Since over a decade, some pharma trade organizations operating in India, have been advocating for a separate regulatory policy for ‘Over The Counter (OTC)’ drugs, which can be legally sold without any medical prescriptions. Such a new policy initiative, if taken by the Indian Government, would call for inclusion of a separate Rule and a Schedule in the Drugs and Cosmetics Act, 1940 and Drugs and Cosmetics Rules, 1945.
In the midst of cacophony related to Intellectual Property (IP) related priority of the industry in multiple areas, OTC drug advocacy took a back-seat, temporarily. Some recent developments indicate, it has again been taken out of the trade associations’ archive, well-dusted, rehashed and re-presented. Today’s key driver is likely to be increasingly stringent drug price control measures of the government. An emphatic demand of the pharma trade associations that OTC drugs should be kept outside drug price control measures, vindicates this point.
In this article, I shall deliberate this issue, especially on raising the same old demand – yet again, and my concerns on the demand of free-pricing for essential OTC drugs, in the Indian context.
OTC drugs – no legal status in India:
Currently, OTC drugs have no legal status in India. However, those drugs which don’t feature under ‘prescription only’ medicines are construed as ‘non-prescription’ drugs and sold over the counter at pharma retail outlets.
Neither is there any concept currently existing in India, which is similar to ‘prescription only to OTC drug switch,’ unlike many developed countries, such as UK, EU and United States. Thus, before proceeding further, let me deliberate on the important point – why is ‘prescription only drug’ to ‘OTC drug’ switch. Let me briefly dwell on this issue, quoting from a neutral source – the World Health Organization (W.H.O).
‘The basic purpose of re-designation of a drug as an OTC product is commercial’:
The Essential Medicines and Health Products Information Portal – A World Health Organization resource illustrates the point as: After a new drug has been in use as a prescription-only medicine (POM) for an agreed period after licensing – usually five years – and has proved to be safe and effective during that time, regulatory authorities are prepared to consider submissions for re-designating the product where appropriate so that it becomes available for non-prescription “over the counter” (OTC) use.
The article further states: “The basic purpose of re-designation of a drug as an OTC product is frankly commercial; the manufacturer requests the change in the hope that, without the need for a prescription, the sale of the drug will increase. However, the change also has a secondary effect in that the drug will no longer – at least in its OTC form – be primarily funded by a national health system or insurance fund; if he had obtained the drug by private purchase, the patient will pay for it in cash, and this will therefore result in cost savings to the health system.”
Benefits of OTC drugs to patients in the western world:
An article titled, ‘When Rx-to-OTC Switch Medications Become Generic’,published in the U.S. Pharmacist on June 19, 2008, highlights the key benefits of generic OTC drugs to patients, mostly in the western world as follows:
- Prices for generic OTC versions are lower than those for the branded products.
- The savings vary from product to product, but they can be as little as 11 percent (some omeprazole generics) to over 75 percent (some loratadine generics).
- The cost savings can be critical in making self-care decisions.
- For patients with a chronic, self-treatable medical condition, the addition of a new generic OTC with that indication expands the range of therapeutic options.
Endorsing the point that ‘OTC drug’ cost significantly less than the ‘prescription only drug’ other studies also point out the following:
- Less lost work time and costs saved by not needing to visit a doctor are important considerations.
- Growing sophistication and self-reliance among consumers, with increasing interest in and knowledge about appropriate self-medication.
- Older adults in particular tend to experience increased minor medical problems, such as arthritis, sleeping difficulties, muscle aches and pains, headaches and colds. Thus, as the population ages the demand for non-prescription drugs escalates.
To illustrate the point of greater choice to patients, the article cited an example of allergic rhinitis patients. It pointed out that at one time, such patients had little to choose from other than older (first-generation) antihistamines. When loratadine (Claritin) and cetirizine (Zyrtec) switched from ‘prescription only’ to generic OTC drugs, price-conscious patients got the expanded option to choose from them based on their unique advantages and lower prices.
Benefits of OTC drugs for drug manufacturers:
Several studies concluded the following when it comes to benefits of OTC drugs for the drug manufacturers:
- When an innovative drug loses patent protection, expanding into OTC segment with the same product can help a lot in the product life-cycle management.
- Additional revenue with OTC drugs help increasing the concerned company’s both top and the bottom-lines.
Does ‘only prescription drug’ to ‘OTC drug’ switch help Indian patients?
The key benefit that patients derive out of any switch from ‘prescription only drug’ to ‘OTC drug’ switch, has been shown as cheaper price of generic OTC drugs. In India that question doesn’t arise, because an ‘OTC generic drug’ can’t possibly be cheaper than ‘prescription only generic drugs’ of the same molecule. On the contrary, if the demand for putting generic drug outside price control is implemented, it would likely to make ‘OTC generic essential drugs’ more expensive- increasing already high out of pocket (OOP) drug expenses, without benefitting patients, tangibly.
How would OTC drugs help patients in India?
According to reports, pharma trade associations claim that ‘OTC drugs will help Indian patients. Some of the reasons given by them are as follows:
- Responsible self-medication: Empowers patients to make responsible and wise choices and self-manage their health outcomes.
- Improves access to medicines: ‘Access to medicines’ in India has long ignored the critical role of the viability of OTC medicine, which could play a critical role in improving access to medicines in India, especially in the remote areas.
- Help both health system and consumers saving money: OTC medicines save health systems valuable resources and can save consumers time and money.
While the basic purpose of re-designation of a drug as an OTC product is commercial – as articulated in the above article of the W.H.O, it is interesting to note, how it is being camouflaged in India by a trade association. The association demands a brand new OTC drug regulatory policy without any price control, and at the same time says, ‘the patient is at the core of all our activities.’ I wonder how – by increasing the burden of OOP drug expenses for patients? Let me try to fathom it raising some basic questions, in context.
Some basic questions:
While trying to understand each of the above three ‘patient benefits with OTC drugs’, as highlighted by the pharma trade association, I would strive to ferret out the basic questions in this regard, as follows:
- Responsible self-medication:Fine. But again, won’t it make totally price and promotion deregulated OTC drugs more expensive than the existing equivalents of essential drugs – significantly increasing OOP for patients?
- Improves access to medicines: Improving drug access comes with increasing affordability, especially in India. With OTC drugs being presumably higher priced than other generic equivalents, how would it improve access? Just to illustrate this point, one pharma trade association has cited examples of the following drugs, for inclusion in the OTC category:
“Paracetamol, Aspirin, Antacids, Topical preparations of certain NSAIDs (Ibuprofen, Diclofenac), Cetirizine, Albendazole, Mebendazole, Povidone‐Iodine preparations, Ranitidine, Ibuprofen (200mg), Normal saline nasal drops, Xymetazoline nasal drops, etc. In addition to all Drugs which are currently under Schedule K.”
If the prices of OTC versions of the above drugs are kept more than the prevailing ceiling prices for essential, would it benefit the patients and improve access to these drugs for them?
- Help both health system and consumers saving money: Doesn’t the same reason hold good for this one too?
One may also justifiably ask, why am I presuming that OTC drug prices will be more than their non-OTC equivalents? My counter question will be, why is the demand for total regulation of price for OTC drugs? In any case, if a non-schedule drug is included in the OTC category, the question of any price control doesn’t arise in any way.
The current status in India:
Unrestricted sale of ‘prescription only drugs’, including all antibiotics and psychotropic drugs, is rampant in India, causing great harm to the Indian population. In tandem with strict enforcement of the drug dispensing rules in India, a separate patient-friendly category of OTC drugs would certainly help significantly. As a concept, there is no question to it. But the devil is in the detail of demand for the same.
Accordingly, in November 2016, the Drugs Consultative Committee (DCC) formed a sub-committee for charting a regulatory pathway for sale of OTC drugs in India, specifying punitive measures for any violation of the same. As I indicated above, currently, any drug that doesn’t not fall under a prescribed schedule could be sold and purchased without a medical prescription. This panel has sought all stakeholders’ comments and suggestions on the same. Some of the responses from pharma trade associations, as requested for, I have deliberated above. Nevertheless, the bottom-line is, nothing tangible in this regard has happened till date.
As I envisage – if, as and when it happens, it is also likely to have an adverse impact on the sales and profits of many pharma players. This is primarily because, indiscriminate drug use – irrespective of self-medication or irrational prescription, do fetch good sales for them. But it shouldn’t continue any more – for the benefit of patients.
More importantly, the key argument showcased in favor of OTC drugs in India, seems to be a borrowed one – borrowed from a totally different pharma environment of the western world. Out of Pocket drug expenditure for patients, which is already very high in India, shouldn’t be allowed to go further north. Some of the India-specific intents of pharma trade associations also appear blatantly self-serving, such as total deregulation of price and promotion. It rekindles huge concerns, such as:
- What could possibly be the key intent behind keeping essential OTC drugs outside existing price control?
- If so, won’t it open yet another floodgate of hoodwinking price regulation of ‘essential drugs’ through crafty manipulations?
It would be a different matter though, if such OTC drugs do not fall under ‘essential drugs’ category.
Thus, in my overall perspective – ‘no price control for OTC drugs’, is an interesting demand of pharma players, but not surprising in any way – at all.
By: Tapan J. Ray
Disclaimer: The views/opinions expressed in this article are entirely my own, written in my individual and personal capacity. I do not represent any other person or organization for this opinion.