DGCI wakes up to e-pharmacies after HC orders, to notify rules soon

Delhi, Madras HC gave conflicting views on online pharmacies

After dillydallying on rules for online pharmacies for nearly two years, the government has finally woken up to the sector and is working to expedite the rules for online pharmacies. The urgency for notifying the rules comes after conflicting observations from the Delhi and Madras High Court (HC).

The Drug Controller General of India will soon notify these rules, a senior official from the agency said. Though the agency has not so far received any complaint against such online pharmacies, these e-shops remain unlicensed in the absence of rules, the official said.

While Delhi HC, which had initially banned online sale of medicines on December 12, extended its ban till January 8, the Madras High Court overturned a single judge order and allowed sale of medicines until formal rules were in place.

The absence of rules for online pharmacies was also one reason why the Delhi HC banned the online sale of medicines. A two-judge bench led by Chief Justice Rajendra Menon and Justice V K Rao of the Delhi HC had on December 18 observed that online pharmacies could start selling medicines once there were some rules in place. “Problem is that today there are no rules regulating it", the two judge bench had observed.

In Madras, six online pharma companies and a Digital Health Platform formed by the major ones in the segment had sought to be impleaded in the original petition moved by Tamil Nadu Chemists and Druggists Association (TNCDA). In their petition before the Madras HC, these companies had said that there were nearly 20,000 people working in the sector, who catered to the demands of nearly 1.5 million people buying medicines online.

TNCDA argues that existing regulations have no provision for selling medicine through the online route. The fact that draft rules for these were under consideration show the current online sales were not legal. Drugs, the association had said in its plea, could only be sold by a registered pharmacist against a prescription, and only from premises for which a licence had been issued by the regulatory authority.

The government had initially thought of allowing only low risk and antimicrobial drugs to be sold by online pharmacies. In the latest draft rules, however, the government has plans of allowing all drugs to be sold online provided pharmacies demand a copy of a doctor’s prescription from the buyer and this prescription is then uploaded to a centralized server with the details of the patient.

E-pharmacy cannot deal in drugs covered by the Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act), tranquilizers as well as drugs listed under Schedule X of the D&C Rules. At present, e-pharmacies require a retail license to sell drugs. These e-pharmacies tie up with local brick and mortar pharmacies to distribute medicines to the consumer.

From a market size of $12.6 billion (Rs 883 billion) in 2009, the Indian pharma market is expected to grow to $55 billion or Rs 3.9 trillion by 2020, with the potential to reach $70 billion in an aggressive growth scenario. The e-pharmacy market has the potential to be huge even if it manages to capture a fraction of the off-line market.

(With inputs from Gireesh Babu)