High out-of-pocket expenditure remains the main barrier to Universal Health Coverage for diseases like cancer. Evaluate recent regulatory and fiscal measures to address it.

Cancer treatment pushes many Indian households into catastrophic out-of-pocket expenditure (OOPE). A key driver is the supply-chain mark-up on drugs, which NPPA found averaged ~170% and reached 700%+ in some cases [1]. Recent measures have made real gains, but these remain incomplete.

Regulatory measures: gains

• Trade Margin Rationalisation (TMR): In 2019, NPPA used Para 19, DPCO 2013 to cap margins at 30% on 42 non-scheduled cancer drugs. MRPs of 526 brands fell ~50% on average, saving patients ~₹984 crore a year [2].
• 2026 extension: The 30% cap now covers all non-scheduled anti-cancer drugs: branded or generic, patented or imported. Prices are expected to fall up to 70%, saving ₹2,500 crore a year. Manufacturers must keep production at current levels [1].
• Cooperative federalism: Maharashtra, Rajasthan and Karnataka pressed for the cap [1].

Fiscal measures: gains

• Budget 2025-26: 36 life-saving drugs are fully exempt from Basic Customs Duty and 6 attract a concessional 5%. Drugs supplied under Patient Assistance Programmes are also exempt [3].
• Day Care Cancer Centres will be set up in all district hospitals within three years (200 in 2025-26), cutting travel and indirect costs [4].

Limitations

• Weak legal footing: DPCO allows margin capping only temporarily. The Standing Committee on Chemicals and Fertilisers urged amending DPCO [5]. In 2026 it again flagged the absence of a permanent TMR framework [6].
• Enforcement gaps: Price-to-stockist data is not public, so patients cannot check margins [5]. Large overcharged amounts are stuck in litigation, and NPPA lacks hospital and rural sales data [6].
• Design flaw: A flat 30% margin is largest in rupee terms on the costliest drugs. WHO advises regressive mark-ups instead (lower rates for higher-priced drugs) [7]. The manufacturer's price, the main cost of patented imports, remains free [1].
• Availability risk: The supply condition binds only manufacturers. Chemists in small towns may stop stocking low-margin specialty drugs.

Overall, margin caps and duty relief have substantially reduced the price of cancer drugs. The way forward is to:

• put TMR into DPCO through a statutory amendment;
• disclose PTS data;
• adopt a WHO-style regressive mark-up;
• track drug availability in district markets.

Combined with decentralised care, these steps can turn lower prices into lower OOPE. That would bring India closer to SDG 3.8: universal health coverage with financial protection.