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INDIAN DRUGMAKERS PREPARE FOR NEW DRUG PRICING PLAN

August 3, 2006

The Indian Drugs Manufacturers Association (IDMA) has asked the government to notify it of the revised ceiling prices of drugs as soon as possible to help drugmakers prepare the inventory of packing materials for batches to be manufactured after Oct. 2 in compliance with the new tax plan.

In a memorandum to the Ministry of Chemicals & Fertilisers, the IDMA noted that according to the new rule, maximum retail price means the retail price arrived at or fixed in accordance with the provisions of the order and includes a ceiling price at which drugs may be sold to the consumer. The price and the words "Maximum/Max Retail Price Inclusive of All Taxes" must be printed on the packaging.

The IDMA has asked the government to reveal the new ceiling prices, for the new pricing scheme must take into consideration "all taxes local, or otherwise, including excise duty, sales taxes/value-added tax" and the varying sales taxes in different Indian states.