Its response to a DoH consultation on drug pricing said the current arrangements 'look increasingly inappropriate' as NHS resources are squeezed.
Leaving commissioners to make decisions on specialist drugs could widen 'postcode rationing and the pillorying of commissioning groups', it said.
Dr Brian Karet, RCGP clinical lead for diabetes, said GP commissioners would soon have to make decisions about expensive drugs that PCTs had been reluctant to fund.
'These things should be done through the design of care pathways,' he said.
'They should be part of an agreed care package involving patients and clinicians. It is not just about arbitrary decisions.'
The BMA said the plans on drug pricing were too lacking in detail to assess properly.
The 'generic nature of the proposals makes it difficult to draw a firm conclusion' as to their overall merits, it said.
The BMA also stressed there was no reason the move would cut NHS prescribing costs. It raised doubts about the practicality and legality of assigning different prices for the same drug depending on the condition it was being used to treat.
The BMA also warned the proposals did not take into account international trade in medicines. 'It is uncertain how much impact the profits that a company will make from sales in the NHS will influence the development priorities of companies that are multinational and will get a larger return from overseas sales,' the BMA response said.