GST reduced on three cancer drugs: How will this benefit patients?
The central government has reduced the GST on three cancer drugs from 12% to 5%, which were earlier exempted from basic customs duty.
The GST Council, headed by Finance Minister Nirmala Sitharaman, reduced the Goods and Services Tax on three cancer drugs from 12% to 5%.
These anti-cancer drugs are immune and targeted therapies, such as trastuzumab deruxtecan, osimertinib and durvalumab, sold by British-Swedish pharmaceutical and biotechnology company AstraZeneca.
Trastuzumab deruxtecan: It is an antibody-drug conjugate used primarily to treat HER2-positive breast cancer that has spread to other parts of the body (metastatic). It is also being studied for use in other types of cancer, such as gastric cancer.
Osimertinib: It is a targeted therapy used to treat non-small cell lung cancer (NSCLC) with specific mutations in the EGFR gene. It is particularly effective against cancers that have developed resistance to previous generations of EGFR inhibitors.
Durvalumab: It is an immunotherapy drug that works by blocking the PD-L1 protein, thereby helping the immune system attack cancer cells. It is used to treat non-small cell lung cancer (NSCLC) and urothelial carcinoma (bladder cancer).
| Name of the drug | old price | new price |
|---|---|---|
| trastuzumab deruxtecan | Rs 3,49,800 per vial | Approx Rs 3,29,800 – 3,34,500* |
| Osimertinib | Rs 1,17,500 for 3 strips | Approx Rs 97,500 to Rs 1,02,500* |
| durvalumab | Rs 1,57,000 per packet | Approx Rs 1,37,000 to Rs 1,42,000* |
*These are estimated prices. However, the actual reduction in retail price depends on how manufacturers and distributors pass on the tax savings to patients.
If the entire GST reduction is passed on, patients may see a reduction in medicine prices by around 7% (due to 7% reduction in GST rate).
The total reduction may be slightly lower due to complex pricing and distribution chain.
How will patients benefit from this step?
While the basic customs duty will reduce the import cost of medicines, the GST Council’s decision will provide some financial relief to patients.
“The GST decision will reduce the cost of medical treatment by Rs 15,000 to Rs 20,000 per month. Since many medicines are very expensive, the government should consider including more cancer drugs under this change,” said Dr Amit Upadhyay, senior consultant, haematology oncology, PSRI Hospital, New Delhi.
Dr Upadhyay suggested that the cancer immunotherapy drug pembrolizumab, which treats several types of cancer including breast cancer and lung cancer, should also be considered by the GST Council to provide some relief.
The expert also suggested reducing the cost of nivolumab, another type of targeted therapy drug for urinary tract cancer.
“Reducing drug prices will reduce the out-of-pocket cost of these essential medicines for patients. This can make cancer treatment more affordable, especially for those who do not have insurance or have high out-of-pocket expenses,” said Dr Aditya Sarin, Senior Consultant, Medical Oncology, Sir Ganga Ram Hospital, New Delhi.
Anti-cancer drugs pose a huge financial burden on Indian patients.
In July 2023, the GST Council provided a concession on the drug Dinutuximab, which is used to treat neuroblastoma, a rare cancer that affects nerve cells.
Dinutuximab, which costs around Rs 36 lakh, was imported, becoming less of a financial burden for cancer patients.
The reduction in GST on cancer drugs is in line with the recommendations made by a parliamentary panel in 2022.
The panel had sought complete removal of GST on cancer drugs, highlighting the high cost of cancer treatment in India.
It also proposes to designate cancer as a notifiable disease, making it mandatory to report cases to the government, and highlight the severity and widespread impact of cancer-related health problems.
A 2022 global study found that even though many high-priority cancer drugs identified by Indian oncologists, mainly generic chemotherapy agents, are comparatively affordable, they remain out of reach of patients due to financial constraints.
Dr Sarin emphasised that lower cost of medicines can improve access to medicines for a large section of the population. “This can make these medicines more affordable for low-income families and people living in economically deprived areas,” the expert said.
Another important study published by the Tata Memorial Centre showed that less than 3% of cancer patients in India have access to promising new treatments. In some cases, immunotherapy costs up to Rs 50 lakh annually.
As per statistics, the major factors of financial toxicity in cancer patients are anti-cancer drugs and diagnostics.
Though making accessible and affordable cancer treatment available is still a long way away, experts say removing customs duties and reducing GST can help reduce the cost and stress faced by patients in India.
