Stakeholders welcome govt’s decision to slash GST rate on cancer drugs from 12% to 5%

New Delhi: The GST council has decided to reduce Goods and Service Tax (GST) on cancer drugs namely, Trastuzumab Deruxtecan, Osimertinib and Durvalumab from 12% to 5%.

The decision was taken in the 54th GST Council meeting chaired by the Union Finance Minister Nirmala Sitharaman held in New Delhi on September 09, 2024.

Welcoming the move, Anil Matai, Director General, OPPI said: “We commend the Government’s decision to reduce the GST rate on certain cancer drugs from 12% to 5%. This reduction marks a pivotal step in making life-saving treatments more affordable and accessible. We at the Organisation of Pharmaceutical Producers of India (OPPI) applaud this decision by the GST Council. To further improve patient outcomes and ensure comprehensive access, we recommend extending such exemptions not only to all cancer medications but also to all rare diseases medications. Such initiatives will make a significant difference in the lives of patients across India, enabling better treatment and improving overall healthcare outcomes.”

Calling it a commendable step in the right direction, Sushant Roy, Co-Founder, COO & CBO at Alyve Health said, “Today, nearly two million cancer cases are reported annually in India, with many patients requiring ongoing medication and treatment. The initiative to reduce GST on cancer drugs from 12% to 5% will further ease the financial burden on patients and their families, making life-saving treatments more accessible to those who need them most. This relief not only helps patients but also supports their families, who are equally affected by the emotional and mental toll of cancer care.

“Reducing the cost of cancer treatment is not just a financial necessity; it’s a step towards improving the overall mental health and well-being of millions of Indians. Every bit of financial relief can make a world of difference, offering hope and stability in the face of one of life’s toughest battles. Such measures are crucial in our collective fight against cancer, ensuring that no one is left behind due to financial constraints,” added Roy.

D. S. Negi, CEO, Rajiv Gandhi Cancer Institute & Research Centre (RGCIRC) said, “It is a significant step towards making cancer treatment more affordable and accessible for patients. This follows the recent budget announcement that exempted these drugs from customs duty, marking a positive step forward. The high cost of cancer medications has been a major hurdle for many patients.”

“The move is aligned with our mission to ensure that every patient has access to world-class cancer care without the burden of high costs. It will help reduce the financial burden on cancer patients and their families, especially those undergoing treatment with expensive treatments,” added Negi.

As per Devashish Singh, Co-founder, MrMed said, ““We hope that the roll-out of the GST cut will have an almost immediate impact, although the accounting of medicines already in the supply chain with MRP’s determined based on the old GST rate will need to be understood. We are assuming that the MRP will change and for this to take effect, the drug department needs to be informed as well.

Singh added further: “Patients that are undergoing treatment using these drugs are already benefiting from various Patient Assistance Programs (PAPs) run by the manufacturer; in this case Astrazeneca. These PAPs reduce the financial burden by providing free medication to genuine patients based on certain eligibility criteria. Further, online speciality pharmacies like MrMed have also reduced prices for these medicines by 30-42k per cycle, resulting in an overall saving of approximately 4 lakhs per year. We expect this GST cut to save an additional 1 lakh per year.”

Shring his expectations from the policy makers, Singh said, “We hope that these GST rate cuts will be extended to other patented therapies including Alectinib, Lorlatinib, Pertuzumab and other high-cost cancer therapies. These are extremely important moves in a strategic sense too and could convince other multi national pharmaceutical companies to bring in new and customized targeted therapies to India.”