Union Budget 2026-27 And Access To Medicines

The Union Budget 2026-27 made two major announcements regarding medicines. First, it removed basic customs duty (BCD) on 17 cancer medicines. Second, it extended import duty exemptions to seven additional rare diseases for personal imports of drugs, medicines, and Food for Special Medical Purposes (FSMP). This is the third consecutive budget announcing BCD exemptions. In 2024, the BCD exemption covered three cancer medicines of the British- Swedish pharmaceutical company AstraZeneca. In 2025, the budget expanded this to 36 medicines for cancer and rare diseases. While these announcements may seem to be a great effort towards the affordability of patented medicines, the broader picture suggests that structural barriers to healthcare, particularly access to medicines, remain unresolved. These measures appear impressive in the budget announcement, but the actual impact on access to medicines remains bleak and uncertain.Limited Benefit to Patients Despite Tax ExemptionsThe announcement of customs duty exemptions on several life-saving drugs and therapies, including CAR-T treatments, has been welcomed as an effort of the central government to reduce the prices of high-cost patented life-saving medicines to make them accessible in India. However, the real-world impact of such measures must be evaluated in the context of the prevailing retail prices of those drugs before and after the Budget announcement.Even though the Budget proposes an exemption, the customs duty constitutes only part of the overall pricing structure, and even if there is a complete elimination of the tariff levied, the proportionate reduction in patient expenditure may remain very low as compared to the total cost of medicine.Available market data shows that many targeted cancer therapies continue to cost lakhs of rupees annually. For example, the cost of Ribociclib, a drug used for the treatment of breast cancer, was approximately ₹24,355 per strip of 21 tablets in 2023 and continues to remain in a similar range in 2025–2026. Based on standard Clinical Dosing, the annual treatment cost can approach ₹9-10 lakh per patient. Similarly, Ipilimumab, used for immunotherapy treatment of various types of cancers, has been consistently sold at roughly ₹2.28 lakh per vial and costs approximately ₹36 lakh for a complete course, depending on the requirement of the patient. Trastuzumab Deruxtecan, which was listed in the 2024 BCD exemption, continues to cost more than ₹1 crore annually for many patients. The more concerning fact is that the pharmaceutical companies have not reduced the prices of drugs inclusive of taxes even after the customs duty exemption. Consequently, it undermines the customs duty exemption exercise and the intended purpose of the central government to reduce the prices of life-saving patented drugs to make them affordable.Patent Monopolies: The Real Reason Behind Exorbitant PricingIn recent years, the government has heavily relied on indirect measures such as customs duty exemptions on certain medicines to reduce the price of drugs. However, as discussed, this makes little to no difference to the exorbitant prices of the drugs in question. Even after customs duties are removed, patent-protected medicines remain far beyond the reach of common people.The main determinants of exorbitant prices of life-saving medicines are not customs duties but the existence of patent monopolies. Patent exclusivity restricts competition, allowing manufacturers to maintain high prices even in low and middle-income countries. Moreover, the Patents Act, 1970, provides various measures that can potentially help patients to access life-saving drugs at affordable prices. Legal tools such as stricter scrutiny of secondary patents, mandatory local-working requirements, government use, compulsory licensing, and improving the regulatory framework, including streamlining the approval process for generics, can be effectively used by the government to ensure access to affordable medicines.Access to Medicines and Constitutional ObligationsQuestions surrounding the affordability of high-cost medicines have also reached constitutional courts, and on several occasions, courts have declared access to medicine as a cornerstone of the right to health under Article 21 of the Constitution.The Supreme Court in the case of Paschim Banga Khet Mazdoor Samity v. State of West Bengal (1996) held that the State has a constitutional obligation to provide adequate medical facilities to the needy, and financial constraints cannot justify the denial of proper medical facilities and affordable medicine. This case laid down the foundation for treating the right to health care as an integral part of Article 21of the Constitution.In the Association of Medical Super Speciality Aspirants and Residents v. Union of India (2019), the Supreme Court reiterated that it is the primary duty of the state to secure health for its citizens. The court noted that the “Right to health is integral to the...

Union Budget 2026-27 And Access To Medicines

Prabhat Kumar Saha & Deepti Yadav

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Union Budget 2026-27 And Access To Medicines

Prabhat Kumar Saha & Deepti Yadav

This is a premium content Available exclusively to Our subscribers

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