Supreme Court Questions Government on Medicine Pricing: Is This Justified?
Supreme Court Critiques Centre Over Medicine Pricing
New Delhi: The Supreme Court has raised serious concerns regarding the stark contrast between the maximum retail price (MRP) of medications and their prices to retailers, questioning the government's justification for what it termed as 'loot'.
Justices Vikram Nath and Sandeep Mehta expressed their discontent with the National Pharmaceutical Pricing Authority (NPPA), labeling it ineffective and inquiring why the system appears to favor pharmaceutical manufacturers.
The court has reserved its judgment on two petitions addressing drug pricing issues, particularly the need for stringent price controls on medicines.
In response to the Centre's announcement to limit the trade margin on anti-cancer drugs to 30% of the MRP, the bench queried why a uniform margin of 16% couldn't be applied across all medications.
The Additional Solicitor General, Aishwarya Bhati, representing the government, stated that the entire pharmaceutical ecosystem should not be subjected to control.
The justices highlighted a troubling example where a medicine priced at Rs 15 for retailers had an MRP of Rs 250, questioning the rationale behind such disparities.
The bench demanded clarity on why the government permits these practices, emphasizing that the situation unfolds under its supervision.
When Bhati mentioned the need for control, the bench countered, asking if such pricing should be allowed to continue unchecked.
The law officer claimed that India boasts some of the lowest medicine prices globally.
However, the bench pointed out the significant gap between MRP and PTR, questioning why the system seems to benefit manufacturers disproportionately.
The court referenced a recent incident involving a medical distributor whose wife was charged Rs 1.30 lakh for an injection that cost him only Rs 11,000.
The justices remarked that the public seems to be under the illusion that the NPPA will eventually benefit them.
The NPPA was established as an independent body to regulate drug pricing and ensure that medicines are accessible and affordable.
When Bhati discussed control measures, the bench reiterated that the issue is not merely about control, but about the staggering 300% to 400% price differences.
The law officer cited the Centre's affidavit, asserting that the Indian drug market is competitive, leading to lower prices.
However, the bench pointed out that patients lack bargaining power and are forced to pay exorbitant prices for essential medications.
The justices expressed a desire for all medicines to be treated as generic.
They also questioned the delay in capping the trade margin on anti-cancer drugs at 30% of the MRP.
The bench criticized the government for only acting after being prompted by the court.
Bhati also mentioned the growth of the pharmaceutical sector, but the bench cautioned against prioritizing commerce over patient welfare.
The court previously indicated that the government's response regarding the trade margin cap was inadequate and questioned why similar measures couldn't be applied to other medicines.
The Centre, which faced backlash for the high markup on cancer drugs, stated that the new cap is expected to save patients around Rs 2,500 crore annually.
The bench highlighted that a saline drip sold for Rs 270 in the market costs only Rs 11.
One petition called for authorities to ensure drug formulations are more affordable by curbing unethical pricing practices by pharmaceutical companies and retailers.
Another petition sought disciplinary measures against medical professionals for not prescribing generic medications.