The Supreme Court on September 29 expressed serious concern over steep markups on cancer and other medicines sold through private hospitals, describing the practice as “carnage” and questioning why a uniform 16% margin could not apply to medicines. A Bench of Justices Vikram Nath and Sandeep Mehta cited an example of a cancer drug supplied to retailers for around ₹2,700 but carrying an MRP of ₹27,000.
The Court also asked the Centre to examine allegations that corporate hospitals require patients to buy medicines from their own or designated pharmacies. The matter concerns medicine pricing, generic prescriptions and medical devices under the Drugs (Prices Control) Order, 2013 (DPCO). The Centre has said it will consult officials and look for a way forward. The next hearing is scheduled for October 12.
A ₹2,700 Drug With a ₹27,000 MRP
The Court’s concern centred on the wide gap between the price at which medicines reach retailers and what patients may ultimately be asked to pay. During the hearing, the Bench pointed to a cancer medicine reportedly supplied to retailers for around ₹2,700 but carrying an MRP of ₹27,000, a tenfold difference. “This is carnage. Plain and simple,” the Bench told Solicitor General Tushar Mehta, questioning the rationale behind such pricing.
The judges also questioned the practice of corporate hospitals requiring patients to purchase medicines through in-house or designated pharmacies. Such restrictions can leave patients with little choice when medicines are priced at or near their MRP. The Court further noted that the consequences extend beyond individual families when treatment is paid for under government-sponsored schemes, as inflated medicine bills can ultimately be borne by taxpayers.
Why Non-Scheduled Medicines Are Under Scrutiny
The proceedings are part of petitions concerning the regulation of medicine prices, generic prescriptions and medical devices under the DPCO, 2013. The Court has also questioned the pricing of non-scheduled medicines, which are not subject to the same ceiling-price mechanism as scheduled formulations. Importantly, the proposed 16% figure is a matter being considered by the Court and is not a uniform cap that has been ordered for all medicines. Under the existing framework, a 16% retailer margin is incorporated into the calculation of ceiling prices for scheduled formulations and certain other categories; it does not automatically mean that every medicine in India can only carry a 16% markup.
The Centre has indicated that it is not taking an adversarial position on the issue and wants to consult officials before responding further. Solicitor General Tushar Mehta said the government would have to find a solution that balances different interests. The Court is expected to examine the issue further, including the distinction between scheduled and non-scheduled medicines and the impact of hospital pharmacy practices on patients. The matter has been posted for October 12.
The Logical Indian’s Perspective
Healthcare becomes especially vulnerable when patients and families have little bargaining power at the point of purchase. Cancer treatment can already involve prolonged and financially demanding care, making transparency in medicine pricing and freedom of choice particularly important. Any policy response should protect patients from unreasonable costs while also considering legitimate expenses across the pharmaceutical and healthcare supply chain.
Clear pricing rules, greater transparency in hospital pharmacies and meaningful access to affordable medicines can help build greater trust between patients, hospitals, pharmaceutical companies and regulators. How can India ensure that life-saving medicines remain affordable without compromising the sustainability of healthcare services?
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