Centre Limits Trade Margins To 30% For 137 Non-Scheduled Cancer Medicines

Summary:
The Centre has capped trade margins at 30% for 137 non-scheduled anti-cancer medicines to reduce treatment costs and improve affordability, with the revised prices taking effect from November 9, 2026. The NPPA said the measure could reduce the maximum retail prices of some medicines by up to 70%, potentially saving patients around Rs 2,500 crore annually. Manufacturers must publish updated prices and maintain supply, while hospitals, retailers and state drug controllers will help ensure compliance. The move marks an initial step towards broader trade margin regulation amid concerns over excessive mark-ups on essential medicines. 

The Centre has introduced a 30 per cent cap on trade margins for 137 non-scheduled anti-cancer medicines to bring down oncology drug prices and make treatment more affordable for patients.

The National Pharmaceutical Pricing Authority (NPPA) stated that the list covers patented and non-patented medicines, following recommendations from an expert committee established under the Directorate General of Health Services (DGHS).

The decision was announced through a gazette notification dated 17 October and covers cancer drugs such as Nivolumab, Olaparib, Denosumab and Topotecan. However, the margin restriction will not cover medicines supplied to individual patients through pharmaceutical companies’ Patient Assistance Programmes (PAPs).

The revised prices will take effect from 9 November 2026.

Trade Margin Restricted To 30%

According to the minutes of the NPPA’s 284th meeting held on 16 October, the authority approved a trade margin limit of 30 per cent of the maximum retail price (MRP), excluding GST. This is equivalent to a 42.86 per cent mark-up on the Price to Stockist/Price to Distributor (PTS/PTD).

The NPPA said the measure seeks to ensure fair margins for traders while curbing excessive mark-ups on cancer medicines.

Depending on current pricing arrangements, the intervention could lower the MRPs of the selected non-scheduled anti-cancer drugs by as much as 70 per cent. The government expects the measure to help patients save approximately Rs 2,500 crore annually.

Drug manufacturers must publish updated price lists on their websites and share them with retailers and hospitals. They are also required to submit the revised prices to the NPPA within seven days of the gazette notification’s publication.

Hospitals, Retailers Responsible For Compliance

The government has assigned hospitals and medical institutions a role in monitoring the MRPs of the affected medicines, as a significant proportion of anti-cancer drugs is supplied directly to healthcare institutions.

State drug controllers have been instructed to take appropriate action to ensure that manufacturers, distributors, retailers, hospitals and medical institutions comply with the order.

Pharmaceutical companies must also maintain their existing production and supply volumes for the notified medicines to prevent disruptions in availability for patients.

Companies found violating the order may be directed to repay the excess amount charged, along with interest, under the Drugs (Prices Control) Order (DPCO), 2013, read with the Essential Commodities Act, 1955.

Initial Move Towards Broader Trade Margin Regulation

Officials had previously stated that an expert committee identified trade margins ranging from 170 per cent to 700 per cent for certain non-scheduled cancer medicines across different outlets.

Non-scheduled drugs are formulations that fall outside the price ceilings established under the DPCO, 2013. Manufacturers of these medicines are currently permitted to raise prices by up to 10 per cent over a rolling 12-month period.

Non-scheduled medicines represent an estimated 82 per cent of India’s domestic pharmaceutical market, making the regulation of trade margins a potentially far-reaching policy measure.

The decision is considered an early step towards wider trade margin rationalisation (TMR). This approach regulates the price difference between what manufacturers charge distributors and the final amount consumers pay, instead of directly fixing a maximum price for each medicine.

In 2019, the Centre introduced trade margin limits for 42 cancer medicines, reportedly generating annual savings of around Rs 984 crore across 526 brands.

Officials have suggested that the government may eventually extend similar restrictions to additional non-scheduled medicines and medical consumables and devices, including IV kits and catheters. The development also comes as the Supreme Court examines concerns over high mark-ups on essential medicines. A Bench comprising Justices Vikram Nath and Sandeep Mehta has raised questions about the regulatory distinction between scheduled and non-scheduled medicines under the DPCO and whether drugs categorised as non-essential should continue to remain outside price-control mechanisms.