Drug Price Control Order (DPCO) and NPPA overview MCQs With Answer

Introduction: This quiz set on the Drug Price Control Order (DPCO) and the National Pharmaceutical Pricing Authority (NPPA) is designed for M.Pharm students preparing for regulatory and legislation exams. The questions focus on the legal basis of price control, the role and powers of NPPA, the National List of Essential Medicines (NLEM), principles introduced by DPCO 2013, ceiling price determination, monitoring and enforcement actions, and practical aspects such as price lists and recovery of overcharges. The aim is to deepen understanding of how India regulates essential medicine prices, how scheduled formulations are identified and priced, and how NPPA executes its mandate to ensure affordability and availability of medicines.

Q1. When was the National Pharmaceutical Pricing Authority (NPPA) constituted?

• 1986
• 1994
• 1997
• 2003

Correct Answer: 1997

Q2. Under which central legislation is the Drug Price Control Order (DPCO) issued?

• Drugs and Cosmetics Act, 1940
• Essential Commodities Act, 1955
• Food Safety and Standards Act, 2006
• Consumer Protection Act, 1986

Correct Answer: Essential Commodities Act, 1955

Q3. What is the primary objective of the Drug Price Control Order (DPCO)?

• To regulate quality control testing protocols for drugs
• To control prices of specified medicines to ensure their affordability and availability
• To license manufacturing facilities for pharmaceutical companies
• To regulate clinical trials in India

Correct Answer: To control prices of specified medicines to ensure their affordability and availability

Q4. What are “scheduled formulations” under DPCO?

• Formulations exempted from any pricing regulations
• Formulations listed under DPCO (based on NLEM) whose prices are regulated by NPPA
• Only veterinary formulations covered by state authorities
• Homeopathic and Ayurvedic formulations under schedule

Correct Answer: Formulations listed under DPCO (based on NLEM) whose prices are regulated by NPPA

Q5. Which ministry is NPPA administratively attached to?

• Ministry of Health and Family Welfare
• Ministry of Chemicals and Fertilizers
• Ministry of Commerce and Industry
• Ministry of Consumer Affairs

Correct Answer: Ministry of Chemicals and Fertilizers

Q6. Which of the following is a primary statutory function of NPPA?

• Granting manufacturing licenses to drug factories
• Fixing ceiling prices of scheduled formulations
• Approving new drug clinical trial protocols
• Issuing GMP certificates to manufacturers

Correct Answer: Fixing ceiling prices of scheduled formulations

Q7. Which major pricing approach did DPCO 2013 introduce compared with earlier orders?

• It introduced cost-plus pricing as the only method for all drugs
• It introduced market-based pricing (using market data) for scheduled formulations
• It abolished price control completely for essential medicines
• It required international reference pricing as the sole basis

Correct Answer: It introduced market-based pricing (using market data) for scheduled formulations

Q8. How does NPPA normally determine the ceiling price for an existing scheduled formulation under DPCO 2013?

• By taking the simple average of prices of all brands having market share of 1% or more
• By using only the lowest priced brand in the market
• By adopting the manufacturer’s declared maximum retail price (MRP)
• By using international median reference prices only

Correct Answer: By taking the simple average of prices of all brands having market share of 1% or more

Q9. Which government body prepares and notifies the National List of Essential Medicines (NLEM)?

• Ministry of Chemicals and Fertilizers
• Ministry of Health and Family Welfare (through its expert committee)
• National Pharmaceutical Pricing Authority (NPPA)
• Central Drugs Standard Control Organization (CDSCO)

Correct Answer: Ministry of Health and Family Welfare (through its expert committee)

Q10. Which enforcement action can NPPA take when it finds a manufacturer has sold a scheduled formulation above the ceiling price?

• Issue a manufacturing license cancellation without process
• Order recovery of the overcharged amount, with interest, from the manufacturer
• Direct hospital procurement stops nationwide
• Place the manufacturer under criminal detention

Correct Answer: Order recovery of the overcharged amount, with interest, from the manufacturer

Q11. For how many past years can NPPA normally order recovery of overcharged amounts for scheduled formulations?

• 6 months
• 1 year
• 3 years
• 10 years

Correct Answer: 3 years

Q12. What is the abbreviation “RPL” commonly used on the NPPA website?

• Regulatory Price List
• Retail Price List
• Regional Procurement Ledger
• Registered Product Log

Correct Answer: Retail Price List

Q13. What is the legal status of NPPA?

• A private corporation under Companies Act
• An advisory non-statutory committee
• A statutory body constituted by the Government of India
• An NGO working under international funding

Correct Answer: A statutory body constituted by the Government of India

Q14. In which year was the Drug Price Control Order referred to as “DPCO 2013” notified?

• 1995
• 2005
• 2010
• 2013

Correct Answer: 2013

Q15. When NPPA computes market shares for ceiling price determination, it typically uses sales data from which period?

• Last 3 months
• Preceding 12 months
• Last 5 years
• Projected next 12 months

Correct Answer: Preceding 12 months

Q16. Who appoints the Chairperson and members of NPPA?

• State governments in rotation
• Central Government of India
• World Health Organization
• Indian Medical Association

Correct Answer: Central Government of India

Q17. Which of the following is generally NOT within the NPPA’s regulatory scope?

• Fixing ceiling prices for scheduled drug formulations
• Monitoring and reporting retail prices of medicines
• Setting safety and efficacy standards for medical devices
• Ordering recovery of overcharged amounts for medicines

Correct Answer: Setting safety and efficacy standards for medical devices

Q18. Which of the following statements about NPPA’s powers is correct?

• NPPA can directly change a drug’s therapeutic indication
• NPPA can unilaterally delist a drug from NLEM
• NPPA can issue price notifications and direct recovery of overcharges from manufacturers
• NPPA can grant patent protection to a new molecule

Correct Answer: NPPA can issue price notifications and direct recovery of overcharges from manufacturers

Q19. Who typically recommends inclusion or revision of medicines in the NLEM?

• National Pharmaceutical Pricing Authority (NPPA) only
• An expert committee constituted by the Ministry of Health and Family Welfare
• State Drug Controllers without central input
• Pharmaceutical trade associations alone

Correct Answer: An expert committee constituted by the Ministry of Health and Family Welfare

Q20. Where is the headquarters of the National Pharmaceutical Pricing Authority (NPPA) located?

• Mumbai
• Kolkata
• New Delhi
• Chennai

Correct Answer: New Delhi

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