Cipla gets demand notices for overpricing 2 drugs

PTI New Delhi | Updated on November 10, 2017 Published on December 28, 2010

Medicines produced by CIPLA   -  BusinessLine

Drug firm Cipla today said it has received fresh notices from National Pharmaceutical Pricing Authority (NPPA) for Rs 73.16 crore for overpricing of two drugs.

The company has received further demand notices from the Government demanding an amount of Rs 47.70 crore in respect of the drug Salbutamol and an amount of Rs 25.46 crore in respect of the drug Ciprofloxacin, Cipla said in a filing to the Bombay Stock Exchange (BSE).

“These demands are contrary to the orders of the Supreme Court and the company has received legal advice that entire amount demanded by the Government is not tenable and sustainable,” the company said.

Leading pharmaceutical firms Cipla and Ranbaxy are among those which have been pulled up by the NPPA for overcharging.

According to the information available on the NPPA Web site, as on October 31, 2010, the total estimated overcharged amount, including interest, by various pharma companies since the inception of the NPPA in 1997 stood at a whopping Rs 2,208.35 crore.

But so far, the Authority could recover a paltry Rs 202.20 crore from this and is fighting litigations in various courts with the companies to recover the rest of the sum.

The NPPA was established on August 29, 1997 as an independent body of experts with the task of fixing and revising drug prices, both bulk drugs and formulations, to ensure their availability.

Under the Drugs Prices Control Order of 1995, the NPPA is empowered to fix and regulate the prices of medicines, produced by using 74 out of about 500 commonly used bulk drugs, kept under statutory price control.

Under this provision, the Authority can prosecute any drug maker found overcharging under the Essential Commodities Act and can recover the amount along with interest. - PTI

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Published on December 28, 2010
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