SC Questions Centre Over Steep Medicine Markups
The Supreme Court asks why medicine MRP cannot be capped at 16% above PTR to prevent massive markups on life-saving drugs like cancer medication.
The Supreme Court of India has raised serious questions regarding the massive disparity between the cost at which medicines are supplied to retailers and the prices charged to the general public. During a hearing on Tuesday, a bench comprising Justices Vikram Nath and Sandeep Mehta questioned the Central Government on why a uniform cap is not imposed on the retail prices of medicines and medical devices to prevent excessive markups.
The apex court specifically probed why the Maximum Retail Price (MRP) could not be restricted to a maximum of 16 per cent above the Price To Retailer (PTR), a measure that could prove vital for patients relying on life-saving drugs.
Shocking Disparities in Life-Saving Drugs
The bench highlighted the staggering gap between supply prices and consumer costs, using a specific example to illustrate the gravity of the situation. Justice Mehta pointed out a case involving a cancer drug that is sold to consumers for approximately Rs 27,000, despite its Price To Retailer being only around Rs 3,000. Such a massive difference, the court noted, warrants intense scrutiny.
The petitioners argued that this lack of regulation is largely due to the current structure of the Drugs (Prices Control) Order, 2013. According to the plea filed by Kishan Chand Jain, approximately 82 per cent of medicines currently fall outside the "scheduled" category. Because these non-scheduled medicines are not subject to ceiling prices, manufacturers enjoy significant flexibility in fixing high MRPs.
Impact on Public Funds and Government Schemes
The Supreme Court also noted that inflated medicine prices do not just affect individual patients; they also place a heavy burden on the national exchequer. The court observed that when patients receive treatment under government-funded health schemes, such as Ayushman Bharat, high costs directly impact public funds. This is particularly concerning in instances where hospitals require patients to purchase medications from in-house pharmacies.
The petition has sought several key interventions, including:
- Mandatory generic prescriptions to reduce costs.
- Regulation of the initial prices for non-scheduled medicines.
- Strict price caps on various medical devices.
Centre's Response and Next Steps
Representing the Central Government, Solicitor General Tushar Mehta acknowledged the concerns raised by the petitioners. He stated that the government would need to work out a balance between regulation and availability.
The legal battle over medicine affordability continues, with the Supreme Court scheduled to hear the matter again on October 12.