Prohibition on cards for online pharmacies, health ministry sets the ball rolling for regulation

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The Union health ministry is deliberating on steps to regulate e-pharmacies, under which a permanent ban is also being contemplated as an option. This is because some online pharmacies are accused of violating norms of the Drugs and Cosmetics Act, 1940, and breaching data privacy rules, a government source said.

“We are not in favour of e-pharmacies. We believe there are some key concerns emerging from their functioning and it needs to be addressed,” a top official of the ministry said.

The official said the collection of data based on patterns of medicine consumption can be harmful and can be misused by online retailers.

“There is a rampant increase in antibiotic intake which may enhance antimicrobial resistance due to unregulated consumption. There is also a concern of predatory pricing which can impact retail pharmacy,” the source added.

Also read: Tata 1mg, Flipkart, Amazon among 20 e-pharmacies served DGCI notice for violating drug rules

The All Indian Organisation of Chemists and Distributors (AIOCD), an association of retailers, which has been up in arms against e-pharmacies for long, previously wrote to the ministry about the alleged data collection of patients.

“The AIOCD welcomes the Union government’s decision to not allow e-pharmacies in the country. We are for the digitisation of health data but that should be done by the government, no private party should have access to that data,” said Rajiv Singhal, general secretary, AIOCD.

The ministry official said the predatory pricing and concessions offered by online pharmacies posed a risk to the existence of nearly 1.2 million retail sellers.

“If the retailers lose business due to hefty discounts offered by the e-pharmacies, it would leave the interests of the common people in the hands of a few online companies, which would be dangerous,” the official added.

Also read: Govt pharma body calls for banning e-pharmacies, alleges fake prescriptions by ghost doctors

When asked by Moneycontrol about the e-pharmacies getting permission from state regulators to operate, the official said that if a state gives permission, the companies would be allowed to operate in that particular state.

“We will not allow someone having permission from one state delivering medicines online in… other states,” he said

New legislation in pipeline

According to the official source, the government has amended the provisions on operating an e-pharmacy in the draft of the New Drugs, Medical Devices and Cosmetics Bill, 2023.

The draft bill was uploaded on the Union health ministry’s website in July and suggestions, comments and objections from the public and stakeholders were sought within 45 days from the date of issuing of the notice.

The new draft of the bill, seen by Moneycontrol, which has also been sent for inter-ministerial consultation, said, "The central government may regulate, restrict or prohibit the sale or distribution of any drug by online mode, by notification."

Also read: Small retailers, wholesalers are up in arms against pricing, discounts of online pharmacies

The old draft bill said: "No person shall himself or by any other person on his behalf sell, or stock or exhibit or offer for sale, or distribute, any drug by online mode (e-pharmacy) except under and in accordance with a licence or permission issued in such manner as may be prescribed."

The government has removed the provision permitting the licensed operation of e-pharmacies in the bill that has been sent for consultation.

E-pharmacies are yet to respond to queries sent to them by Moneycontrol.

Violations flagged by DCGI

The Drugs Controller General of India (DCGI) in a show-cause notice to 20 e-pharmacies, including prominent names like Tata 1mg, Amazon, Flipkart, NetMeds, MediBuddy, Practo and Apollo, reprimanded them for violating the rules of the Drugs and Cosmetics Act.

The drug watchdog said that these platforms have been retailing drugs not permitted for sale without a proper prescription from registered doctors.

Although there isn’t any specific legislation in India regulating the sale of medicines online, the DCGI notice quotes the Delhi High Court’s order in the matter of Dr Zaheer Ahmed Vs the Union of India. The court had ordered state drug regulators to prohibit the sale of medicines online without a licence, and had asked them to ensure compliance until further orders.