India orders halt on online drug sales in crackdown on unlicenced players

The government has ordered a halt to online drug sales as it works on rules to regulate the sector, in a setback for companies that have ploughed in millions of dollars to open up a new business arena amid lack of regulation.

In a 28 November order, drugs controller general of India (DCGI) V.G. Somani directed all states and Union territories to prohibit sale of medicines through unlicensed online platforms till draft rules to regulate e-pharmacies are finalized and put in place.

The DCGI’s letter, seen by Mint, cites a Delhi high court order dated 12 December 2018 in a case filed by dermatologist Dr Zaheer Ahmed. The letter was sent by the DCGI to all state drug regulators and the Union health ministry for their information and action.

The Delhi high court order had said drugs were sold online in violation of the Drugs and Cosmetics (D&C) Act. However, e-pharmacies continued to sell online, after securing a stay from the Madras high court.

“Sale of medicines on any online platform should stop according to the order,” said Rajiv Singhal, general secretary of All India Organization of Chemists and Druggists. “Despite previous orders, companies are selling medicines online, which can pose a threat to the health of patients. We are planning to move a case of contempt of court in this regard.”

According to Prashant Tandon, founder and CEO of 1mg, while some online pharmacies comply with the law, there are “miscreants”—mostly outside India and some local players—which do not follow laws and medicines are sold without prescription or licence. “In our model, there is a platform on which the customer uploads the prescription, which is then passed to a physical, licensed store with a qualified pharmacist. This store operates under the purview of the D&C Act and Rules.

“These orders should impact any player, who is selling medicines directly in violation of the Act. A similar order came from CDSCO in December 2017 also, and when we sought clarification, we were told that there is no cause to worry if we operate a model in compliance with the law.”

“We have worked hard to build the online pharmacy sector from something that didn’t exist five years back, into a viable and critical industry that reaches lakhs of people every day providing life-saving, affordable medication,” said Pradeep Dadha, founder and CEO of Netmeds.

This article was first published on livemint.com

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.