The National Pharmaceutical Pricing Authority (NPPA) has issued notices to Cipla Ltd, Ranbaxy Ltd and Okasa Pharma Ltd., for recovery of over Rs 90 crore as 50 per cent of the overcharged amount with respect to five bulk drugs for the period June 2000 to July 2003.
The notices, issued a few days ago, are subsequent to drug price regulator's earlier notice on the same issue that had wanted the three companies and USV Ltd to deposit more than Rs 132 crore as overcharged amount for the period upto June 2000. The companies have been asked to deposit the amount by December end.
The two notices put together, Cipla Ltd, the most affected company, will have to pay Rs 179.85 crore to the government to avoid legal action. The bulk drugs the company had overcharged are Salbutamol, Ciprofloxacin, Cloxacilin and Norfloxacin.
Ranbaxy, has already paid Rs 23.47 crore, the 50 per cent of the amount the company overcharged on Ciprofloxocin during the period upto 2000. It now needs to pay Rs 2.83 crore as the 50 per cent of the amount overcharged on Norfloxacin and Cloxacilin during the period upto July 2003.
Okasa Ltd has been issued notices seeking recovery of Rs 16.26 crore towards half the amount overcharged on Cloxacillin and Theophylline. In the case of USV Ltd, the recovery notice is for Rs seven lakh towards overcharging Salbutamol for the period upto 2000.
Cipla had during last week informed the Bombay Stock Exchange on the NPPA notice. The company has moved court in two centres and is known to be in no mood to surrender before the authority.
The NPPA action is based on the recent Supreme Court Order (1-8-2003) which states "we also consider it just and proper to give liberty to the appellant and the concerned statutory authorities to recover 50 per cent of the overcharged amounts pending fresh determination by the High Court. Accordingly we direct stay of recovery of 50 per cent of the overcharged amount subject to the payment of remaining 50 per cent within the period of four weeks from the date of communication of the amount payable by each of the writ petitioners."
NPPA has warned the companies to comply by its directive or face legal action.