Private Hospitals Accused of Marking Up Medicine Prices Sharply

India's private healthcare sector has expanded to fill a gap created by chronic public under-investment. The National Health Policy, 2017 set a target of raising government health spending to 2.5% of GDP, but actual spending has stayed near 1.4% of GDP. This has pushed the majority of secondary and tertiary care into private hands. The right to health flows from Article 21, but health itself is placed in the State List under the Seventh Schedule. This means states carry the primary responsibility for organising and regulating health services, while the Union government's own price-control instruments cover only a limited slice of the market. This division explains why enforcement action against overcharging, such as Maharashtra's Food and Drug Administration orders, has come from a state regulator rather than the Centre.

The Union's main tools for regulating medicine prices are the Drug Price Control Order (DPCO), 2013 and the National Pharmaceutical Pricing Authority (NPPA), which fixes ceiling prices only for medicines on the National List of Essential Medicines. Presently, only around 18% of medicines sold in India fall under this statutory price control. A 2016 Department of Pharmaceuticals committee examined this gap and found that hospitals were free to fix maximum retail prices with almost no oversight. It recommended capping trade margins on all medicines and implants, whether price-controlled or not, between 35% and 50% depending on price slabs. A decade later, this recommendation remains unimplemented.