In a setback for drugmaker Cipla, the Supreme Court on Friday ruled in favour of the Centre in a case involving overpricing of certain medicines by the company.

The company said the latest ruling follows an appeal filed against it and others arising from an earlier judgment by the Allahabad High Court. The other petitions filed in the Bombay High Court on completely separate grounds relating to alleged overcharging are pending and are still subject to the interim stay granted by the Supreme Court, a note from Cipla said.

The cases involve alleged overcharging on certain medicines under the Drugs (Prices Control) Order (DPCO) 1995. Further clarification was not available from Cipla regarding the apex court directive. An industry expert explained that there are multiple cases on alleged overcharging against Cipla and other local and foreign companies in different courts in the country.

There is an ongoing case that involves the conversion and packaging costs that are mandated to be revised every year under the DPCO. But this may not involve a major penalty on the company.

However, in another overcharging-related case, Cipla has till date received demand notices to the tune of ₹1,768 crore from the National Pharmaceutical Pricing Authority. Earlier this year, though, the apex court had directed Cipla to pay ₹175 crore to the government in this case.

A pharma industry analyst said the company may have an avenue open for appeal if the case was heard by a single judge; it can approach a Bench. The case dates back to 2003, but it has ramifications for other companies involved in similar price-related challenges, the expert said. Cipla’s share price fell over 2 per cent, to ₹582, on the BSE on Friday.

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