Karnataka flags 52x markup on cancer drugs; seeks Centre's help
Karnataka government seeks central intervention after finding cancer drugs billed at 52 times their actual cost to patients.
The Karnataka government has raised a red flag over massive pricing discrepancies in life-saving medicines, revealing that some cancer drugs and medical consumables are being sold to patients at markups as high as 52 times their actual procurement cost.
Following alarming findings from recent hospital inspections, the state has formally requested the Central Government to intervene and take national action against these exorbitant billing practices that place an immense financial burden on patients.
Shocking price gaps uncovered in hospital inspections
Investigations conducted by the Karnataka Food Safety and Drug Administration have exposed a disturbing pattern: pharmaceutical companies provide high-cost drugs to hospitals at heavily discounted institutional rates, yet hospitals bill patients at or near the Maximum Retail Price (MRP). This gap has resulted in price hikes ranging from 10 to over 52 times the landing cost.
In a move to address this crisis, the Minister for Health and Family Welfare has written to the Union Health Minister, seeking urgent national measures to curb unjustified patient billing.
Key findings from the verification drive
A special verification drive led by FDA Drugs Enforcement Officers on September 25 and 26, 2026, across Bengaluru and various districts in Karnataka, yielded the following details:
- Scope of Inspection: Officials examined 189 high-cost drugs and 768 consumable items.
- Anomalies Identified: A list of 253 specific drugs has been compiled where extreme pricing irregularities were found.
- Pricing Disparity: Preliminary data shows substantial differences between the landing cost, the actual sale price, and the printed MRP.
Demands for transparency and regulatory reform
The Karnataka government has proposed a comprehensive list of demands to the Centre to protect citizens from financial exploitation. These include:
- Mandatory Transparency: Requiring hospitals to display both the landing cost and the MRP on all patient bills.
- Price Control Expansion: Expanding the list of drugs under the Drugs Price Control Order (DPCO) and regulating trade margins on essential high-value medicines.
- Regulatory Amendments: Amending the DPCO 2013 and rationalizing trade margins to ensure discounts are passed on to patients.
- Institutional Oversight: Creating an inter-ministerial expert group and a national data study to investigate these trends.
- Audit Mechanisms: Establishing strict audit and enforcement mechanisms to monitor hospital pharmacies.
The loophole in current pricing regulations
Currently, the regulatory framework leaves significant gaps that allow for such markups. While the National Pharmaceutical Pricing Authority (NPPA) sets ceiling prices for scheduled drugs under the DPCO with a 16 per cent retailer margin, non-scheduled drugs have no cap on retailer margins. For these, the only limit is the MRP printed by the manufacturer.
Furthermore, medical devices and most consumables fall outside the DPCO, and there is currently no specific regulation mandating that hospitals pass institutional discounts through to the end consumer.
Next steps in the investigation
The Department of Food and Drug Administration has stated that this verification exercise will continue in a phased manner. The next phase of inspections will specifically target:
- Anti-retroviral drugs.
- Critical antibiotics and higher-generation antibiotics.
- Medical devices and hospital consumables with high financial implications for patients.
The Commissioner of the Food and Drug Administration emphasized that the affordability of life-saving healthcare is a matter of serious public importance, and the state will use all available legal jurisdictions to protect patients from unjustified financial burdens.