The news that the company producing Paracetamol in the trade name of ‘Dolo’ spent INR 1,000 crores as freebies to the doctors for the promotion of their drug is a matter of concern. It shows the total failure of the Government in regulating pharmaceutical marketing practices. It is well known that Pharma companies spend huge amounts of money on the promotion of their products. Much of this is spent in organising medical conferences in the name of continuing medical education programs. This ultimately adds to the cost of drugs and adds to the out-of-pocket expenditure of the patients. The Government framed the Uniform Code of Pharmaceutical Marketing Practices (UCPMP). A letter from the Ministry of Chemicals and Fertilisers, Department of Pharmaceuticals dated 12 December, 2014 mentioned that this will be voluntary for six months with effect from 1st January, 2015 and will be reviewed thereafter. The voluntary clause did not yield noticeable results.
Admitting this fact, HN Ananth Kumar, the then Union minister for Chemicals and Fertilisers, said in the Rajya Sabha in June, 2016 that the voluntary code introduced in 2015 had not yielded desired results and that the Government would make it mandatory because the pharmaceutical companies did not take any tangible steps to implement the code. “Clauses 6 and 7 of the code prohibit the Pharma companies from giving freebies to medical professionals. But despite several representations from the public health activists and civil society groups, the practice has not stopped,” he added. The Indian Medical Council (Professional Conduct, Etiquette and Ethics) regulation also warns the doctors against such practices to receive financial benefits in any form including for attending educational programs. Taking cognizance of the matter even the Central Board of Direct Taxes (CBDT) in its Circular No. 5/2012 [F. NO. 225/142/2012-ITA.II], Dated 1-8-2012 had said that any such expenditure by the Pharma company will not be considered for tax deductions. After ten years the order has been reconfirmed by the Apex court.
Expressing concern over pharmaceutical companies giving freebies to doctors, which push medicine prices up, the Supreme Court on February 22, 2022, held that they are not entitled to claim tax exemption on the expenditure incurred in giving incentives to medical practitioners to promote their medical products and it would be considered as part of their income. As per the guidelines in the UCPMP the companies have to adopt stipulated procedures laid down by the competent authority for involving doctors in their research projects. These companies then use a doctor’s reference including her/his photograph in their promotional literature. The UCPMP prohibits such work. The statement made by the minister of Chemicals & Fertilisers DV Sadananda Gowda in the Parliament in September 2020 that the Union Government has no plans to make the Uniform Code of Pharmaceutical Marketing Practices (UCPMP) mandatory is very disappointing. He said this in reply to a question by K Muraleedharan, Congress MP from Kerala in the Lok Sabha. The u-turn on making UCPMP mandatory raises suspicion of a lack of will on the part of the Government to keep its commitment and smacks of some unfair deal between the Government and the Pharma companies.
