Why E-pharmacy cos are not worried by regulator’s ban on online sales ?

Currently, there are no regulations governing licenses for e-pharmacies. On Wednesday, Mint reported that drugs controller general of India (DCGI) V.G. Somani has directed all states regulators to prohibit sale of medicines through unlicensed online platforms until the government finalises draft rules to regulate e-pharmacies are finalized and put in place.

“Our pharmacy partners are licensed. We are not operating in the shadows. We have been conducting our businesses in compliance with the existing laws of the land," Pradeep Dadha, founder and CEO of Netmeds.com said.

Going ahead, if there are any changes to the law, the industry will adapt and follow the new regulations, Dadha said.

Prashant Tandon, founder and CEO of 1mg, said that there is nothing new in the DCGI letter, and it doesn’t seem to ban e-pharmacies. Instead, a similar letter has been made earlier, and then e-pharmacies have been found to have been operating with licence, he said.

The Central Drugs Standard Control Organisation, though, seems to have a different interpretation of the court order, believing that it says that these companies cannot sell medicines online without a license, a provision which currently does not exist under current norms.

The government has prepared draft e-pharmacy rules, which are currently being reviewed by a Group of Ministers led by defence minister Rajnath Singh.

Pharmeasy co-founder Dharmil Sheth told Mint that “this order does not clearly apply to us" and therefore “it is absolutely irrelevant."

The DCGI’s letter cited a Delhi high court order dated 12 December 2018 in a case filed by dermatologist Dr Zaheer Ahmed. The court had issued an interim order banning “online sale of medicines without licence".

“We are just waiting for the policy to be released which will at least ease the operation for us, and release us from the hassle and harassment that we are facing," Pharmeasy’s Sheth said.

Online pharmacies have always claimed that their business model is well covered by the Information Technology Act under the concept of intermediaries, while their pharmacy retail operations are covered by the Drugs and Cosmetics Act.

E-pharmacy companies have said that if the sector continues to remain in a grey area in terms of regulations, then it could impact around 30,000 skilled professionals it employs, as well as affect the 50 lakh patients that it caters to every month.

“The ball is now actually in the government’s court. For this issue to be resolved, the government has to come out with new rules for the e-pharmacy sector. This sector contributes around 5% of revenue for many pharmaceutical companies," an industry expert covering the pharmaceutical sector said.