The Supreme Court Tuesday expressed serious concern over steep mark-ups on life-saving medicines, particularly cancer drugs, describing as “broad daylight dacoity” a pricing structure under which a medicine supplied to a retailer for around Rs 2,700 could carry a maximum retail price of Rs 27,000.
A bench of Justices Vikram Nath and Sandeep Mehta raised the issue while hearing petitions concerning regulation of medicine prices, prescription of generic medicines and price caps on medical devices. The court questioned why such a wide gap between the Price to Retailer (PTR) and Maximum Retail Price (MRP) was permitted and also expressed concern over the response of regulatory authorities.
‘People sell houses’
Referring to an essential cancer medicine cited before the court, Justice Mehta pointed to the ten-fold difference between its PTR and MRP and questioned how patients could be subjected to such pricing.
“If that is not extortion, what else is it? People sell their houses, people sell their ornaments for getting the medicines,” the bench observed during the hearing.
The court described the disparity as “absolute rampage and carnage” and “broad daylight dacoity” against patients. It also questioned why authorities responsible for regulating medicine prices had remained silent on such large differences between the cost to retailers and the price printed on medicine packs.
The bench’s observations came after petitioner Kishan Chand Jain, appearing in person, raised concerns over the pricing framework for non-scheduled medicines under the Drugs (Prices Control) Order, 2013. Jain argued that while price ceilings apply to scheduled medicines, manufacturers of non-scheduled formulations have greater freedom in fixing their initial prices.
He submitted that once the initial price of a non-scheduled medicine is fixed, the regulatory framework primarily restricts subsequent annual increases, rather than controlling the price at which the product is first introduced.
Taxpayer burden flagged
The court also highlighted the implications of high medicine prices for public finances, particularly when treatment is covered by government-funded health schemes.
It observed that when medicines are provided as part of treatment under schemes such as Ayushman Bharat, hospitals can seek reimbursement from the government, meaning the expenditure ultimately comes from taxpayers.
The Centre, represented by Additional Solicitor General K M Nataraj, told the court that the government remained committed to making medicines affordable and was open to measures that could improve the existing framework. The government also referred to initiatives such as the Pradhan Mantri Bhartiya Janaushadhi Pariyojana aimed at expanding access to affordable generic medicines.
Senior advocate Kapil Sibal, appearing for the Indian Pharmaceutical Alliance, submitted that the entire difference between MRP and the price further down the supply chain should not automatically be treated as profit retained by pharmaceutical manufacturers. He urged the court to examine the pricing chain, including the rates at which medicines are supplied to stockists and retailers.
How prices are regulated
Under the existing system, the National Pharmaceutical Pricing Authority fixes ceiling prices for formulations included in Schedule I of the Drugs (Prices Control) Order, which draws from the National List of Essential Medicines. Manufacturers of scheduled formulations cannot sell above the prescribed ceiling price, apart from applicable taxes.
As of July 2026, ceiling prices were in force for 935 formulations. The government has also said ceiling prices for 131 scheduled anti-cancer formulations are in effect. For non-scheduled formulations, prices are monitored and manufacturers are generally prohibited from increasing the MRP by more than 10 per cent over the preceding 12 months.
The petitioners, however, have questioned whether the framework adequately addresses the initial pricing of medicines and the large trade margins that can emerge between the manufacturer, distribution chain and patient.
The Supreme Court will continue hearing the matter on September 29.