Madras HC dismisses Ban on online sales of medicine in India

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The Madras High Court has put a full stop on the order that banned the online sales of drugs, cosmetics and prescribed medicines till it announces a final decision on the matter. The order was passed on 2nd of January by the division bench of the High Court which comprised Justice P Rajamanickam and Justice M Sathyanarayanan. The bench earlier suspended the single judge order and hs now provided relief by giving the final order.

Pradeep Dadha, founder and CEO, Netmeds.com said to Inc42, “We are extremely grateful for the observations made by the bench which validates the work that we have put in for the last three years. As part of the observations, the bench recognised that mechanisms are in place to prevent any real abuse of process by the online pharma sector. One of the most pertinent observations made was that the Central Government is not opposed to online pharmacies, and is actively putting in place systems for regulating the sales.”

The bench observed that the online sales were going on without any major problem for a quite long time, and shutting the services down can affect the industry, as well as many, will lose jobs in the run. Also, it noted that people are not always in a position to set foot outside to buy medicines. Online pharmacies have been bringing a lot of transparency as well as provide medicines at a cheaper rate by enhancing the supply chain.

Earlier the division bench of Delhi High Court comprising Chief Justice Rajendra Menon extended the interim order which banned the online sales of drugs till January 8, 2019. Prior to that in October 2018, the Madras High Court issued a country-wide interim ban on online drug retailers which alarmed the investors who have already invested more than INR 300 crores in online pharmacies.

The Tamil Nadu Chemists and Druggists Association (TNCDA) filed a petition before the single judge and impleaded six online pharmacies and a platform formed by the major online pharmacies. The companies appealed and informed the court that they have neither violated a single rule or regulation nor will violate any in the future. There exist two types of online pharmacies in India, the one who acts as a marketplace to connect registered pharmacists and the customers while the other has their own registered pharmacists and stocks.

In December 2018, Justice Pushpa Sathyanarayana passed an order which directed the central government to bring in e-pharmacy rules in the Gazette at the earliest with a deadline till 31st of January 2019 in the interest of citizens of India. The companies selling drugs online have to obtain a licence in the manner prescribed within a period of two months from the date of notification under the rules.

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The Indian pharmaceutical industry is expanding at a voluptuous rate. According to IBEF, it was valued at $33 billion in 2017 which is expected to grow at a CAGR of 22 per cent and reach the $55 billion mark till 2020. India’s pharmaceutical exports stood at US$ 17.27 billion in 2017-18. In 2018-19 these exports are expected to cross US$ 19 billion. During April-June 2018, pharmaceutical sector in India witnessed private equity and venture capital investments of US$ 396 million.

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Adid Khan
Hello! I am Adid Khan, a marketer, entrepreneur, travel junkie and foodie. I love travelling, meeting new people, eating and eating. My journey started as a hacker.

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