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Supreme Court Reserves Order as Centre Proposes 3-Member Panel on Pharma Freebies Regulation
The on Tuesday reserved its order on a long-pending plea seeking statutory regulation of unethical marketing practices by pharmaceutical companies, after the Union government informed the bench that it will constitute a three-member committee to examine whether a is required. The bench, comprising Justice Vikram Nath and Justice Sandeep Mehta, heard detailed submissions from , senior advocates representing the petitioners, and other intervenors.
The plea, filed by the , highlights a critical : while doctors are penalised under the (Professional Conduct, Etiquette and Ethics) Regulations, 2002, for accepting gifts, travel, and hospitality from drug companies, there is no corresponding statutory sanction against the companies that offer these inducements. The petitioners argue that this allows pharmaceutical companies to continue offering freebies to influence prescribing behaviour, thereby compromising patient welfare and the integrity of medical practice.
Background of the Case
The matter has been pending since . The petitioners originally sought either the enactment of a binding law regulating pharmaceutical marketing or, in the interim, to strengthen the existing , which was first introduced in 2014 and revised in 2024. The Supreme Court had earlier expressed serious concerns about the enforceability of the UCPMP, noting that without , the code remains largely voluntary and lacks a .
In a previous hearing, the Court had questioned how an ordinary consumer could seek remedy under the when prosecutions are initiated only by drug inspectors. The bench had also pointed out that the UCPMP, 2024, does not provide a direct for patients harmed by unethical marketing.
Centre’s Proposal for a Three-Member Panel
During Tuesday’s hearing, informed the Court that the government had conducted detailed deliberations among the , the , and the . He stated that the Centre has decided to constitute a three-member committee to examine “whether and if yes, what can be the statutory framework to ensure that pharmaceutical companies also do not indulge into such unethical practices.”
Mehta submitted that the committee would be requested to submit its report within two months. Until then, the UCPMP, 2024, would continue to govern the field. He assured the bench that the committee would be formed “in a day or two” as it is the government’s topmost priority.
“However, there is a need of strengthening mechanism to ensure that pharmaceutical companies do not indulge in any unethical practices,” Mehta told the Court. He also noted that large pharmaceutical companies have largely stopped such practices, but smaller players continue to engage in them, and the pharmaceutical industry association itself favours some form of regulation.
Petitioners’ Challenge to the Delay
, appearing for the Federation, questioned the government’s repeated delays. He pointed out that in an affidavit filed in , the Centre had already constituted a high-level committee under the chairmanship of a Member (Health) of to examine the need for a legally enforceable mechanism. That committee was given 90 days to submit recommendations. Parikh also noted that the government had invited bids in for a study on global best practices in pharmaceutical marketing, but the study was never finalised.
“Nearly four years have passed, and now the government is proposing another three-member panel. The UCPMP of 2014 and the present code are substantially the same, barring changes in headings and corrections to some sentences,” Parikh argued.
He highlighted the core in the current regime: doctors who accept freebies face penalties including removal from the medical register for periods ranging from three months to over a year, depending on the value of the benefit. However, the pharmaceutical company that offered the inducement faces no statutory penalty. “This gap in the law allows pharma companies to offer benefits to doctors to influence prescriptions,” he submitted.
Parikh urged the Court to either direct the government to bring a statutory framework or issue its own guidelines to fill the gap until legislation is enacted. He had already submitted suggestions to the Solicitor General on what such a framework should contain.
Other Submissions and Legal Precedents
supported the petitioners’ concerns and stressed the need for an effective regulatory mechanism. She referred to and pointed out an inconsistency concerning the Pradhan Mantri Bhartiya Janaushadhi Pariyojana. She welcomed the government’s proposal but sought an opportunity for stakeholders to participate in the committee’s deliberations. Justice Nath assured that the committee would give stakeholders a chance to place their concerns.
drew the Court’s attention to the Supreme Court’s 2022 judgment in , where the Court recognised that medical practitioners have a with their patients and that benefits offered by pharmaceutical companies can influence prescriptions. The judgment described the practice as a “,” noting instances where companies offered gold coins, electronic goods, and funding for international trips or conferences.
Raj also referred to observations of the regarding generic medicines. He argued that some mechanism is required in the interregnum while the government considers statutory regulation, as the present UCPMP is voluntary.
, appearing for some parties, suggested that the petitioners could give their suggestions directly to the committee so that action could be taken on their grievances.
Legal Analysis and Implications
The core legal issue is whether the current framework—comprising the IMC Regulations for doctors and the UCPMP for companies—is sufficient to curb unethical marketing. The IMC Regulations, though binding on doctors, do not impose any corresponding obligation on pharmaceutical companies. This creates a perverse incentive: companies can freely offer inducements, while doctors bear the entire risk of professional discipline.
The Supreme Court’s earlier observations about the lack of a under the further underscore the gap. The UCPMP, even in its 2024 avatar, lacks and does not provide for penalties or a grievance mechanism for patients. The proposed three-member panel is expected to address these gaps, but petitioners remain sceptical given the government’s history of delays.
The Apex Laboratories judgment provides a strong doctrinal foundation for regulation. By characterising the doctor-patient relationship as quasi-fiduciary, the Court implicitly imposes a duty on doctors to avoid conflicts of interest. Extending that duty to companies that exploit the relationship through inducements is a logical next step.
Impact on Legal Practice and Healthcare
If the committee recommends a statutory framework, it could fundamentally reshape the relationship between pharmaceutical companies and healthcare professionals. Lawyers specialising in healthcare regulation, corporate compliance, and medical ethics will need to advise clients on new obligations. The legislation may include provisions for penalties on companies, mandatory disclosure of payments to doctors, and a mechanism for patients to file complaints.
For the medical community, a balanced regulation could protect honest practitioners from being penalised for accepting benefits while holding companies accountable. However, if the process is further delayed, the Court may step in with , as urged by the petitioners.
Conclusion
The Supreme Court has reserved its order, indicating that it will likely issue directions to facilitate the committee’s work and ensure that the process does not languish. The bench noted that it would pass orders that would “strengthen the hands of the committee.” The next hearing on related matters concerning generic medicines is scheduled for .
The outcome of this case will have far-reaching consequences for pharmaceutical marketing in India. A robust statutory framework could finally end the “” of freebies and restore trust in medical prescriptions. Until then, the legal community will watch closely as the Centre moves to set up the panel and the Supreme Court prepares its order.
