A legal discontention between the distributor and importer of Coronavirus rapid test kits that are shipped from China has surfaced massive profiteering and over-pricing in kits sold to the Indian Council of Medical Research (ICMR). Observing that 61 percent mark-up on such test kits is on the "higher side" but "more than sufficient", the Delhi court single bench of Justice Najmi Waziri disallowed a 145 pc mark-up from the landed price of Rs 245 to ICMR's price of Rs 600 per test. Instead, Justice Waziri slashed the price for each kit by 33 percent from Rs 600 to Rs 400 per test.
The order was against a petition by Rare Metabolics, the only distributor of rapid antibody test kits imported by Matrix Labs, the respondent within the case, from China's Wondfo Biotech.
The dispute was over the release of the remaining 2.24 lakh kits--of the 5 lakh imported from China--to be sent to ICMR. Importer Matrix Labs had argued that it had only been paid Rs 12.25 crore of the Rs 20 crore (plus GST) or Rs 21 crore import. As per the agreement, the balance amount of Rs. 8.25 crores had to be first paid to the importer before any money received from ICMR.
Rare Metabolics filed a petition before the Delhi supreme court seeking the release of the remaining 2.24 lakh test kits in order that they will be supplied to ICMR as per the agreement. The petitioner argued that under its bi-partite agreement with Matrix Labs, no other company can market them in India. the corporate also said that it's already paid Rs 12.75 crore, which covers the freight cost for five lakh test kits. Rare Metabolics assured that payment thanks to Matrix Labs are going to be remitted as soon because it is received.

The dispute arose after Matrix Labs demanded upfront payment, whereas the petitioner maintained that the payment could only be made after ICMR released the funds. The petitioner informed the court that the consignment of two .76 lakh rapid antibody tests has already been supplied to ICMR that payment remains awaited.
This payment is going to be made after the tests meet ICMR's standards. ICMR has put the rapid tests on hold after detecting faulty results from the Wondo kits. The Chinese firm has denied that they were faulty kits.
Matrix Labs countered that the agreement supported the understanding that the payment is going to be upfront, especially with regards to the consignment supplied to ICMR. Rare Metabolics stated that "communication was under duress and contrary to the understanding between the parties".
The respondent also informed that court that it's received an order for 50,000 antibody test kits from the Tamil Nadu government through dealer Shan Biotech and Diagnostics, of which 24,000 kits have already been supplied.