The NPPA is required to review its orders considering jurisdiction and procedural fairness, particularly regarding a patented drug's exemption under the Drug Price Control Order.

JUDGMENT

D.N.Patel, Chief Justice (Oral)--Proceedings in the matter have been conducted through video conferencing.

C.M.No.6284/2021 (exemptions)

2. Allowed, subject to all just exceptions.

The application is disposed of.

W.P.(C) No.2162/2021 & C.M.No.6283/2021(stay)

3. This writ petition has been preferred with the following prayers:-

"(a) Pass an appropriate writ, order or declaration quashing the Gazette Notification dated February 27, 2019 issued by the Respondent No.1/NPPA;

(b) Pass an appropriate writ, order or declaration quashing the Show-Cause Notice dated October 14, 2020 issued by the Respondent No.1 /NPPA;

(c) Pass an appropriate writ, order or declaration quashing the Order dated January 13, 2021 passed by the Respondent No.1/NPPA; and

(d) Pass any other or further order(s) which this Hon'ble Court deems fit in the interest of justice."

4. At the outset, learned Senior Counsel appearing for the petitioner invited our attention to the order dated 13th January, 2021 issued by Respondent No.1/NPPA (Annexure P-4 to the Writ Petition) whereby Respondent No.1 has directed the petitioner to furnish CA certified data for sale of the formulation concerning the drug in question. Attention is also drawn to the communication dated 4th February, 2021 (Annexure P-24 to the Writ Petition) whereby the petitioner has, in response to the order dated 13.01.2021, supplied the necessary details to Respondent No.1.

5. It is thus submitted by the learned Senior Counsel for the Petitioner that it would suffice for the disposal of this writ petition if the respondents are directed to decide the show cause notice afresh in accordance with law, and taking into account the various details and the requisite data supplied by the petitioner vide its communication dated 4th February, 2021. It is nevertheless the contention of the Petitioner that the various grounds averred in the present writ petition together with the points urged in the replies given by the petitioner, inter alia, would clearly evidence that the Gazette Notification dated 27.02.2019 issued by invoking para 19 of Drug Price Control Order, 2013 (hereinafter referred to as `DPCO, 2013') is beyond the scope of National Pharmaceuticals Pricing Policy, 2012 as well as para 32 of the DPCO, 2013. It is submitted that OSIMERTINIB is a patented product qualifying for exemption for five years from the date of commencement of its commercial marketing in India. Para 32 (i) of DPCO, 2013 stipulates that the provisions of the said order shall not apply to a manufacturer producing a new drug patented under the Indian Patent Act, 1970 for a period of five years from the date of commencement of its commercial marketing by the manufacturer in the country. These amendments were introduced on 03.01.2019 i.e. prior to the impugned Notification to encourage innovation and research. The Petitioner has a product patent covering the molecule OSIMERTINIB (TAGRISSO) and the same is valid for twenty years i.e. upto 24.07.2032. The Show Cause Notice dated 14.10.2020 and the impugned order dated 13.01.2021 are thus illegal and deserve to be quashed.

6. We have heard learned senior counsel for the Petitioner and learned counsels for the Respondents. We have perused the order dated 13.01.2021 and it is clear that Respondent No.1 has directed the Petitioner to furnish CA certified data before issuing a Demand Notice. Relevant part of the said order reads as under:-

"6. Based on the abovementioned facts, the company has overcharged in sale of Tagrisso 80mg tablet. The company has not submitted details of quantity sold since 08th March, 2019 duly certified by Chartered Accountant as sought vide Show Cause Notice dated 14th October, 2020. Therefore, t