Kerala govt plans major price cuts for insulin, SMA drugs; move comes amid medicine shortage row

The Kerala government plans to reduce medicine prices in public hospitals by eliminating intermediaries and purchasing drugs directly from pharmaceutical manufacturers. The move follows criticism over medicine shortages reported across the state.

The Kerala Medical Services Corporation Ltd (KMSCL) has reportedly negotiated substantial price reductions with manufacturers, offering to clear payments within two months. The proposed changes are also aimed at overhauling the corporation’s procurement system and improving the availability of essential medicines in government hospitals.

Insulin, erythropoietin prices to fall

Under the revised procurement arrangements, the price of a 10ml vial of insulin is set to fall from ₹99.60 to ₹73. The reduction is expected to save ₹18.50 crore on supplies required over four months, according to reports.

The price of erythropoietin injections, used in the treatment of patients with kidney disease and certain other conditions, including those undergoing chemotherapy or living with HIV, may fall from ₹110 to ₹80 per dose.

A significant reduction has also been reported in the price of Risdiplam, a drug used to treat spinal muscular atrophy (SMA), a rare genetic disorder.

The medicine was previously procured from Roche at ₹5.52 lakh per bottle. Following approval for a generic version from Natco Pharma after a Supreme Court ruling, the price has reportedly been negotiated down to ₹8,000 per bottle.

KMSCL to overhaul procurement system

The government’s decision to revise medicine procurement procedures follows criticism over shortages in public hospitals. Health Minister K. Muraleedharan has ordered a comprehensive overhaul of KMSCL’s operations.

Under the proposed system, annual tenders will be restricted to pharmaceutical manufacturers and direct import agencies. Intermediaries will be excluded from the procurement process.

The tenders are expected to be completed by December, with fresh supplies scheduled to reach hospitals by February.

The changes are intended to make procurement more direct while securing lower prices for medicines supplied to government hospitals.

The revised procurement policy will also introduce stricter conditions for suppliers.

KMSCL will be required to purchase medicines that are already being supplied to public healthcare systems in at least two other states. The medicines must also be available at prices lower than those offered by the Thiruvananthapuram Medical College In-House Drug Bank, according to reports.

The corporation will publish annual medicine procurement prices online to improve transparency. Suppliers and their representatives will also be prohibited from offering gratuities to officials or others involved in the procurement process.

Companies supplying substandard medicines could face permanent blacklisting, preventing them from participating in future procurement, the reports said.

Existing one-year contracts finalised in March will be phased out as part of the transition to the revised system.

Satheesan blames previous LDF government for shortages

Chief Minister V.D. Satheesan has rejected criticism that the current administration is responsible for the medicine shortages, attributing the problem to shortcomings in the previous Left Democratic Front (LDF) government's procurement process.

Speaking at a press conference on Friday, Satheesan said the medicines required by hospitals for a particular year were determined through an advance requisition process, known as an indent.

Under this system, district-level medical officers submit their requirements in the preceding year. KMSCL then floats tenders, selects suppliers and places orders based on the quantities requested.

Satheesan said the requisition process had not been completed properly during the previous government's tenure, affecting medicine supplies in the current year.

“If there was a shortage of medicines this year, it was because last year's indent process was not done properly. It was not a creation of the current government,” he said.

Satheesan said the supply problem affected 28 medicines and that the government had introduced an alternative mechanism to address the shortages.

Under the arrangement, medicines would be transferred from locations where stocks were available in sufficient quantities to hospitals and other facilities facing shortages.

He maintained that the problem did not mean medicines were unavailable throughout Kerala, claiming that only four or five medicines were actually unavailable.

The chief minister also said the government had directed hospitals to procure medicines locally wherever necessary to ensure their availability in emergencies.

The revised procurement policy and the alternative supply arrangements come amid scrutiny of medicine availability in the state's public healthcare system. While the government has attributed the shortages to earlier procurement lapses, the proposed changes are expected to alter how medicines are purchased and supplied to public hospitals.