The National Pharmaceutical Pricing Authority has stepped in to keep medicines affordable following the implementation of the Goods and Services Tax regime from July 1, reported Business Standard on Wednesday.

The pharmaceuticals industry had feared a major rise in prices under the new GST regime, as around 80% of drugs were put in the 12% tax bracket, up from the 9% which is levied on them currently.

To lower drug prices, the NPPA has thus notified new maximum prices for 761 drugs part of the Drug Price Control Order, by removing the excise duty on these medicines, reported The Economic Times. After this move, the prices of drugs after GST rollout will only be marginally higher than before.

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The NPPA notification would mean lower prices of drugs to treat HIV, cancer, Crohn’s disease, pneumonia, and skin-related ailments among others. For example, the price of anti-cancer drug Bortezomib has been brought down to Rs 11,160 from Rs 11,637 for a packet of injection powder. Off-the-counter medication like paracetamol has also seen a small reduction in prices.

However, these prices do not take into account the GST. The list of drugs has deducted excise duty and VAT from the existing ceiling prices. Pharamaceutical companies believe that while the ceiling price for these medicines has reduced, adding the GST element to the new ceiling price will make medicines slightly more expensive than before.

Under the GST regime, the prices of stents, immunosuppressants and drugs to treat leukaemia and Hepatitis B have not been increased. While most of the medicines will fall under the 12% GST bracket, certain life-saving drugs are in the 5% tax slab under the new regime.

But the industry is worried about nicotine gum being placed in the 18% bracket. Cipla, which manufactures one such gum, has sought a revision in the GST slab for it.