The Centre says the trade margin on cancer drugs is capped at 30% of MRP; the Supreme Court wants to know why the rest of the pharmaceutical and medical device sector is left out.
Thank you for reading this post, don't forget to subscribe!
New Delhi: On Monday the Supreme Court heard the Union government say that trade margins on anti-cancer drugs are capped at 30 per cent of the maximum retail price (MRP), while also questioning why the cap covers only cancer drugs and not medicines and medical devices more widely [Kishan Chand Jain v. Ethics and Medical Registration Board (erstwhile Medical Council of India) and Others].
Justice Vikram Nath and Justice Sandeep Mehta heard the matter, with Solicitor General Tushar Mehta appearing for the Centre. The next hearing is on October 27.
Questions from the Bench
The Bench asked why margin regulation stops at cancer drugs and why the wider pharmaceutical and medical device sector escapes it upfront. It cited examples of the gap between what retailers pay and the MRP, including a cardiac stent with a price to retailer of Rs 5,000 and an MRP of Rs 25,000, and suggested that a 16 per cent cap on margins would reduce unnecessary interventions.
It also pointed to Azithromycin, with an MRP of Rs 78.29 against a price to stockist of Rs 28.50, and to a saline drip line with an MRP of Rs 11 that is said to be sold to hospitals for Rs 270. On the Centre’s reliance on its affidavit for the 16 per cent margin on drugs under price control, the Court asked for one justification where concern for patients was shown.
ALSO READ: Why Not Cap Medicine MRP At 16% Above Retailer Price? Supreme Court Questions Centre
The Centre’s answer
Mr. Mehta told the Court that the 30 per cent cap applies to anti-cancer drugs and that the Union will publish a periodically updated list of approved cancer medicines covered by it, leaving out only inexpensive formulations. He added that cardiac stents are already capped. The Centre’s position is that the pricing issue for cancer drugs has been addressed.
Additional Solicitor General Aishwarya Bhati argued that pricing policy has to balance availability with market forces and warned that heavy intervention could hurt supply:
“We don’t want to control the entire ecosystem of drugs.”
Senior Advocate Kapil Sibal, appearing for the Indian Pharmaceutical Alliance, said that such mark-ups do not exist across most formulations.
The petition behind the hearing
The petition seeks mandatory generic prescriptions, strict price controls from the outset on non-scheduled medicines, and MRP caps on medical devices. According to the petitioner, the Drugs (Prices Control) Order, 2013 fixes ceiling prices for only about 1,000 scheduled drugs, leaving roughly 82 per cent of medicines non-scheduled and priced by the market.
What remains open
The Centre’s statement is a policy step taken while the matter is before the Court, and it is limited to cancer drugs. The Bench’s questions signal that the larger issue, whether upfront margin controls should reach non-scheduled medicines and medical devices, is still open and will be examined when the matter returns on October 27. No direction on that wider question has been issued so far.
Case Title: Kishan Chand Jain v. Ethics and Medical Registration Board (erstwhile Medical Council of India) and Others (case number not available)
Bench: Justice Vikram Nath and Justice Sandeep Mehta, Supreme Court of India
Date of Hearing: October 12, 2026; next hearing October 27, 2026
Appearances: Solicitor General Tushar Mehta and Additional Solicitor General Aishwarya Bhati for the Union; Senior Advocate Kapil Sibal for the Indian Pharmaceutical Alliance