Relief for e-pharmacies as Madras HC stays order banning online sale of medicines

E-pharmacies have received a boost as the Madras High Court has stayed an order banning the sale of medicines online, according to multiple media reports.

Vacating a single-judge bench’s earlier order, the two-member bench of M Satyanarayanan and P Rajamanickam said medicines have been sold online for a long time and a sudden shut down of the practice will create “grave hardship, inconvenience and health issue to patients/persons who order medicines through online platforms”.

The bench observed that there are adequate mechanisms in place to prevent any form of abuse of processes by online pharmaceutical companies.

The bench further said the court’s earlier order that the central government should notify rules for selling drugs online by January 31 would continue to stand.

The latest directive came after a group of e-pharmacies and digital health platforms had appealed against the single judge’s order banning the sale of medicines online for an indefinite period until the central government passed necessary rules and regulations that allow for the online sale of medicines.

While The Tamil Nadu Chemists and Druggists Association was the petitioner in the case, online pharmacists like PharmEasy, Netmeds, 1mg and Medlife International were among the 13 respondents.

Venture capital firms have cumulatively invested around $300 million in such companies.

The central government, through the Department of Health and Family Welfare which was the first respondent, took an undertaking to publish rules pertaining to the issue at hand in the next three months.

“We are extremely grateful for the observations made by bench which validates the work that we have put in for the last three years,” said Pradeep Dadha, founder and chief executive of Netmeds.  

“As part of the observations, the bench recognised that mechanisms are in place to prevent any real abuse of process by the online pharma sector. One of the most pertinent observations made was that the central government is not opposed to online pharmacies, and is actively putting in place systems for regulating the sales,” he added.

The Madras High Court bench has posted the final hearing for January 24.

The Madras High Court had earlier passed an order suspending the online sale of medicines till November 9.

The Delhi High Court had also issued a ruling prohibiting e-pharmacies from selling medicines online without a valid licence across the country.

The Delhi High Court’s order is still in force.

At the heart of the problem is the contention by the petitioner that the online sale of medicines is in contravention of the Drugs and Cosmetics Rules, 1945.

Accordingly, sections of the rules stipulate that the online sale of drugs that fall under Schedule H, H1 and Schedule X can be sold only if a valid prescription is issued.

According to the petitioner, e-pharma companies have flouted Rules 65 and 97 of the act by selling prescription drugs and controlled substances without a valid prescription. Additionally, these players also offered bulk discounts to users, with the price difference going up to even 20%.