NEW DELHI: The Supreme Court on Tuesday questioned the Centre over the significant gap between the maximum retail price (MRP) of medicines and the prices at which retailers purchase them, asking why the system appeared to favour pharmaceutical manufacturers.
Responding to the court’s concerns, the Centre said the government’s policy was that the entire ecosystem should not be brought under regulatory control.
"Why is the entire system working to help these people (manufacturers)," a bench of Justices Vikram Nath and Sandeep Mehta asked during the hearing.
It observed that the National Pharmaceutical Pricing Authority (NPPA) seems to be a "totally defunct" body.
The bench was hearing two petitions, which flagged the issue of pricing of medicines in the country.
Referring to the massive difference between the MRP and the price to the retailer, the bench said, "The government is allowing this to happen. It is under the government's own eyes that it is happening.”
"Should it be allowed to run amok?" the bench asked.
Additional Solicitor General Aishwarya Bhati, appearing for the Centre, told the bench that medicine prices in India were among the lowest in the world.
The bench reserved its order in the matter.
While hearing the matter on October 12, the top court had said the Centre's response on capping the trade margin of anti-cancer drugs at 30 per cent of the maximum retail price (MRP) was "hardly anything to be happy about" and questioned why the government cannot cap trade margins of other medicines.
The Centre, which had earlier come under severe criticism from the top court for steep markup of cancer drugs by hospitals, said that 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.
