The Supreme Court on 29 September 2026 expressed alarm over the huge gap between the price at which essential medicines reach retailers and the price consumers pay, especially for cancer drugs. The Court questioned why the Drugs (Prices Control) Order (DPCO) 2013 allows a uniform 16% retailer margin on the MRP of all essential medicines.
Key Developments
- Justices Vikram Nath and Sandeep Mehta asked the Centre to apply the 16% margin uniformly to curb steep mark‑ups.
- Justice Mehta highlighted a near ten‑fold increase on an essential cancer drug: supplied to retailers at ~₹3,000 but sold to patients at ₹27,000.
- Solicitor General Tushar Mehta argued that private hospitals, not pharma firms, reap the profit.
- The Court noted that private hospitals force patients to buy medicines from their in‑house pharmacies, limiting cheaper alternatives.
- When treatments are covered under Ayushman Bharat, the inflated cost is ultimately borne by taxpayers.
Important Facts
• The current margin under DPCO is 16% of the MRP. • The Court described the price gap as “carnage” and earlier as “dacoity”. • The matter has been adjourned to 12 October 2026 for the Centre to submit details of existing pricing mechanisms.
Exam Relevance
Understanding the Supreme Court’s role in health‑care regulation (GS2: Polity) and the economic impact of drug pricing (GS3: Economy) is essential for both the Polity and Economy papers. The case illustrates how public‑policy tools like the DPCO intersect with social welfare schemes such as Ayushman Bharat. It also raises ethical questions about profiteering in private hospitals (GS4: Ethics).
Way Forward
- Centre should consider extending the 16% margin uniformly to all essential medicines under DPCO.
- Introduce stricter monitoring of in‑house pharmacy practices in private hospitals.
- Enhance transparency of the supply‑chain cost structure to identify where excess profits accrue.
- Align drug‑price controls with public‑health financing to protect taxpayers and patients.
The Supreme Court’s intervention signals a possible tightening of price‑control mechanisms, a development that UPSC candidates must track for its implications on health‑care policy, fiscal burden, and consumer protection.