NPPA Guidelines : Mandatory Actions for Pharma Companies on GST Rate Reduction from 22nd September 2025
In the context of the GST rate reduction on drugs, formulations, and certain medical devices, which comes into effect from 22nd September 2025, manufacturers and marketers are required to undertake several mandatory actions to ensure that the benefit of this reduction is passed on to consumers and patients.
Mandatory Actions for Manufacturers and Marketers:
- Reduce Maximum Retail Price (MRP): All manufacturers and marketing companies selling drugs/formulations, including medical devices, must adjust and reduce their MRPs accordingly, effective from 22nd September 2025.
- Issue Revised Price Lists: These companies are mandated to issue revised price lists or supplementary price lists. These lists, to be provided in Form V/VI, must be distributed to dealers, retailers, State Drug Controllers, and the Government. The purpose of these revised lists is to reflect the newly adjusted GST rates and the revised MRPs.
- Public Communication and Sensitisation: Manufacturers and marketing companies must take immediate steps to sensitise dealers, retailers, and consumers about the GST rate reduction and the consequent MRP changes. This communication should utilise all available channels, including electronic, print, and social media. Furthermore, industry associations are encouraged to publish advertisements in leading national newspapers, including vernacular newspapers, to ensure that dealers and retailers comply with the revised GST rates from 22nd September 2025.
- Ensure Price Compliance for Existing Stock: For existing stock released in the market before 22nd September 2025, recalling, re-labelling, or re-stickering is not mandatory if the manufacturer or marketing company can ensure price compliance at the retailer level through the aforementioned measures
(e.g., communication and revised price lists). This implies that even without physical re-labelling, the lower price must be charged.
Permitted Actions (Relating to Labelling/Sticker Changes):
- Optional Re-labelling/Re-stickering: Manufacturers and marketing companies that wish to re-label or re-sticker the stock available in the market are permitted to do so. However, this must be carried out in a phased manner to avoid causing a shortage of drugs or medical devices in the market. Necessary directions for this were issued by CDSCO on 11th September 2025, under Rule 104A of the Drugs and Cosmetics Rules, 1945.
- Specific for Class C and D Medical Devices: Importers and manufacturers of Class C and D medical devices have been given specific permission. There is no objection to them affixing stickers of the revised MRP for GST implementation, provided this is done within three months from the date of the order (11th September 2025). This permission effectively means they do not need to seek additional approval for this specific labelling change.
https://nppa.gov.in/uploads/tender/01da3cf0cd3d17c68c9a63fe23878260.pdf
