Supreme Court Questions Rs 27,000 MRP For Cancer Drug Sold At Rs 3,000
Court examines steep drug pricing and hospital pharmacy practices.
The Supreme Court on Tuesday questioned the wide gap between the price at which medicines are supplied to retailers and the maximum retail price charged to patients, particularly in the case of cancer drugs. A Bench of Justices Vikram Nath and Sandeep Mehta cited an example of a cancer medicine available to retailers for around Rs 3,000 but carrying an MRP of Rs 27,000. The Court questioned why such a substantial difference should be permitted.
The Bench asked the Centre whether a uniform margin of 16 per cent could be considered across medicines. It also raised questions about the existing distinction between scheduled and non-scheduled medicines under the country's price-control framework. The Court sought to know why similar criteria could not be applied more broadly to pharmaceutical products to address large differences between procurement prices and printed MRPs.
The Court also examined the pricing practices of corporate hospitals and their in-house pharmacies. It observed that patients are sometimes required to purchase medicines from hospital pharmacies at prices linked to high MRPs and questioned the practice of hospitals refusing to assure treatment when patients obtain medicines from outside pharmacies. The Bench also considered the financial implications for taxpayers when inflated medicine costs under government-sponsored health schemes are later reimbursed from public funds.
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Solicitor General Tushar Mehta, appearing for the Centre, acknowledged the need to address the issue but said a balance would have to be maintained between competing interests. He told the Court that he would consult government officials and return with a response. The Centre's counsel also submitted that pharmaceutical manufacturers may not necessarily be the main beneficiaries of the large price difference, suggesting that private hospitals could be retaining a substantial portion of the margins.
The Bench further noted that excessive differences between the actual selling price and printed MRP could affect consumer confidence. It pointed out that if a chemist sold a medicine carrying an MRP of Rs 27,000 for Rs 3,000, patients might even suspect that the cheaper medicine was counterfeit because of the unusually high printed price. The Court's observations came during a petition filed by Kishan Chand Jain seeking mandatory prescriptions for generic medicines, regulation of initial prices of non-scheduled medicines and price caps on medical devices.
The case is also examining gaps in the existing drug-price control framework. The Supreme Court had last week criticised a 10-fold difference between the price to retailers and MRP of a cancer drug, using strong language to describe the impact of such pricing on patients. The Court has granted the Centre additional time for inter-departmental consultations and listed the matter for further hearing on October 12.
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