Till date, it was the duty of the District Collectors to recover penalties levied on pharma companies for drug overpricing. However, alarmed by the failure of the district collectors to collect substantial penalties from the erring pharma companies, DoP is considering transferring the responsibility to DoP officials.

The Department is looking at the possibility of whether DoP officials can be legally considered as revenue officers and be allowed to recover penalties.

The law prohibits every pharma company from fixing the maximum retail price (MRP) higher than the ceiling price for the drugs that fall under price control. However, DoP has come across 2,079 instances of drug over pricing by pharma companies between 1997 and 2019. The total fine for the period amounts to Rs. 6,406.07 crores. Of this, around Rs. 438.38 crores is from cases referred to collectors. The amount is in the process of recovery. An additional Rs. 4,118.79 crore is stuck in litigation since the concerned pharma companies have declined to pay the penalty and sued National Pharmaceutical Pricing Authority.

According to sources, Prime Minsiter’s Office (PMO) will be holding a meeting on January 3 and 4 to review DoP.