W.P.(C)/10837/2017 of INTAS PHARMACEUTICALS LIMITED AND ANR. Vs UNION OF INDIA AND ANR.

*IN THE HIGH COURT OF DELHI AT NEW DELHI+W.P.(C) 10837/2017 and CM APPL. 44445/2017INTAS PHARMACEUTICALSLIMITED AND ANR.

..... PetitionersThrough:Mr Akhil Sibal, Senior AdvocatewithMrRishiAgarwala,MrPradeep Chindra, Mr ParminderSingh, Mr Parinay T. Vasandani,Ms Aarushi Tiku, Advocates.withMrRishiAgarwala,MrPradeep Chindra, Mr ParminderSingh, Mr Parinay T. Vasandani,Ms Aarushi Tiku, Advocates.

versus

UNION OF INDIA AND ANR.

..... RespondentsThrough:Mr Dev P. Bhardwaj, CGSC forUOI.

CORAM:HON'BLE MR. JUSTICE VIBHU BAKHRUO R R%12.04.2019

1.The petitioners have filed the present petition, inter alia, impugningan order dated 07/13.11.2017, whereby the petitioners have been calledupon to pay sum of ₹61,72,373/- on account of the price overcharged by the petitioners in respect of its formulation ‘Cloba MT 5 mg tablets’containing Clobazam-5mg. The said amount is inclusive of interestcalculated up to 30.11.2017. The petitioners also impugn an order dated27.12.2017 passed by the National Pharmaceuticals Pricing Authority(hereafter ‘NPPA’), whereby the petitioners’ contention that the drug‘Cloba MT 5mg’ is outside the purview of the Drugs (Price Control)Order, 2013 (hereafter ‘DPCO-2013’), was rejected.

2.Although, Clobazam 5mg is scheduled formulation and isincluded in the National List of Essential Medicines 2015 ‒ which is

incorporated as Scheduled-I to the DPCO-2013 ‒ the petitioner claims that its drug has novel delivery system, inasmuch as, it is mouthdissolving tablet (MDT). It is claimed that MDT formulations cater tospecific needs of geriatric patients who have difficulties in swallowing orhave dysphagia or risk of chocking or hand tremors and deterioration ineye-sight, hearing, memory etc. The petitioners claim that its drug isinherently unique and is completely distinct and different from theconventional Clobazam tablet.

3.The petitioner relies on Explanation (2) to Schedule-I of theDPCO-2013 and contends that by virtue of the said explanation, noveldrug delivery systems are not to be considered as included in Schedule-Iof DPCO-2013, if the same are not specifically mentioned. It is stated thatSchedule-I only includes the conventional form of Clobazam and not theMDT version of the said formulation.

4.The learned counsel appearing for the parties state that the presentcontroversyiscoveredbythedecisionofthisCourtinIntasPharmaceuticals Limited and Anr. v. Union of India and Anr.: W.P.(C)1257/2018, decided on 17.09.2018. The said decision was rendered in thecontext of drug ‘Ceftas 400 Tablet’. Although, the said drug containedCefixime which is scheduled formulation, the petitioner claimed that‘Ceftas 400’ is disbursable tablet which is novel formulationcompletely distinct and separate from the conventional Cefixime tablet.

5.The operative part of the said decision is set out below:-

“32. plain reading of the impugned order indicates that

NPPA has proceeded on the basis that irrespective of theincremental innovation or the novelty of the drug deliverysystem, all versions of the formulations would be included.As noticed above, this contention is unsustainable. This isalsotheviewexpressedbythisCourtinModi-Mundipharma Pvt. Ltd. v. Union of India & Ors: W.P.(C)11802/2016, decided on 17.07.2018 and Indoco RemediesLimited v. Union of India and Anr: W.P.(C) 7597/2018,decided on 26.07.2018.

33.In this view, NPPA has not proceeded to examinewhether the petitioner’s claim that Ceftas is novelformulation and totally different, distinct and separate fromthe conventional Cefixime tablets. NPPA has not examinedwhether it is significant improvement, developed throughinnovative technology, over the conventional Cefixime400mg tablet.

34.This Court is of the view that it would be necessary forthe NPPA to examine these aspects in order to determinewhether Ceftas is included in Schedule-I of DPCO-2013.

35.The import of Explanation (2) to Schedule-I of theDPCO-2013 is to clarify that medicines, which have addedqualities and attributes that are substantial enough to renderthe said medicine dissimilar to the one entered in Schedule-Iof DPCO-2013 are excluded from the scope of Schedule-I.It would, thus, be essential for NPPA to also examinewhether the different delivery system (as claimed byINTAS) is substantial improvement with significanttherapeutic advantages so as to consider the productmaterially different from conventional version. Clearly,minor changes or minor improvements would not besufficient to exclude such formulations from Schedule-I ofthe DPCO- 2013.

36.In view of the above, the impugned order is set asideand the matter is remanded to the NPPA to consider afreshin the light of the observations made herein. The pending

application also stands disposed of.”

6.In view of the above, the impugned orders dated 7/13.11.2017 and27.12.2017 are set aside and the matter is remanded to NPPA to considerit afresh in the light of the observations made in Intas PharmaceuticalsLimited and Anr. (supra).

7.The pending application is disposed of.

8.The parties are left to bear their own costs.

APRIL 12, 2019RK

VIBHU BAKHRU, J