Delhi HC stays Rs 1.35 crore demand slapped on Novartis by NPPA

NEW DELHI: Delhi High Court today stayed drug regulator National Pharmaceutical Pricing Authority's (NPPA) demand of Rs 1.35 crore from pharma major Novartis India Ltd for selling one of its medicines at a higher price after its rate was reduced.

A vacation bench of Justice Mukta Gupta stayed the operation of NPPA's April 29 notice till the next date of hearing on July 25.

The court also issued notice to the Centre and NPPA on Novartis plea seeking their replies before the next date.

Novartis, in its plea, claimed that the government by a June 14, 2013 notification had revised the price of its drug, Regestrone, used for regulating women's menstrual cycle.

It said the notification gave 45 days time for its implementation and Novartis had sold the drug at the older price during this period and the last sale was made on July 4, 2013.

It challenged the demand of Rs 1.35 crore, including interest, raised by NPPA as "arbitrary and misconceived" claiming that the decision was taken without giving it a hearing.

Novartis contended that NPPA had first sought information regarding its sale post-notification and had given all details including audited reports. However, the demand was slapped on it without even issuing a show cause notice.

It has also challenged the 15 per cent interest charged by NPPA on the overcharged amount saying it was contrary to the high court's decision on another matter.