Case Note & Summary
The writ petition, filed as a public interest litigation, brought to the court's attention the stark and arbitrary price differences in identical drug formulations sold by various pharmaceutical companies across India. The petitioner, through the annexed list, demonstrated that drugs such as Cetrizine, Ciprofloxacin, Gabapentin, and many others were available at prices ranging from a few rupees to several hundred rupees for the same strength and quantity, depending solely on the manufacturer. For instance, a 10-tablet strip of Flunarizine 10 mg for migraine cost Rs. 19.90 from one company and Rs. 52.00 from another; a vial of Zoledronic Acid 4 mg for cancer treatment was priced at Rs. 2,800 by Cipla and Rs. 12,500 by Novartis. This enormous disparity was alleged to be a result of the absence of price regulation for non-scheduled formulations and the unfettered discretion of manufacturers to set retail prices. The petitioner contended that this practice violated the public's right to affordable healthcare and urged the court to direct the government to exercise its powers under the Drugs (Prices Control) Order, 1995 (DPCO). The respondents, including the Union of India through its ministries, the National Pharmaceutical Pricing Authority, and the State drug authorities, were impleaded. The Union of India, represented by its counsel, argued that the petitioner had not formally approached the pricing authority with these discrepancies, and therefore the authority had no occasion to invoke its suo motu review powers. The State and its food and drug administration officials did not raise any substantial objection to the factual matrix. The High Court, after hearing the amicus curiae and counsel for the parties, examined the scope of Rule 10(b) of the DPCO. This rule empowers the government to fix or revise the retail price of any formulation, whether scheduled or non-scheduled, if it considers it necessary in public interest. The court found that the drugs listed were indeed non-scheduled and that the price disparities were prima facie excessive and detrimental to public interest. It held that such practices are a matter of public concern and that the government is duty-bound to consider intervention when public interest is at stake. Consequently, the court did not delve into the merits of specific price hikes but instead directed the respondent authorities to treat the petition as a representation, consider the price discrepancies enumerated in the list, afford an opportunity of hearing to the petitioner and the manufacturers concerned, and pass a reasoned order in accordance with law within six months. The respondents were also ordered to file a compliance report with the court. The rule was made absolute with no costs. The judgment underscores the regulatory role of the state in ensuring that essential medicines are accessible at reasonable prices, and that the DPCO provides a potent tool to curb exploitative pricing in the pharmaceutical sector.
Headnote
A) Drugs Law - Price Control - Power to revise retail price of non-scheduled formulations in public interest - Drugs (Prices Control) Order, 1995, Rule 10(b) - The Court, upon noticing a wide disparity in prices of identical drug formulations manufactured by different companies, held that such price variation is a matter of public concern under Rule 10(b) - Directed the respondent authorities to consider these discrepancies, hear the petitioner and manufacturers, and pass a reasoned order within six months, submitting a compliance report to the Court (Paras 4-7).
Issue of Consideration
Whether the wide disparity in prices of the same drug formulations from different manufacturers constitutes a matter of public interest warranting government intervention under Rule 10(b) of the Drugs (Prices Control) Order, 1995.
Final Decision
The High Court directed respondents to consider the price discrepancies, hear the petitioner and manufacturers, and pass a reasoned order within six months; compliance report to be submitted to the court.
Law Points
- Government has power under Rule 10(b) of Drugs (Prices Control) Order
- 1995 to revise retail price of any formulation including non-scheduled formulations in public interest
- wide disparity in prices of identical drugs is a matter of public concern.
