India’s drug pricing authority has lowered the maximum allowed prices for 651 essential medicines by an average of 16.62 per cent, which offsets the 12.12 per cent annual increase allowed this year, the authority said on Monday.

The clarification from the National Pharmaceutical Pricing Authority (NPPA) came a day after Congress president Mallikarjun Kharge tweeted that the Narendra Modi government had raised the prices of over 1,000 formulations of medicines by more than 11 per cent.

The NPPA said the Drugs Prices Control Order 2013 permits an annual increase in drug prices based on the wholesale price index (WPI), which for 2022 was set by the government at 12.12 per cent, allowing manufacturers to increase prices within this limit from April 1 this year.

After the Union health ministry revised its list of essential medicines in 2022, the NPPA had launched an exercise to revise the maximum prices, or so-called ceiling prices. Of the 870 essential medicines, 651 now have new ceiling prices, resulting in an average decrease of 16.62 per cent, the NPPA said.

“This means the increase in the prices of essential medicines due to WPI from April 1 2023 will be offset by the average reduction in the valid ceiling prices of 651 essential medicines,” the NPPA said.

“The approved ceiling price of medicines has decreased by an average 16.62 per cent. As a result, consumers will save an estimated Rs 3,500 crore annually,” Union health minister Mansukh Mandaviya tweeted on Monday.

The NPPA has illustrated the impact of the price revisions through the examples of a few common drugs – paracetamol, used to treat fever; metformin, used to treat diabetes; and telmisartan, used to treat high blood pressure.

The ceiling price for a 500mg paracetamol tablet in April 2022 was Rs 1.01. This has been revised to Rs 0.80 and increased to Rs 0.89 from April 1 this year, resulting in a net price decrease of 11.88 per cent.

The ceiling price for a 500mg metformin tablet has fallen by 5.63 per cent — from Rs 2.13 in April 2022 to Rs 2.012 on April 1 this year, while that for a 40mg telmisartan tablet is down 7.65 per cent from Rs 7.32 to Rs 6.76.