not investment advice.
