The Drug Price Control
Order, 1995 was promulgated by the Government of India on 6.1.95
under Section 3 of Essential Commodities Act, 1955. Under DPCO’95,
76 bulk drugs (reduced to 74 subsequently) are included in the
first schedule. The Government of India is empowered to fix/notify
the prices of scheduled bulk drugs and their formulations under
the provisions of DPCO’95.
The National
Pharmaceutical Pricing Authority was formed by Government of India
on 29.8.97 and the various powers relating to price fixation of
the scheduled bulk drugs and formulations based thereon, implementation,
monitoring and enforcement of the prices so fixed were delegated
to NPPA by Union of India on 4.9.97.
Under various
provisions of DPCO, 1995, NPPA/Union of India is empowered to
fix/ revise the prices of bulk drugs and formulations. These prices
are to be implemented by the manufacturers within 15 days of the
notification.
Under Para 14
(1) of Drug Prices Control Order, 1995 the manufacturers are required
to implement the prices fixed/revised by NPPA/ Union of India
within 15 days of the notification. The manufacturers are also
required to issue revised price list under Para 14 (3) of DPCO,
1995.
Under Para 16
of DPCO, 1995 no person shall sell any bulk drug or formulation
to any consumer at a price exceeding the price specified in the
current price list or price indicated on the label or pack whichever
is less.
In the W.P. No.38973/98
filed by M/s. Smithkline Beecham vs. Union of India in the High
Court of Karnataka, the Hon’ble Lordships duly considered Para
9, Para 14, Para 16 and Para 24 of DPCO and delivered the Judgement
on 12.11.2002. The Hon’ble Lordships have observed as under:
"Thus, a
combined reading of these provisions make it clear that every
manufacturer and distributor is duty bound to issue a revised
price list within 15 days from the date of the notification issued
by the Government under Para 9 of DPCO. It is also clear that
manufacturers, distributors and retailers will be liable to sell
formulations from the date of such revised price list (which is
required to be published within 15 days from the date of notification)
at the revised prices and not the prices mentioned on the lable
of the container or pack. In view of it, the contention of
the petitioner that revised prices will not apply to the existing
stocks but only to new batches of drugs and formulations to be
manufactured after 15 days of the notification cannot be accepted.
The provisions of the DPCO are clear that prices should be revised
within 15 days even in regard to the formulations which were manufactured
prior to the date of notification or those manufactured within
15 days from the date of notification."
In view of the
above, all the manufacturers are directed to implement the prices
in respect of bulk drugs/ formulations fixed/notified by NPPA
within 15 days of the notification and ensure that the stocks
are sold after the stipulated period only at the prices fixed
by the NPPA.
