Para 1.10.7 - Medicine Procurement | KartavyaDesk

Original Rule Text

i) Pharmaceuticals Purchase Policy in respect of 103 (one hundred and three) medicines, originally valid for a period of five years, has now been renewed and extended21 till the final closure/ strategic disinvestment of the Pharma PSEs mentioned below. ii) Pharmaceuticals Purchase Policy will extend only to Central Public Sector Enterprises (CPSEs) under the administrative control of the Department of Pharmaceuticals, such as Indian Drugs and Pharmaceuticals Limited (IDPL), Hindustan Antibiotics Limited (HAL), Bengal Chemicals and Pharmaceuticals Limited (BCPL), Karnataka Antibiotics and Pharmaceuticals Limited (KAPL) and Rajasthan Drugs and Pharmaceuticals Limited (RDPL) and their subsidiaries where Government of India owns 51% (fifty-one per cent) or above shares. iii) This would be applicable to purchases by Central Government Departments, their Public Sector Undertakings, Autonomous Bodies, etc. This would also be applicable to the purchase of medicines by state governments under health programmes funded by the government of India, such as the National Rural Health Mission. iv) The pricing of the products would be done by the National Pharmaceutical Pricing Authority (NPPA) using the cost-based formula, as mentioned in the Drugs Price Control Order, 1995. A uniform discount of 16% (Sixteen per cent) would be extended to all products. All the taxes, whatsoever, would have to be passed on to buyers. v) Annual revision of prices would be linked to the Wholesale Price Index as per provisions contained in the Drugs Prices Control Order, 2013. vi) The procuring entity would purchase from pharma CPSEs and their subsidiaries subject to their meeting Good Manufacturing Practices (GMP) norms as per Schedule 'M' of the Drugs & Cosmetic Rules. vii) In case pharma CPSEs and their subsidiaries fail to supply the medicines, the procuring entity would be at liberty to make purchases from other manufacturers. If the pharma CPSEs or their subsidiaries fail to perform as per the purchase order, they would also be subject to payment of liquidated damages or any other penalty as per the terms of the contract. viii) The list of medicines (please refer to Annexure 29) may be reviewed and revised by the Department of Pharmaceuticals as per requirement.

What This Means

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Key Points

• •Prioritizes medicine purchases from specific Central Public Sector Enterprises (CPSEs) under the Department of Pharmaceuticals.
• •Applies to Central Government Departments, PSUs, Autonomous Bodies, and state governments using central funding for health programs.
• •Prices are determined by the National Pharmaceutical Pricing Authority (NPPA) using a cost-based formula with a 16% discount.
• •CPSEs must meet Good Manufacturing Practices (GMP) standards.
• •Procuring entities can buy from other manufacturers if CPSEs fail to supply.

Practical Example

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.

Frequently Asked Questions

This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.