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Karnataka flags 52x mark-up on cancer drugs

By Sohail Khan 1 October 2026, 12:57 pm

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Business News›Industry›Healthcare/Biotech›Healthcare›Karnataka flags 52x mark-up on cancer drugs, seeks Centre's intervention

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Karnataka flags 52x mark-up on cancer drugs, seeks Centre's intervention
Synopsis

Karnataka conducted inspections revealing significant price disparities between hospital procurement and patient billing for cancer drugs and medical devices. The state government has urged the Centre to implement transparency in pricing and regulate trade margins for essential medicines. Mark-ups observed ranged from 10 to over 52 times the actual procurement costs for various items.

Pharmacists said the drugs seized are primarily used for critical care, including in ICUs, CCUs and cancer centres, and are commonly not available at retail pharmacies. — Novartis and Eli Lilly are opposing a Kerala HC plea for cheaper breast cancer drugs as court submissions highlight the wide gap between their India prices, manufacturing costs and global sales.

Karnataka has sought urgent intervention from the Centre to address excessive mark-ups on cancer drugs, high-value medicines, medical devices and hospital consumables, following inspections that revealed a wide gap between hospitals' procurement costs and the prices charged to patients.

According to an official release from the Commissioner for Food Safety and Drug Administration, the issue was brought to the attention of the Union Ministry of Health and Family Welfare and the National Pharmaceutical Pricing Authority (NPPA) after inspections at hospitals, including those providing cancer treatment, uncovered significant pricing disparities.

Health and Family Welfare Minister UT Khader, in a letter to the Union Health Minister, called for national-level measures to curb what the state termed exorbitant patient billing arising from medicines, medical devices and consumables procured by hospitals at heavily discounted institutional rates but billed to patients at or near the Maximum Retail Price (MRP).

Investigations by the Karnataka Food Safety and Drug Administration found that pharmaceutical companies were supplying several medicines to hospitals at deeply discounted institutional prices, while patients were being billed at or close to the printed MRP. The department said the resulting mark-ups ranged from 10 times to more than 52 times the actual procurement cost.

The state government identified pricing anomalies in 253 drugs and consumables during its inspections. Among the cases cited were Gufipol (Criticare), which was procured at a landing cost of Rs 86 but carried an MRP of Rs 4,528, representing a mark-up of 52.6 times; Guficycline-50 Injection (GUFI), procured at Rs 160 and carrying an MRP of Rs 7,110, a mark-up of 44.4 times; and Terlitis (AEQU), supplied at Rs 118 but sold at an MRP of Rs 4,416, translating into a mark-up of 37.4 times.

The inspection also found substantial price differences in several high-value cancer therapies. Taxocare 120 mg was procured at around Rs 1,000 against an MRP of Rs 21,617, while Canmab 440 mg had a landing cost of Rs 6,600 compared with an MRP of Rs 57,457. Bevatas 400 mg Injection, another high-value oncology drug, was supplied at Rs 5,850 against an MRP of Rs 62,690. Cytax 100 mg, a cancer drug, was procured at Rs 342 but carried an MRP of Rs 3,836.

The disparities were not limited to medicines. The department found that an adult nebuliser mask procured at Rs 44.50 carried an MRP of Rs 950, while an IV set purchased at Rs 14.75 had an MRP of Rs 295.

Officials said such pricing practices significantly increase the financial burden on patients, particularly those undergoing long-term treatment for cancer and other serious illnesses.

Acting on the minister's directions, Drugs Enforcement Officers of the Food Safety and Drug Administration Department conducted a fresh verification drive on September 25 and 26 across wholesale drug establishments, hospitals and other healthcare facilities in Bengaluru and several districts.

Preliminary findings from the latest inspections revealed substantial differences between landing costs, MRPs and actual sale prices at different stages of the supply chain for certain high-cost medicines, medical devices and hospital consumables. The exercise covered more than 768 consumable items and 189 high-cost drugs. The findings will be submitted to the Central government for further examination, the release said.

The Karnataka government has urged the Centre to mandate transparency in institutional pricing by requiring hospitals to disclose both the landing cost and MRP on patient bills. It has also sought the expansion of medicines covered under the Drug Price Control Order (DPCO), regulation of trade margins on essential high-value medicines and consumables, constitution of an inter-ministerial expert group, a national study on institutional procurement and patient billing practices, amendments to the Drugs (Prices Control) Order, 2013, rationalisation of trade margins, mandatory cost-to-MRP transparency, expansion of the National List of Essential Medicines, inclusion of all forms of backend incentives and discounts as part of acquisition costs, and the creation of a dedicated audit and enforcement mechanism.

According to the state government, current regulations leave significant gaps in oversight. While scheduled drugs covered under the DPCO are subject to ceiling prices fixed by the NPPA, non-scheduled drugs are not subject to caps on retailer margins. Many medical devices and consumables also fall outside comprehensive price control mechanisms, while hospital pharmacies are not specifically required to pass on institutional discounts to patients.

The Food Safety and Drug Administration Department said it would continue the verification exercise in phases. The next round of inspections will focus on anti-retroviral medicines, higher-generation and critical antibiotics, medical devices and hospital consumables that have a substantial financial impact on patients.

The government has also called upon hospitals and pharmaceutical establishments to ensure greater transparency in billing and provide patients and their families with adequate information about the medicines, devices and consumables used during treatment.

"Affordability of essential and life-saving healthcare is a matter of serious public importance," the release said, adding that the Karnataka government would continue to take measures within its jurisdiction to protect patients from unjustified financial burdens while ensuring access to quality healthcare.

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