In a relief to pharma majors, the Delhi High Court today held as "illegal and unsustainable" the Centre's decision to put a ceiling on the price of condoms, including the luxury variety.
A bench of Chief Justice G Rohini and Justice Rajiv Sahai Endlaw set aside the National Pharmaceutical Pricing Authority (NPPA's) orders capping prices of male contraceptive devices, saying it exceeded the powers conferred upon it under the Drug Price Control Order (DPCO) of 2013.
"We are of the view that NPPA exceeded the powers conferred by DPCO-2013 while fixing the ceiling price for condoms. The language of para 4 (of DPCO 2013) is unambiguous and makes clear the legislative intent that the ceiling price can be fixed only for scheduled formulations of specified strengths and dosages as specified under the First Schedule.
"Therefore, according to us, the provisions of para 4 cannot be made applicable to condoms, the dosage and strength of which have admittedly not been specified under the First Schedule," it said.
"Consequently, fixation of the ceiling price for condoms under DPCO-2013 is impermissible under law. Accordingly, we declare that the orders of NPPA dated November 5, 2013, and July 10, 2014, are illegal and unsustainable. In the result, both the said orders are hereby set aside," the court said.
It was also of the view that inclusion of condoms in DPCO 2013 was not ultra vires of the provisions of the Essential Commodities Act, saying it was a "medicine as well as a substance for use of human beings for mitigation or prevention of a disease or disorder" as provided under the Drugs and Cosmetics Act, 1940.
It said, therefore, that condoms are drugs as per the Drugs and Cosmetics Act, and "are also essential commodities".
Pharma companies Reckitt Benckiser and J K Ansell Ltd (JKAL) in their pleas challenged the two NPPA orders and contended that condoms were not drugs, but were rather devices and thus, cannot be included in DPCO 2013.
NPPA by its November 5, 2013 order had initially capped condom prices at Rs 6.56 per unit and this was later increased to Rs 8.04 by its July 10, 2014, notification.
