The Price of a Prescription

In January 2011, The Lancet published a statistic that should have made every policymaker in Delhi lose sleep: healthcare costs push 39 million Indians into poverty every year. In a country where insurance coverage is thin and government spending on health remains modest, out-of-pocket expenditure accounts for nearly four-fifths of total health spending. And the biggest culprit is not surgery, not intensive care, not hospital beds.

It is medicines.

Surveys showed that in rural India, nearly three-quarters of healthcare spending goes toward buying drugs. I did not need a journal to believe that number. I saw it unfold every day in Sevagram—quietly, repeatedly, without drama, like a slow leak that empties a household.

A daily-wage labourer would arrive breathless after a heart attack. A farmer would be carried in after a snakebite. A young mother would come in with pneumonia, shivering, lips tinged blue. We would treat them. We would stabilise them. We would sometimes save them.

And then, at the end of the encounter, we would hand them a prescription.

That piece of paper, so light in the doctor’s hand, could become unbearably heavy in the patient’s life. The man would sell his wife’s jewellery. He would mortgage his small plot of land. He would borrow from a moneylender at an interest rate that no sane person would accept—except desperation makes sane people sign anything.

Healthcare had become one of the leading causes of rural debt, second only to dowry. I began to realise something uncomfortable: we couldn’t just treat the disease; we had to treat the bill.

The Anatomy of a Price Tag

The more I watched families struggle, the more I asked a simple question: why are medicines so expensive?

When I started looking closely, the market seemed like a theatre of contradictions. The same molecule—say, atorvastatin, prescribed for cholesterol—was sold by one company at ₹0.80 per tablet and by another at ₹8.00. A ten-fold difference for the same drug. The difference was not quality. It was not science.

It was perception.

Market leaders charged a premium because they spent crores convincing doctors that their brand was “superior.” They created a monopoly not of molecules, but of minds. Then came the long supply chain—carrying and forwarding agents, stockists, wholesalers, retailers—each adding a margin as the drug travelled from the factory gate to the patient’s palm. The final markup often reached absurd levels: 1000% to 4000%.

We could not fix the national market. We were not the Government of India, nor the Drug Controller. But we could fix the market within our walls.

And so we decided to intervene.

The Drug and Therapeutics Committee

We formed a Drug and Therapeutics Committee (DTC)—not as a formality, but as a tool. The committee included senior faculty and the chief pharmacist. The goal was clear: bypass the inflated marketplace and build a direct pipeline from the manufacturer to the patient.

We began with rational selection. The first discipline was learning to say no.

Instead of buying every brand that a medical representative promoted, we created a list of essential medicines—guided by WHO principles and our own local needs. We limited ourselves to two brands per drug, because endless choice does not empower patients; it confuses doctors and inflates cost.

Then came quality control. We did not want “cheap” medicines that failed. We wanted affordable medicines that worked. We invited tenders only from manufacturers with good credibility and GMP compliance—companies such as Cipla, Ranbaxy, Piramal, Dr. Reddy’s, Alembic. We shortlisted around sixty-plus companies we trusted.

Finally, we negotiated—hard.

We called for bulk quotations for hundreds of generic medicines and a hundred surgical items—gloves, syringes, IV fluids, sutures. We invited suppliers for face-to-face discussions.

Our pitch was blunt, almost rude by corporate standards.

“We will buy directly. No middlemen. No marketing costs. Give us your factory price.”

It was not charity. It was bargaining for fairness.

When Prices Fell Like a Wall

The moment we stripped away marketing and margins, prices collapsed.

Not by a few rupees, but by a scale that made even our own pharmacists stare twice at the printouts.

A few examples stayed with me because they carried lives inside them.

Pralidoxime, the antidote for pesticide poisoning—so common in rural India—had a market MRP of ₹155. In our store, it came down to ₹44.

Anti-snake venom, the difference between life and death for a farm worker bitten in the field, was priced at ₹450 outside. We brought it down to ₹240.

Piperacillin–tazobactam, a high-end antibiotic used for severe sepsis in the ICU, cost around ₹1650 per vial in the market. In Sevagram, we could supply it at ₹465.

Numbers like these do not merely reduce expenditure. They change behaviour. They keep families from abandoning treatment halfway. They keep doctors from hesitating before prescribing what is clinically necessary.

We opened dedicated medical stores—one catering to OPD patients and one for inpatients. We capped our own margin at 20%, not to make profit, but to cover electricity, salaries, and the basic costs of running a store.

We educated our doctors: “Prescribe from this list.”
We educated our patients: “Buy from this store.”

And to keep the system honest, we published a monthly Drug Bulletin by email, listing stock and prices. Transparency became our insurance against corruption.

Three Drugs, Three Days, Five Rupees

In October 2010, we went a step further—because not every patient needs ICU antibiotics. Many come with minor ailments: fever, acidity, body ache, cough, diarrhoea. For the poorest outpatients, even small purchases add up.

So we introduced what we called the “Pink Slip” initiative.”

We identified 25 common medicines—painkillers, antacids, antipyretics—and pre-packed them. If a doctor prescribed up to three of these drugs for three days, the patient paid a flat charge of ₹5.

Five rupees.

For the cost of a cup of tea, a labourer could walk away with a short course of treatment and the dignity of not borrowing money for paracetamol.

It was a small scheme, but it carried a big idea: equity must be designed, not wished for.

The ICU Lesson: Price Saves Lives

The real impact, however, showed itself in the wards and ICUs.

A year earlier, treating severe sepsis in the ICU was often a financial catastrophe. A ten-day course of high-end antibiotics could cost ₹30,000. Families would sit by the bedside, counting not just breaths, but notes in their wallet. Many would ask, with shame and exhaustion, whether we could stop treatment—because they had run out of money.

After the low-cost initiative, that same antibiotic course could come down to around ₹9,000. It was still expensive for a poor family, but it was no longer impossible. The difference between ₹30,000 and ₹9,000 is not arithmetic. It is survival.

The same pattern appeared elsewhere. A breast cancer patient who once paid ₹10,000 for a monthly chemotherapy cycle could now pay ₹3,700. Thrombolysis for heart attacks became less terrifying—not because the drug changed, but because the price did.

That was the lesson Sevagram taught me: high-quality care is not always inherently expensive. Often, “high cost” is an artificial construct of a greedy market.

If we could push prices down without compromising quality, then economics could become a tool for compassion.

And that, to me, was public health in its most practical form.

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