India medicine margins beyond cancer treatments are under government review, the Department of Pharmaceuticals told the Supreme Court in an affidavit filed on October 12, 2026. The government has decided to cap trade margins on anti-cancer drugs at 30% of maximum retail price, but has not announced additional categories or a timeline for further action.

Key Takeaways

  • The government is examining other high margins and pricing practices in consultation with stakeholders.
  • It expects the cancer-drug cap to lower maximum retail prices by roughly 20% to 70%, with annual patient savings of about ₹2,500 crore.
  • The government said a uniform percentage margin for hospital consumables would not work because products and hospital billing practices vary.

Why India medicine margins are being examined

The affidavit was filed in a petition brought by Dr Sanjay Kulshrestha. The department said patients have less information and bargaining power than hospitals, doctors and pharmacies, creating opportunities for malpractices despite competition among drug manufacturers.

The government said hospitals buy medicines from manufacturers offering the highest trade margins and sell them to patients at the maximum retail price, or MRP. It put oncology margins at 170% to 700% or more and said margins on hospital consumables commonly range from 100% to 1,000% or more.

Supplies are included in negotiated package rates under government schemes and insurance, the affidavit said, while patients paying directly are billed separately at MRP.

Cancer-drug cap and expected savings

The government said its 30% cap is intended to prevent excessive trade margins while retaining a reasonable margin. It is not directly reducing manufacturers’ selling prices. The projected price reductions and annual savings are estimates, not results.

A 2019 notification capped margins on 42 non-scheduled anti-cancer drugs. The affidavit said that exercise lowered the MRPs of 526 brands and saved about ₹984 crore a year.

Why broader limits need consultation

The government said higher margins can be justified for some products, including low-value or slow-moving medicines, drugs sold in rural markets and products requiring cold-chain storage or fragile packaging.

Hospital consumables range from very cheap items to products costing ₹350 or more, while nursing and administrative billing varies by hospital, the affidavit said. Those differences mean setting a margin requires extensive consultation.

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