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NPPA issues guidelines to expedite monitoring & recovery in overcharging cases
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Ramesh Shankar, Mumbai
August 30 , 2016
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In order to rationalise and expedite the monitoring, enforcement and
recovery process in overcharging cases, and make it time bound and more
transparent in implementation, the National Pharmaceutical Pricing
Authority (NPPA) has issued internal guidelines which will be followed
by the NPPA in suppression of all previous internal guidelines in this
regard.
These guidelines will help the NPPA in identification and
initiating action for recovery in cases of overcharging by
manufacturers and/or marketers under DPCO, 2013, DPCO, 1995 and DPCO,
1987.
As per the guidelines, the Monitoring and Examination
(M&E) division will constantly monitor and identify cases of
overpricing from different sources. It will follow a well defined
procedure in identification, examination and shortlisting of prima facie
actionable cases of overpricing and submit such cases to Overcharging
division for further action along with a note explaining the reasons
thereof. M&E division shall categorise all cases under
scheduled/non-scheduled drugs and also specify the provision of DPCO,
2013 which has been violated. The M&E division shall also keep all
the information sent by manufacturers in various Forms in well organised
folders so that it can be retrieved without delay for price comparison
as and when required. Subsequently, the data on IPDMS shall also be
utilised for such purpose.
The M&E division shall first
examine all such cases based on the consolidated price list in Form I,
Form II and Form V furnished by the manufacturers or available on IPDMS
as per Para 15, 16, 24 and 25 of the DPCO, 2013 and verify the fact of
overcharging. The manufacturer and dealers both will be responsible for
overcharging on jointly or severally basis. If the manufacturer has not
already furnished the information in Form 1, Form II and Form V or the
information is not enough to draw a conclusion, the Monitoring division
will send the prescribed time-bound preliminary notice (PN) to the
company and seek requisite information on the prescribed format within
21 days from the date of receipt of the PN or 30 days from the date of
issue of PN.
The DPCOs empower the government to recover from the
manufacturers, the amount accrued due to charging of prices higher than
those fixed or notified by the government under various provisions of
the DPCOs along with interest @15% thereon from the date of
overcharging. Contravention of provisions of the DPCOs is also
punishable in accordance with the provisions of Essential Commodities
Act, 1955.
Accordingly, in case any manufacturer is found to be
not complying with the provisions of DPCOs, action is initiated by the
NPPA for recovery of the overcharged amount along with interest and with
or without penalty as arrears of land revenue in accordance with
Section 7A of Essential Commodities Act.
Under paragraphs 14(2),
15(5) & (6), 16(5) of DPCO, 2013, in case of violation, concerned
manufacturer is liable to deposit the overcharged amount with interest
thereon from date of such overcharging in respect of scheduled
formulation. Under paragraph 20 of the DPCO, 2013 in respect of
non-scheduled formulation, the manufacturer is liable to deposit the
overcharged amount along with interest thereon from date of increase in
price in addition to the penalty. Paragraph 23 of DPCO, 2013 empowers
recovery of overcharged amount under DPCO 1987 and 1995. Paragraph 22 of
DPCO, 2013 deals with recovery of dues under the DPCO, 1979.
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