Distribution of Freebies to Doctors to Increase the Sale of Drugs

Case Description

In February, 2021, the Federation Of Medical And Sales Representatives Associations Of India, an NGO, filed a writ petition asking the Supreme Court to frame guidelines to control unethical marketing practices by pharmaceutical companies. The petition asks the court to frame guidelines until the Parliament passes a law for this purpose.

The NGO claims that the conduct of pharmaceutical companies in their interactions with doctors is currently unregulated in India. The   Indian Medical Council (Professional Conduct, Etiquette and Ethics) Regulations of 2002 prescribes a code of conduct for doctors in their relationship with the pharmaceutical companies, however it does not regulate the companies. While doctors’ licence gets revoked for malpractices, the  companies do not get penalised. Companies project freebies to be ‘sales promotion’. The petition, however, states that  they are direct or indirect advantages offered to doctors as gifts in exchange for an increase in drug sales.

According to the petition, unethical drug promotion can adversely influence doctors’ prescription attitudes and harm human health by 

1. over-use/ over-prescription of drugs, prescription of higher doses of drugs than necessary;
2. prescription of drugs for a longer period than necessary, prescription of a higher number of drugs than necessary and 
3. prescription of an irrational combination of drugs.

The pharmaceutical companies are accused of using high-pressure promotion practices to ask doctors to prescribe an irrational combination of drugs to generate high sales. The NGO argues that such practices directly affect citizens’ health, violating their rights under Article 21 of the Constitution.

The petition  alleges that there are abundant examples to show how corruption in the pharmaceutical sector endangers positive health outcomes and puts patients’ health at risk. It states that violations of this kind have become a recurring phenomenon and are becoming progressively worse. The NGO has asked the Court to establish a statutory code of ethical marketing for the pharmaceutical industry, with penal consequences. 

Justices DY Chandrachud and Surya Kant admitted the petition for hearings in March 2022.On August 18th, 2022, Sr. Adv. Sanjay Parikh informed the Bench of Central Board Of Direct Taxes’ allegation that the manufacturers of the popular tablet Dolo-650 spent Rs. 1000 crores, in giving freebies to doctors who prescribed it to patients. The Court took note of this fact and directed the Union government to file a reply in 10 days.