Indian pharma company taken to court over freebies to doctors

·3-min read
REUTERS - Amit Dave

Indian authorities are probing allegations that a drug company bribed doctors to promote its anti-fever pills – the latest controversy involving the country’s pharmaceuticals industry.

Accusations that Micro Labs gave freebies to doctors to prescribe its Dolo-650 pills startled the Supreme Court, which on 18 August gave the government 10 days to respond.

"What you are saying is not music to my ears. This is exactly the drug that I had when I had Covid recently,” Justice DY Chandrachud said.

“This is a serious issue and we will look into it," he said while hearing a civil suit filed by India's Federation of Medical and Sales Representatives Associations (FMRAI) complaining of drug firms' use of unethical marketing practices.

The federation said revenue authorities on 14 July accused Dolo-makers of spending 124 million euros on payoffs, after federal tax officials reportedly searched the company's premises.

'Covid snack'

Physicians called Dolo the “magic pill”, or the “Covid pandemic’s favourite snack”, as they prescribed the antiviral during a surge of the Delta variant of the virus last year, when thousands of people were reporting sick every day.

Sales also spiked after India rolled out the world's largest Covid-19 vaccination drive in January 2021 and many clinics recommended Dolo in case of post-jab fever.

The Indian Medical Association (IMA), which has 390,000 physicians on its rolls, said the practice of offering freebies to doctors almost ended in 2018 after Delhi withdrew tax rebates.

“Now in hospitals you will not see even a single [gifted] pen because in the last two, three years the Medical Council of India and income tax authorities have become very stringent,” JA Jayalal, who just ended his term as IMA president, told RFI.

“But in rural India many small companies are coming up, and some may be indulging in such things,” Jayalal said, adding that the IMA had zero tolerance on pay-offs.

“We have a very clear-cut set of rules,” he said, but conceded “black sheep” still lurked in the medical community.

Denying payoffs

Privately run Micro Labs denied the allegations that it was bribing doctors, calling them “preposterous" and adding that it was cooperating with the authorities.

"This is highly misleading and is affecting the reputation of Micro Labs, pharmaceutical industry and doctors," the firm asserted.

A healthcare research agency said Dolo posted sales of 3.6 million euros in December 2021 alone, up 61.4 percent from the same month the previous year.

Bigger picture

In filing its lawsuit, FMRI argued it aimed to clean up India’s pharmaceuticals sector, which is on the path of achieving an annual turnover of 403 billion euros by 2047. This is up from 82 billion euros in the 1970s.

“This current case is certainly not about Dolo alone. We are working to bring in regulations that would stop malpractice in the pharma’ industry,’’ said federation counsel Aparna Bhat.

“This will ensure that patients are directly benefited and no one should die for want of medicines,’’ added federation general secretary Santanu Chatterjee.

“Pharmaceutical companies in India spend enormous amounts of money in sales promotion to influence doctors to generate maximum prescriptions, thereby increasing drug sales,” the Federation argued.

“Though termed as ‘sales promotion', these are direct or indirect advantages offered to doctors,” it added, a month after the court in February stated companies could not demand tax benefits on perks handed to doctors.