JOIN USKarnataka High Court upholds 30% cap on trade margin for select anti-cancer drugs
The high court has upheld the order imposing a cap of 30 per cent on trade margin upon manufacturers for select anti-cancer drugs. Justice M Nagaprasanna observed that it is a policy decision of the central government taken in public interest.
The petition was filed by Healthcare Global Enterprise Limited, Bengaluru, which operates around 20 cancer care centers across India. The petition claimed that the National Pharmaceuticals Pricing Authority, which has issued the notification, is not empowered under the Price Control Order to fix ceiling price or retail price of non-scheduled formulations.
It said the non-scheduled formulations are to be determined only by the market force and cannot be subject to any regulation. It was argued that the 30 per cent is arbitrary and imposes an unreasonable restriction on its right under Article 19 (1) (g) of the Constitution of India (right to trade).
On the other hand, the Union government defended the notification contending that essential drugs can be placed under the price control order for the public good as the market forces are charging 900 per cent over and above the manufacturing cost and the cap is on all the anti-cancer drugs.
“What the petitioner seeks to contend by way of a challenge to the government order is that his profit would come down as he is only a retailer and the cap is on the manufacturer but the effect is on the retailer. This cannot be a ground for a judicial review of the impugned policy much less, on the ground that it violates Article 19(1)(g) of the Constitution of India,” the court said.
Justice Nagaprasanna also said, “Cancer patients in India incur heavy expenditure and cancer drugs need to become somewhat affordable so that whenever a treatment is required, it can be treated at the earliest, to the rich and the poor alike. If such policy is not promulgated, the poor or the middle class which forms a majority of the population of this country, can be seen to be succumbing to the disease due to high prices that the manufacturers project resulting in its unaffordability. Therefore, the challenge to the government order by a retailer whose motive inter alia is profit and the challenge inter alia is loss of profit, cannot be countenance,” Justice Nagaprasanna said.