PTI
New Delhi
The Supreme Court on Monday said the Centre’s response on capping the trade margin of anti-cancer drugs at 30 per cent of the maximum retail price (MRP) is “hardly anything to be happy about” and questioned why the government cannot cap trade margins of other medicines.
The Centre, which has earlier come under severe criticism from the top court for steep markup of cancer drugs by hospitals, said the government has taken an important decision to cap the trade margin on anti-cancer drugs at 30 per cent of the MRP, which is expected to result in annual savings of approximately Rs 2,500 crore to patients.
A bench of Justices Vikram Nath and Sandeep Mehta said that the Centre’s response was insufficient and flagged that a single saline drip was sold in market for Rs 270 while its actual cost was Rs 11.
“There is hardly anything to be happy about. There is actually nothing for the benefit of the patients,” the bench observed as Solicitor General Tushar Mehta and Additional Solicitor General Aishwarya Bhati, appearing for the Centre, tried to explain the regime in place.
Mehta said that the government has taken an important step to cap the trade margin on anti-cancer drugs at 30 per cent of the MRP, which would result in savings of approximately Rs 2,500 crore to patients.
Justice Nath told the solicitor general that the court fails to understand that if the government can cap the price of anti-cancer drugs, then why can it not bring all the medicines under this regime.
“We understand that there are transportation costs, raw material cost, R&D cost and all other ancillary costs, but all these are included in the MRP. What is the logic behind allowing them to sell 400 times the actual cost? How can you allow this?” the bench observed.
Bhati said that the cost of medicines in India was the lowest in the world and that is the reason a lot of people come to the country for treatment.
Justice Mehta said that the cost of an India-made cardiac stent is around Rs 5,000 but it is sold by hospitals for more than Rs 25,000 and similarly, the cost of common antibiotic Azithromycin is sold at over Rs 70 while its actual cost is around Rs 28.
Tushar Mehta said that the medicines cannot be capped beyond a limit as higher margins enable them to reach far-flung areas.
Justice Mehta said, “If the DPCO [Drugs (Prices Control) Order]-approved medicines do not reach customers, then it is the duty of the government to ensure it reaches the patient. The actual dispute is what medicine should be in the DPCO controlled list and what should not be.”
The bench gave time to Tushar Mehta to come out with modalities for capping the price of medicines and posted the matter for further hearing on October 27.
“We will be strengthening the hands of the government. Nothing else. Whatever you have to do, do it by October 27,” the bench observed.
