Drugs pricing row: 7 pharmaceutical companies move HC against Centre’s order

The finance ministry last week exempted drug makers from the excise duty on repacking or relabeling, an exception available for 45 days.NEW DELHI: Top officials in the department of pharmaceuticals will meet drug makers in Mumbai on Wednesday to address their concerns over implementing the new drug price control order, which made it mandatory for drug manufacturers to sport revised price labels on essential medicines from July 29.

The meeting, chaired by secretary in the department of pharmaceuticals and chairman of the National Pharma Pricing Authority, is likely to be attended by health secretaries of Gujarat and Maharashtra, drug regulators of the two states and officials from the central excise department.

The meeting comes even as pharmaceutical companies queue up at courts challenging a provision under the new drug price control order, which says essential drugs must have labels of revised prices within 45 days of government notification. “The drugmakers have been complaining about the immense logistical and other issues they are facing while making the transition to the new drug price regime. We would be meeting them to discuss their problems and possible solutions to ensure that the companies get a fair opportunity to crossover to the new pricing regime,” an official said.

The finance ministry last week exempted drug makers from the excise duty on repacking or relabeling, an exception available for 45 days after the prices of the essential drugs are notified by National Pharma Pricing Authority.

Over the past fortnight, over a dozen drug firms and two industry bodies- the Indian Drug Manufacturers Association and the Confederation of Indian Pharma Industry-havechallenged the order to label revised prices within 45 days of the price notification in theDelhi High Court. Among the companies that have approached the court include CiplaBSE -0.34 %, Sun Pharma, Micro Labs, Lupin, Wockhardt, Intas Pharma, Alembic Pharma andEmcure Pharma.

According to some lawyers ET spoke to, at least 20 other companies are preparing to file similar cases.

The court has asked the government not to take coercive action against the companies that have moved the court. It has, however, also asked the companies to furnish price lists of essential drugs they manufacture as mandated under the new Drug Price Control Order to domestic drug distributors and state drug controllers.

Late last week, the court also directed the firms to file copies of the agreements they enter with their stockists and distributors within two weeks. It asked the companies for a record of drugs sold before and after the cut-off date when the DPCO was enforced.

For the first set of 151 essential drugs, prices of which were notified in June, the drug price control order came into effect on July 29. Recounting problems drug makers are facing while implementing the provision, a pharma firm executive said, “Besides tablets and capsules, many essential drugs are also sold as drops, vials, bottles and intravenous forms. In these cases, labeling is carried out at the manufacturing facility itself.”

Many of the retailers affix their own bar codes for managing their inventory, which makes it difficult for the company to redo the labeling without damaging the packing, rendering them unsaleable, another drug firm executive said.

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