SC upholds NPPA's demand against Sun Pharma for overcharging on drug
This story was originally published at 22:02 IST on 15 July 2024
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NEW DELHI – The Supreme Court today upheld the National Pharmaceutical Pricing Authority's demand of 46.51 mln rupees against Sun Pharmaceutical Industries Ltd for charging in excess of the government notified price for Roscilox, a brand of a Cloxacillin-based drug formulation. The apex court said it did not find any error committed by the high court in its order rejecting Sun Pharmaceutical's claim.
"The appeal is devoid of merit and is accordingly dismissed," said the Bench of Justices Sanjay Kumar and Augustine George Masih.
The top court was hearing an appeal by Sun Pharmaceuticals challenging the demand raised by the pricing authority to recover the price for Roscilox charged by the company, which was higher than that fixed by the government under provisions of the Drugs (Price Control) Order, 1995.
"The intent and purpose thereof are to control the prices at which medicinal drug formulations are made available to the common man by holding out the threat of recovery of the higher prices charged for such drug formulations by those involved in their manufacture and marketing," said the court. "Given the laudable objective underlying the provision under Drugs (Price Control) Order, it cannot be subjected to a restricted or hidebound interpretation," it added.
In 2005, the pricing authority had issued a demand notice to Sun Pharmaceuticals directing it to deposit the overcharged principal amount of 21.56 mln rupees for the period between April 1996 and July 2003. It also issued a demand notice quantifying the interest payable on the overcharged amount as 24.95 mln rupees. Consequently, Sun Pharmaceuticals was directed to deposit the overcharged amount along with interest, aggregating to 46.51 mln rupees. In 2014, the high court had upheld the pricing authority's move against Sun Pharmaceuticals.
Today, shares of Sun Pharmaceuticals Industries ended 0.6% higher at 1,586.20 rupees on the National Stock Exchange. End
Reported by Surya Tripathi
Edited by Tanima Banerjee
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