The government has announced a major relief for pharmaceutical companies.
Now, companies will not have to re-label or recall medicines that were released in the market before September 22, 2025.
The National Pharmaceuticals Pricing Authority (NPPA), which works under the Department of Pharmaceuticals, clarified that instead of recalling stocks, pharma companies can update the prices of medicines at the retailer level.
This change comes as new GST rates on medicines will be implemented from September 22, 2025.
NPPA Clarifies Price Revision Process
The NPPA has asked all manufacturers and marketing companies to revise the maximum retail price (MRP) of medicines.
Companies should issue updated price lists or supplementary price lists to dealers, retailers, state drug controllers, and the government.
These lists will show the revised GST and new MRP, ensuring that customers get the full benefit of the GST reduction.
The Finance Ministry also confirmed that if price changes are applied at the retailer level, there is no need to recall, relabel, or re-sticker medicines that were already in the market. T
his has brought significant relief to the pharma industry, which was previously worried about the cost and logistics of recalling medicines.
Responsibility of Retailers and Benefits to Customers
Now, it will be the retailers’ responsibility to sell medicines at the new GST rates.
Pharma companies will provide revised price lists, but retailers must display the updated prices.
This ensures that customers benefit from the GST reduction without causing supply chain issues or shortages of essential medicines.
The government’s clarification also aims to reduce problems for pharma companies while making sure that essential medicines remain available to the public.
New GST Rates Effective from September 22
The GST Council approved major changes to the GST framework on September 3, 2025. Key changes include:
Reducing the number of GST slabs from four to two.
Adjusting GST rates on various items, including medicines, which has led to a drop in medicine prices.
These new tax rates will be effective from September 22, 2025.
