New Delhi: The Centre is weighing an emergency, one-time increase in prices of around 300 essential medicines as the West Asia war disrupts supplies of petrochemical-based pharmaceutical inputs and drives up manufacturing costs, according to two government officials and two industry executives.
The increase, which is being discussed between the National Pharmaceutical Pricing Authority (NPPA), the Department of Pharmaceuticals (DoP), and the commerce ministry, would be rolled back once supply chains stabilize, they said.
The medicines under discussion include antibiotics and anti-infectives (amoxicillin, azithromycin), cardiac drugs (amlodipine, atorvastatin), and analgesics (paracetamol), besides other essential and life-saving formulations such as steroids (dexamethasone) and vitamins (ascorbic acid) that are dependent on imported active pharmaceutical ingredients and petrochemical-based solvents.
“A proposal has come from the industry to the government regarding this pricing, and the government is reviewing the matter,” one of the two officials cited above said, requesting anonymity.
“Indian Drugs Manufacturing Association (IDMA) is in dialogue with the government for getting some temporary relief under Drugs Prices Control Order (DPCO), in order to ensure a balance between the industry concerns and patients’ needs,” said Dr. Viranchi Shah, national spokesperson and immediate past national president at IDMA, which has over 1,200 member companies.
The proposal would mark a rare intervention in India’s tightly regulated drug pricing regime and is aimed at preventing supply disruptions of critical medicines, the people cited earlier said.
Annual price increases for scheduled drugs are linked to the Wholesale Price Index (WPI), while non-scheduled medicines cannot see annual price hikes exceeding 10%. Scheduled drugs comprise the National List of Essential Medicines or NLEM, which was framed and released in September 2022 by the Union health ministry.
Prices of scheduled drugs were last raised 0.64956% on 1 April 2026 based on the calendar year 2025 WPI. Manufacturers said the increase was inadequate under current conditions and warned the government of potential supply disruptions and mounting stress on small and medium-sized drugmakers.
In a representation to the DoP during the third week of March, the Himachal Drug Manufacturers Association (HDMA) said prices of key inputs—including petrochemical feedstocks, solvents and raw materials such as propylene, ammonia and methanol—had risen by as much as 200-300% following supply disruptions linked to the West Asia conflict.
Himachal Pradesh is a pharmaceuticals manufacturing hub, housing approximately 700-800 active manufacturing units across industrial clusters like Baddi, Barotiwala, Nalagarh, and Kala Amb.
“Manufacturers are already overburdened with existing cash credit and cannot infuse any further capital into their operations,” HDMA president Dr. Rajesh Gupta said, adding that escalating raw material and packaging costs and consequent capital crunch among small and medium manufacturers have strained relationships between vendors and formulators.
In another representation to the DoP on 30 April, reviewed by Mint, HDMA said a minimum 10-20% increase in maximum retail prices (MRP) was urgently required to offset manufacturing cost escalation, and requested immediate regulatory intervention under emergency clauses. The association said prices of active pharmaceutical ingredients (APIs), key solvents and excipients had seen volatile domestic and import price increases of 50-150%.
The DoP declined to comment on the ongoing consultations, but said the National Pharmaceutical Pricing Authority (NPPA) regulates medicine prices under the Drugs Price Control Order (DPCO), 2013, which caps annual price increases for non-scheduled drugs at 10%.
The department added that NPPA can intervene under extraordinary circumstances and in public interest to ensure the availability of medicines at affordable prices. As of 18 March 2026, ceiling prices for 935 scheduled formulations and retail prices for 3,702 new drugs were in force.
Queries emailed to the spokespersons of the ministry of commerce and industry, NPPA, Sun Pharma, Cipla, Mankind, Dr. Reddy’s Laboratories, and Zydus Life Sciences on 18 May remained unanswered till press time.
Pointing to the pressure on the pharmaceutical and specialty chemicals ecosystem from the West Asia conflict, Gopal Agrawal, CEO of Anupam Rasayan India Ltd based in Surat, Gujarat, said the industry is witnessing increased logistics costs, longer transit timelines and continued volatility in crude-linked raw materials, all of which are impacting manufacturing economics and supply continuity.
Anupam Rasayan is a chemicals manufacturer that produces key intermediates and active ingredients for the pharmaceutical, agrochemical, and specialty chemical sectors.
“In this context, the proposal to evaluate temporary price support measures appears to be a balanced and pragmatic approach to ensure uninterrupted availability of essential medicines while supporting industry sustainability,” Agrawal said.
To be sure, a move by the government to divert petrochemical feedstocks for domestic LPG (liquified petroleum gas) supply—in the wake of a cooking gas supply squeeze from the West Asia war—triggered a near-crisis in India’s pharmaceutical sector in March, as reported by Mint earlier.
The diversion disrupted supplies of isopropyl alcohol (IPA)—a key solvent used in essential medicines and life-saving drugs—and prompted top drugmakers to warn of supply disruptions.
The crisis was managed after the Centre stepped in on 1 April with emergency measures, allowing the reallocation of a ‘certain minimum’ quantum of critical refinery inputs such as propylene and propane to suppliers for priority sectors.
What are essential medicines?
The National List of Essential Medicines (NLEM) groups 384 drugs into 27 therapeutic categories to regulate prices and availability. Infectious diseases and chronic conditions dominate the list. The Anti-infective category is the largest, including antibiotics like amoxicillin and azithromycin, alongside critical anti-TB and antiviral regimens. For chronic care, Cardiovascular Medicines cover major formulations like amlodipine and atorvastatin, while Hormones and Endocrine Medicines ensure access to insulin and metformin.
Emergency and acute care are covered under Analgesics and NSAIDs (paracetamol, ibuprofen) and Anaesthetics (propofol, ketamine). Mental health and cancer treatments are protected through categories for psychotherapeutic drugs like fluoxetine and risperidone, and anti-cancer agents like methotrexate. The Gastrointestinal Medicines include (ORS, omeprazole), Respiratory Tract Medicines include (salbutamol), and essential Vaccines, ensuring a comprehensive safety net for public healthcare.