Press Note

1. The Drug Price Control Order, 1995 was promulgated by the Govt. of India on 06.01.95 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 Govt. of India is empowered to fix / notify the prices of scheduled bulk drugs and their formulations under the provisions of DPCO’95.
2. The National Pharmaceutical Pricing Authority was formed by Govt. of India on 29.08.97 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 04.09.97.
3. 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.
4. 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.
5. 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.
6. 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 theses 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 label 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.