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TOP 5 HEALTH LAWS & POLICY UPDATES

Dear Reader, We are happy to share the most interesting legal and policy updates concerning health industry that we read today. We hope you enjoy reading it.

Central Drug Regulator to have open-door meetings with Industry twice a week
In a first, perhaps anywhere in the world, India’s top officer in the Drug Regulator’s office, the Drugs Controller General of India (DCGI), has announced that there will be walk-in meetings for the industry every Tuesday and Thursday between 5 and 6 pm, where industry can present its problems and suggestions directly before the officer. The move is aimed at improving Ease of Doing Business in India.
Source: bit.ly/48k9MmX

Waiting for Drug Price Regulator to fix retail prices of new drugs before they can be launched will adversely impact industry
An association of pharmaceutical manufacturers has reportedly submitted an appeal before the Drug Price Regulator, National Pharmaceutical Pricing Authority (NPPA), to recall its notice which directs drug manufacturers to delay launch of new drug until the retail prices of those products have been fixed and notified by NPPA. The association has submitted that notice will negatively impact drug manufacturers’ businesses and cause significant losses.
Source: bit.ly/48cUJvf

Regulatory Data Exclusivity on negotiation table between India and Europe during FTA talks
As per media reports, European Free Trade Association has demanded regulatory data exclusivity for drugs during the discussion on proposed Trade and Economic Partnership Agreement. If India accepts the demand, then Indian domestic drug manufacturers will not be able to rely on clinical trial data of innovator drug manufacturer for obtaining regulatory approvals in India, thereby impacting cost and timelines for generic drugs entry in Indian market.
Source: bit.ly/3T01NHe

Insurance Regulator has proposed to increase free-look time for insurance policies from 15 days to 1 month
As part of the recently published draft IRDAI (Protection of Policyholders’ Interests and Allied Matters of Insurers) Regulations, 2024, the Insurance Regulator (IRDAI) has proposed to increase the free-look time for insurance policies from 15 days to 1 month. The free-look time is the time by which a policy holder of an insurance policy can cancel an insurance policy after purchasing it without liability to him.
Source: bit.ly/3T1PcDr

New York City has sued major social media companies for affecting mental health of youth and children
The New York City Mayor has announced that his administration has sued major social media companies on ground that they have intentionally designed platforms to purposefully manipulate and addict children and teens to social media applications.
Source: bit.ly/3OLyZPY

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TOP 5 HEALTH LAWS & POLICY UPDATES

Dear Reader, We are happy to share the most interesting legal and policy updates concerning health industry that we read today. We hope you enjoy reading it.

New Departmental Guidelines for sampling of Spurious Drugs, Medical Devices and Cosmetics Published
India’s apex regulatory body for drugs, medical devices and cosmetics, the Central Drugs Standards Control Organization, has published revised sampling guidelines for inspectors to follow in various states. All inspectors are required to collect at least 9 samples of drugs, and 1 sample of cosmetic or medical device in each month. The inspectors are supposed to be alert about feedback received from citizens and doctors in deciding which drugs, cosmetics and medical device brands they ought to sample and test for compliance with laws.
Source: bit.ly/3SDnLym

Social Media companies asked by High Court to handover details of persons who fraudulently operated certain accounts and channels
The Delhi High Court has ordered major social media companies including Facebook and Telegram to disclose identities of users accused of misusing trademark of major venture capital firm to cheat users by soliciting bogus investments. The court has also ordered concerned social media companies to provide details on action they will take to prevent further violation.
Source: bit.ly/3HXkxAP

WhatsApp and emails may be used to send legal notices for demanding unpaid amounts: High Court
The Allahabad High Court has reiterated that notice in cheque bounce case sent by WhatsApp or e-mail will be considered valid notice for the purposes of recovery under The Negotiable Instruments Act, 1881, and it will be presumed to have been dispatched and served on the same day.
Source: bit.ly/48f8Xf6

Popular Party Drugs added to list of Psychotropic Substances
The Indian Government has added popular synthetic party drugs, ADB-BUTINACA, Alpha-PiHP and 3 Methylmethcathinone (3-MMC), to list of psychotropic substances and notified small and commercial quantity of these substances for the purpose of fixing quantum of punishment for unlawful possession. Possessing psychotropic substances without permission or prescription is an offence under Narcotic Drugs and Psychotropic Substances Act, 1985.
Source: bit.ly/48ghuhM

WHO recommends antibiotics which should be exclusively put to human use to reduce chance of antimicrobial resistance
The World Health Organization (WHO) has updated its Medically Important Antimicrobials for Human Use (WHO MIA List), and reclassified antimicrobial drugs on basis of potential impact on human heath to limit the use of identified antimicrobials in other populations such as in plants and animals. The WHO hopes that reducing use of critical antimicrobial drugs in other population will reduce pace of antimicrobial resistance.
Source: bit.ly/49eVll9

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TOP 5 HEALTH LAWS & POLICY UPDATES

Dear Reader, We are happy to share the most interesting legal and policy updates concerning health industry that we read today. We hope you enjoy reading it.

Human Rights body to probe sale of drugs with identical brand names in India
The National Human Rights Commission (NHRC) in India has taken suo motu cognizance of a newspaper report which stated that many drugs in India were being sold with identical brand names for treating different medical conditions. NHRC has issued notice to Secretary, Ministry of Health and Family Welfare and Central Drugs Regulator, asking for detailed report within four (04) weeks.
Source: bit.ly/3SB8WfB

India’s Environment Regulator to take action against unregistered recyclers and refurbisher of battery waste
India’s Central Pollution Control Board (CPCB) has issued direction to all State Pollution Control Board (SPCB) and Pollution Control Committees (PCCs) to ensure compliance with Battery Waste Management Rules, 2022 by recyclers and refurbishers of battery waste. CPCB has directed SPCB/PCC to carry out drives identifying informal / illegal battery waste recyclers, and physically verify facilities of existing waste recyclers. All battery waste recyclers and refurbishers are obligated to register under Battery Waste Management Rules, 2022.
Source: bit.ly/3OGJTGI

Difference of manufacturing process will not take away ability of manufacturer of product manufacturer to enforce product patent, if the product is covered by Product-by-Process Patent: High Court
The Delhi High Court of India has held that a product-by-process patent would be enforceable even if the alleged infringement relates to manufacturing of a product using process which is different than the one claimed in patent. The High Court was dealing with a matter relating to manufacture of a compound called Ferric Carboxymaltose (FCM) which was patented by the Innovator. The defendants had raised an argument that they are not covered by the patent because they were following a different process to manufacture FCM. However, the argument was rejected by the High Court.
Source: bit.ly/3OGtr9C

Manufacturers of medical devices who do not wish to disclose name and address of manufacturing facility, may apply for neutral code on central portal
The Indian medical devices regulator, Central Drugs Standard Control Organization (CDSCO) has direct all the manufacturers of medical devices for export purposes to submit the applications for neutral code through online system of medical devices portal only. If a neutral code is declared on the label of package, it does not have to bear the name and address of the manufacturer. The online portal is now functional to accept the applications.
Source: bit.ly/3SWgTxn

Recommendations for COVID legislation received from Law Commission of India
The Law Commission of India has submitted its report titled “A Comprehensive Review of the Epidemic Diseases Act, 1897″ to the Government of India. The commission has recommended either to amend the existing law or enact the new legislation to address the underlying gaps in the Epidemic Diseases Act, 1897. The 1897 was relied on by the Government of India to introduce various controls during the COVID pandemic, including lock downs.
Source: bit.ly/3SWMdMm

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Top 5 Health Laws & Policy Updates

Dear Reader, We are happy to share the most interesting legal and policy updates concerning health industry that we read today. We hope you enjoy reading it.

Innovator Pharma Company questions biosimilar trial on ground of non-procurement of comparator drug from authorized sources
A multinational pharmaceutical company has questioned the veracity of a biosimilar drug trial before India’s clinical trial regulator, The Drugs Controller General of India (DCGI), on grounds that the comparator drug, a biologic, was not procured from authorized sources, thereby putting clinical trial subjects at risk and casting shadow over appropriateness of the clinical trial.
Source: bit.ly/49tJmjj

Indian IPR regime well-equipped to handle AI generated works and there is no proposal to amend the law in context of AI generated content: Ministry of Commerce & Industry
India’s Minister of Commerce & Industry, while replying to a question in India’s parliament, has clarified that user of Generative AI should obtain permissions of owner of original copyrighted work processed by Generative AI technology before using the AI generated content for commercial purposes. The Minister further clarified that there is neither any proposal to create any separate right nor to amend the law in the context of AI-generated content.
Source: bit.ly/48cK4R8

Guidelines to distinguish nutraceuticals and drugs which have same or similar composition soon
The Indian Government has reportedly formed a high-level committee to address complaints that products which have identical or similar compositions are being approved as nutraceuticals, drugs or ayurvedic formulations, depending on the regulatory pathway chosen by the manufacturer. Under the current law, nutraceuticals are not permitted to make claims of treatment or cure on the label, however there are reports of non-compliance with this requirement.
Source: bit.ly/49bvaMb

Preparing a list of unvaccinated employees does not amount to violation of privacy: Madras High Court
India’s Madras High Court has held that the action of preparation of list of employees who have not received COVID-19 vaccinations and subsequent circulation of such list amongst employees of company would not amount to violation of privacy. The High Court was hearing a criminal complaint filed by an employee of the Company under Information Technology Act, 2000 on grounds that the Company had breached the said law sharing his personal information as part of list of unvaccinated employees.
Source: bit.ly/42yExmP

Couples seeking surrogacy on medical grounds are able to use donor sperm or egg, in spite of law to the contrary, by approaching a High Court
Following the precedent set by Supreme Court, the Bombay High Court has permitted two couples to use donor eggs for surrogacy owing to medical issues faced by the Couple. The development is important because The Surrogacy (Regulation) Rules, 2022 explicitly prohibits the use of donor gametes for surrogacy. In the past, Karnataka High Court has also granted similar reliefs to a couple facing medical challenges to conceive using own gametes while seeking a surrogate to deliver the baby.
Source: bit.ly/42yczHP

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Daily Health News Wrap – 01 Feb 2024

01 Feb 2024

Important clarifications issued by Central Pollution Control Board w.r.t. Extended Producer Responsibility (EPR) compliances under E-waste Management Rules, 2022.
India’s Central Pollution Control Board (CPCB) has released certain notices and guidance document under E-Waste (Management) Rules, 2022 which have a significant impact on EPR obligations.
Sources: –
FAQ for E-waste: bit.ly/3HHuiCU
Fee Structure for registration for Recyclers: bit.ly/3SpMBkS
Notice for Producers:  bit.ly/48XXFwK
Notice for Recyclers: bit.ly/48XhbJK
Important clarification issued by India’s Central Pollution Control Board (CPCB) under E-waste Management Rules, 2022 (EWM) for the importers of Electrical and Electronic Equipment (EEE) who are not required to comply with Extended Producer Responsibility (EPR) requirements
India’s Central Pollution Control Board has issued a clarification under E-waste Management Rules, 2022 (EWM Rules) identifying importers of Electrical and Electronic Equipment (EEE) who are not required to be registered as Producers under EWM Rules and therefore do not need to fulfil Extended Producer Responsibility (EPR) obligations. Such producers are required to submit certain documents to Customs/Port authorities as a proof of submission of those documents to CPCB.
Source: bit.ly/42kj9Bq
Indian Government extends the deadline for application of quality control order for certain drugs
Indian Central Government has extended the dates of applicability of Quality Control Orders (QCO) of Morpholine, Acetic Acid, Methanol and Aniline to 1st August 2024, 3rd August 2024, 3rd August 2024 and 3rd August 2024 respectively.
Source: bit.ly/48XokK3
Indian Government extends timelines for submission of application under Production Linked Incentive (PLI) scheme
The Department of Pharmaceutical under the Indian Ministry of Chemicals and Fertilizers has extended the timeline for medical device manufacturing companies to submit the application under the Production Linked Incentive (PLI) Scheme till the end of February 2024. The PLI scheme aims to promote domestic manufacturing of class B medical devices.
Source: bit.ly/47Y4UDx
New Guidelines for effective performance of Environment Regulators issued by Supreme Court of India
The Supreme Court of India has recently issued stringent guidelines which ensure the efficient functioning of environmental protection authorities and the enforcement of environmental regulations across the country. The court also upheld the reconstitution of the Central Empowered Committee (CEC), which is tasked with compliance with judicial orders pertaining to environmental conservation.
Source: bit.ly/3SFwscs
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Rounding-off Principles for Drugs and Medical Devices under Drugs (Prices Control) Order, 2013

In this article, we have discussed rounding-off principles that manufacturers and importers of drugs and medical devices should follow while determining the maximum retail price (MRP) of their products.


What is rounding-off?
Rounding-off refers to adjusting a fractional price of a drug or medical device to the nearest rupee, or the nearest paisa, depending on the context.


Why is rounding-off relevant for drugs and medical devices?
The MRP of drugs and medical devices is regulated by a law called the Drugs (Prices Control) Order, 2013 (“DPCO”). If a manufacturer or importer decides to round-off the MRP of a drug or medical device for any reason, for example, pursuant to an increase or decrease in applicable taxes, and the rounding-off is not acceptable as per provisions of DPCO, then it may result in recovery of the overcharged amount from the manufacturer or importer.


What are the principles of rounding-off prescribed under DPCO?
The DPCO itself is, as such, silent on the rounding-off of MRP. However, the authority responsible for enforcement of the DPCO, the National Pharmaceutical Pricing Authority (NPPA), has recognized the fact that rounding-off of MRP is an acceptable market practice [NPPA Minutes, 2016]. It is acceptable to NPPA that rounding-off of MRP is done as per ‘general mathematical practice’.


What is the general mathematical practice of rounding-off?
The general mathematical practice is to round-off the second decimal place of the MRP, depending on the number present at the third decimal. If the number present at the third decimal place is 5 or bigger than 5, then the number present at the second decimal place may be increased by 1. If the number present at the third decimal is less than 5, then the number present at the second decimal place will not change.
Some illustrations:

S No.Actual FigureRounded-off Figure
1.Rs. 123.45/-Rs. 123.45/-
2.Rs. 123.455/-Rs. 123.46/-
3.Rs. 123.456/-Rs. 123.46/-
4.Rs. 123.991/-Rs. 123.99/-
5.Rs. 123.999/-Rs. 124.00/-
6.Rs. 123.001/-Rs. 123.00/-
7.Rs. 123.111/-Rs. 123.11/-


The above understanding was validated by the Delhi High Court in the case of Union of India v Bharat Serums.


Whether rounding-off is permitted for medical devices under Legal Metrology (Packaged Commodities) Rules, 2011?
The MRP of medical devices is regulated by DPCO as well as Legal Metrology (Packaged Commodities) Rules, 2011 (“LMPC Rules”). Until 23.6.2017, the LMPC Rules had a provision to round off the fractional MRP to the nearest rupee. In other words, medical devices were permitted to round-off the fraction of less than fifty paise to the preceding rupees and a fraction of above 50 paise and up to 95 paise to the rounded off to fifty paise.
However, the above provision was omitted from LMPC Rules with effect from 1.1.2018. Therefore, the MRP of medical devices today cannot be rounded off, except in the case of the second decimal place, as described earlier.


Can a manufacturer or importer of medical devices round-off MRP of medical devices to the nearest rupee or 50 paise?
The simple answer is no, especially not after 2018. Before this, it was at least arguable that manufacturers and importers of medical devices could rely on the provisions of LMPC to take a position that they had the flexibility to round-off the MRP to the nearest rupee or 50 paise. The price regulator, NPPA, however, has not accepted this position. Post 2018, there is no basis for manufacturers and importers of medical devices to take such a position since the supporting LMPC provisions are now omitted.
Please note that manufacturers and importers of drugs could never take benefit of the flexibility of rounding-off under LMPC Rules for fixing MRP because LMPC Rules do not apply to drugs.


Conclusion
The flexibility to round-off MRP in the case of drugs and medical devices is available up to the second decimal place only, as per general mathematical practice. Any error in rounding-off for drugs and medical devices can result in significant recovery from manufacturers and importers under the provisions of the Drugs (Prices Control) Order, 2013.

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PERMISSIBLE PRICE INCREASE AND CALCULATION OF OVERCHARGED AMOUNT UNDER DRUG PRICES CONTROL ORDER (DPCO)

DRUGS AND MEDICAL DEVICES PRICE INCREASE RESTRICTIONS

The Division Bench of the High Court of Delhi, in the case of Union of India v Bharat Serums, has laid down how the overcharged amount should be calculated by India’s drug price control regulator, National Pharmaceutical Pricing Authority (“NPPA”). The judgement will have a significant impact on existing as well as future demands for overcharging which are raised on pharmaceutical and medical device companies in India.

Background

Under Para 20 of India’s drug price control law, the Drug (Prices Control) Order, 2013 [“DPCO”], all non-scheduled formulations are allowed to increase their price by 10% in 12 months. Non-scheduled formulations are non-essential drugs or medical devices that are not listed in the schedule of DPCO. Most pharmaceutical and medical device companies do not use the 10% price increase opportunity in the 12-month period and elect to increase the price after a number of years.

When the opportunity does arise to increase prices, the question that always arises is whether the company can increase the price by the ‘aggregate’ of permitted percentage increase, or by a maximum of 10% from its last published Maximum Retail Price (MRP). For instance, if the MRP of a drug or medical device was Rs. 100, and the company selling the product decides to increase the price of the drug or medical device after a period of 5 years, would it be entitled to increase the price of the product by Rs. 50 (10% increase allowed every 12 months period), or by Rs. 10 (10% increase from last MRP irrespective of the time gap).

The other question that arises is if a pharmaceutical or medical device company increases the MRP of its product by more than 10% in a 12-month period, then how should NPPA recover the overcharged amount? For instance, if the MRP of a drug or medical device was Rs. 100 earlier, and if the company revises the MRP of the product to Rs. 200 after 5 years, how should NPPA calculate the overcharged amount? Should NPPA assume that the company was only allowed to increase MRP by 10% and recover the remainder amount as an overcharged amount? In other words, should NPPA give a concession of Rs. 10 to the company and proceed to recover Rs. 90, or should NPPA ‘assume’ that the company would have increased its price by 10% each year, and proceed to recover only the balance amount, in this case Rs. 50 (or more accurately Rs. 39 since a 10% increase every year for 5 years would have resulted in MRP of Rs. 161).

The above questions were conclusively answered by the Delhi High Court and are discussed below.

Interpretation of 10% permissible price increase in 12-month period

The Delhi High Court has interpreted the 10% allowance to increase MRP as follows: the MRP of non-scheduled formulations can only be increased by 10% in a period of 12 months, at a time, but in case of overcharging, the NPPA will have to assume that the company would have taken the 10% MRP increase and will be permitted to recover the ‘net’ amount.

The above interpretation is explained using examples in the paragraphs below.

Examples

What is permissible MRP increase for a pharmaceutical or medical device company?

If the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, the permissible price increase on yearly basis would be as follows:

Years01.01.201401.01.201501.01.201601.01.201701.01.201801.01.201901.01.2020
  Actual MRP100110121133.1146.41161.05177.15

If a pharmaceutical or medical device company wishes to take 10% increase after 5 years, how much can that be?

If the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, and the company decided to take a price increase in 2019, the maximum permissible price increase would be Rs. 110.

Years01.01.201401.01.201501.01.201601.01.201701.01.201801.01.201901.01.2020
  Actual MRP100100100100100110121

How should the overcharged amount be calculated, in the event of default by a pharmaceutical or medical device company?

In a hypothetical scenario, where the MRP of a non-scheduled drug or medical device was Rs. 100 in 2014, and the company decided to increase it to Rs. 161.05 in 2015 and later to 177.15 in 2020, the overcharged amount will have to be calculated as follows:

Years01.01.201401.01.201501.01.201601.01.201701.01.201801.01.201901.01.2020Total ovecharged amount
  Actual MRP100/-161.05161.05161.05161.05161.05177.15–
Permissible MRP (with 10% increase)Not applicable110121133.1146.41161.05177.15–
How NPPA calculated overcharging amount ? (Not legal)Not applicable51.0551.0551.0551.0500204.2
Overcharged amount as per Delhi High CourtNot applicable51.0540.0527.9514.6400133.69

The above table is instructive because it illustrates the incorrect methodology applied by NPPA to calculate the overcharged amount that has been routinely demanded and recovered by NPPA so far from pharmaceutical and medical device companies.

Until the Delhi High Court judgement, the NPPA demanded an amount which was excessive and incorrectly calculated (Rs. 204.2). However, after the Delhi High Court judgement, irrespective of the amount that has been calculated by the NPPA, the actual payable amount will be significantly lower than the amount demanded by NPPA (Rs. 133.69).

Impact

This particular Delhi High Court judgement on permissible price increase of drugs and medical devices will have a far-reaching impact on existing overcharging demands which have been raised by NPPA, and the demands that NPPA will raise in the future. All existing demands for overcharging raised by NPPA, which have been calculated using incorrect methodology due to incorrect interpretation of overcharging provisions of DPCO by NPPA, should be rolled back by the NPPA. A pharmaceutical or medical device company that has currently received such a demand should strongly object to the NPPA’s demand on the strength of the Delhi High Court judgement.

Pharmaceutical and medical device companies should also be careful in taking price increases for non-scheduled formulations in the future, and should not assume that they will be able to take an ‘aggregate’ price increase after a certain number of years if they haven’t availed the option to increase the price every 12 months.

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Frequently Asked Questions on the New Menu Labelling Requirement for Food Service Establishments in India

FAQs on Food menu labelling

The packaging and labelling of food items served in a food service establishment in India is regulated by The Food Safety and Standards (Packaging and Labelling) Regulations, 2011 (“Regulations”). The Regulations were amended in August 2020 to introduce the concept of menu labelling for the first time in India. Menu labelling means the process of declaring the nutritional information, calorific value per serving, information about allergens, and the logo exhibition for vegetarian or non-vegetarian, as applicable, on the menu cards/boards/booklets of restaurants and hotels. The menu labelling directives have been in force since January 01, 2022. However, the food regulator had relaxed its stringent implementation till June 30, 2022 in order to grant some additional time to the food business operators to adopt to the menu labelling mandates. In order to ensure compliance to the Regulations, the food regulator will commence verification of the declarations by sampling food items listed on the menu cards/boards/booklets of the food business operators from July 01, 2022 onwards. Since, the date is approaching, we have put together a list of frequently asked questions (FAQs) with our responses in this article to facilitate the food business operators to adopt the practice of menu labelling in a self-compliant manner.

Please note that these FAQs are based on our understanding of the law, and under no circumstances should they be regarded as legal or professional advice or an endorsement of any industry practice.

Q. What is the new menu labelling requirement?

A. Owing to an amendment to The Food Safety and Standards (Packaging and Labelling) Regulations, 2011 in August 2020, a new sub-regulation (2.4.6.), i.e., ‘Display of information in food service establishments’ was inserted to the existing regulation 2.4 enlisting specific requirements/restrictions on the manner of labelling. This sub-regulation mandates declaration of calorie information of food items amongst other specific labelling proclamations. This sub-regulation has introduced India to the concept of menu labelling in line with the emerging global trend towards reshaping the conventional food systems.

Q. Who does the menu labelling requirement apply to?

A. The menu labelling requirement is applicable to food service establishments either having central license or outlets at 10 or more locations. However, food service premises operating for a period of less than sixty days in a calendar year (consecutively or non-consecutively) are exempt from the menu labelling mandate irrespective of whether they possess a central license or have outlets at 10 or more locations.

Q. Which restaurants are covered by the menu labelling requirement?

A. Restaurants having a turnover of more than Rs. 20 Crores per annum or outlets at 10 or more locations have to ensure compliance with the menu labelling requirement.

Q. Do caterers also have to comply with the menu labelling requirement?

A. Yes. Caterers having a turnover of more than Rs. 20 Crores per annum or outlets at 10 or more locations have to comply with the menu labelling requirement. However, event caterers operating for a period of less than sixty days in a calendar year (consecutively or non-consecutively) are exempt from the labelling requirement.

Q. Do departmental canteens at the premises of central government institutions also have to declare information on their menu?

A. Yes. Departmental canteens at the premises of central government institutions having a turnover of more than Rs. 12 Lacs per annum are mandated to comply with the menu labelling requirement.

Q. Do food service establishments involved in preparation and serving of food at airports/seaports also have to comply with the menu labelling requirement?

A. Yes. Food service establishments involved in preparation and serving of food at airports/seaports have to comply with the menu labelling requirement.

Q. Do Restaurants/Caterers/Canteens at the premises of Railway Stations also have to comply with the menu labelling requirement?

A. Yes. Restaurants/Caterers/Canteens at the premises of Railway Stations serving food items through a menu card/board/booklet and having a turnover of more than Rs. 12 Lacs per annum have to comply with the menu labelling requirement.

Q. Are the food delivery platforms also required to comply with the menu labelling requirement?

A. Yes. The menu labelling requirement is applicable to all e-commerce food business operators to the extent it is applicable to physical food establishments, i.e., e-commerce food business operators have to display the mandated declarations on their website/platform only for food items from those establishments which have a central license or outlets at 10 or more locations. The e-commerce food business operator can either get this information directly from the respective food business operators and update it on their online platforms or implement a feature on their web and/mobile applications that allows such restaurant chains to upload and exhibit the same information for every food that is offered for sale by the restaurant on the platform of the e-commerce food business operator.

Q. Is the menu labelling requirement also applicable to food items not listed on the menu of the food service establishment?

A. No. The menu labelling mandate is not applicable to special-order items or modified meals not listed on the menu of the food service establishments. The menu labelling mandate is also not applicable to self-serve condiments that are free of charge and not listed on the menu. In addition, the menu items prepared as per the request of the customer will also not attract a menu label irrespective of the mode and manner of sale.

Q. What declarations have to be mentioned against the food items on the menu card as per the menu labelling requirement?

A. The following information has to be declared against the food items displayed on the menu cards/boards/booklets of the food service establishments in a manner compliant to the provisions of the Regulations:

  • Calorific value (in kcal per serving and serving size) including the reference information on calorie requirements to be specified verbatim as “an average active adult requires 2,000 kcal energy per day, however, calorie needs may vary”
  • Information relating to allergens
  • Logo for vegetarian or non-vegetarian
  • Nutritional information
  • Information relating to organic food or ingredients, if claimed
  • Specific labelling requirements mandated under the Regulations relating to food products containing added monosodium glutamate, artificial sweeteners, caffeine, polyols, polydextrose, and plant stanol esters

Q. How can a food business operator determine the nutritive value of the food items displayed on their menu?

A. The calorie and nutrition information for food items can be determined by the food service establishments either by a laboratory testing and a nutrient analysis method or by manual calculation using the nutritive/calorific values of each of the ingredients provided by a credible scientifically-backed source. In the latter case, the food business operator will be required to retain physical or soft copy documentation/records of all such sources relied by him for determining the nutritive value of food items for the purposes of verification by the food safety officers, as and when required. On the other hand, the laboratory testing and nutrient analysis method is usually adopted by restaurant chains preparing standardized food items with standardized ingredients and recipes across their outlets.

Q. What if the nutritive value determined by a food business operator is not entirely accurate?

A. A deviation of up to twenty-five per cent is allowed by the regulator.

Q. What is the objective behind mandating the menu labelling requirement?

A. The objective behind introduction of the menu labelling mandate is to enable the consumers to make informed choices about their food purchases and promote public health.

Q. Is there any penalty for non-compliance with the menu labelling requirement?

A. Yes. Any non-compliance with the menu labelling requirement may initially attract an improvement notice from the designated officer under Section 32 of The Food Safety and Standards Act, 2006 directing compliance. If the food business operator fails to comply with an improvement notice, his licence may be suspended and even cancelled if the non-compliance with the improvement notice continues.

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All fertility and surrogacy clinics in India now required to obtain registration under new law

Starting April 22, 2022, all fertility clinics, gamete banks and surrogacy clinics across India will have to commence the process of applying for registration with the National ART and Surrogacy Registry.

The Assisted Reproductive Technology (Regulation) Act, 2021 and the Surrogacy (Regulation) Act, 2021 (which, for the sake of convenience, will be collectively referred to as “the new laws”) came into force on January 25, 2022, to regulate the fertility and surrogacy industry in India.

A National ART and Surrogacy Registry has been constituted and operationalised under the new laws, which will serve as a central database of all clinics and banks in the country. All clinics are mandatorily required to make an application for registration on the Registry website and submit it to the relevant appropriate authority for the state by June 21, 2022. It should be noted that as of today, the appropriate authority for each state has not been notified, but it is expected to be notified within the next few days.

At present, the application for registration involves declaration qualified staff, equipment and nature of procedure undertaken.

In future, clinics and banks may have to demonstrate that they meet the minimum standards of physical infrastructure, facilities, laboratory and diagnostic equipment, and specialised manpower for clinics and banks, that may be prescribed by The National Reproductive Technology and Surrogacy Board (“Board”). If clinics and banks fail to do so, the application for registration may be rejected. As on date, the Board has not yet been set up, so the minimum standards are yet to be prescribed.

Therefore, it may be pragmatic for fertility clinics, gamete banks and surrogacy clinics to make application for registration on the Registry website without delay to avoid any interruption in business and operations in future.

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Pricing Information of Medical Devices Marketed in India to be Submitted to National Pharmaceutical Pricing Authority (NPPA) by March 10, 2021

India’s medical device price regulator has issued a direction to importers and manufacturers of 24 categories of medical device to submit price-related information, including the price at which they sell medical devices to distributors and hospitals in India, by March 10, 2021.

Background

In India, medical devices are regulated not just for quality, but also for price. The Drug (Price Control) Order 2013 (“DPCO”) regulates prices of all medical devices that are marketed in India. Some medical devices such as coronary stents, drug eluting stents, condoms and intra-uterine devices that are listed in the schedule of DPCO have their ceiling price fixed by the National Pharmaceutical Pricing Authority (“NPPA”), while all other medical devices (i.e. the non-scheduled medical devices) have to abide by a restriction whereby their maximum retail price cannot increase by more than 10 per cent in any given 12-month period.

Direction

In order to ensure that medical device manufacturers and importers are complying with the requirements of DPCO, the NPPA has been given powers under DPCO to issue directions to manufacturers and importers to submit price related information. It is in furtherance of this power that NPPA has directed that the following information be submitted to it:

  • Medical device category as per risk classification published by DCGI
  • Product name or specifications
  • Brand name or description
  • Date of launch in India
  • Minimal unit of sale/retail pack size
  • Price per unit to distributor / stockist
  • Price per unit to hospital
  • Price per unit to retailer
  • Applicable GST percentage
  • Moving Annual Turnover
  • Maximum retail price for unit as on January 1 of the years 2018, 2019, 2020 and 2021 (for a few categories, only the MRP as on January 1, 2021 needs to be submitted)

A copy of the said direction is available at this link.

24 Categories of Medical Devices covered by the Direction

Disposable Hypodermic SyringesDisposable Hypodermic NeedlesDisposable Perfusion SetsIVD devices of HIV, HBsAg and HCV
CathetersIntra Ocular LensesI.V. Cannulae       Bone Cements     
Heart ValvesScalp Vein SetOrthopedic ImplantsInternal Prosthetic Replacements      
Ablation DevicesOrgan Preservative SolutionBlood Grouping SeraLigatures, Sutures and Staplers
Tubal RingsSurgical DressingsUmbilical tapes     Blood/Blood Component Bags
NebulizerBlood Pressure Monitoring DeviceDigital ThermometerGlucometer

Challenges with submitting price for retailer

There may be certain fields for which information has been requested by NPPA, but the information may not be available with the importers or manufacturers. For example, the details of price to retailer sought by NPPA may not be available since importers and manufactures typically sell to a distributor or hospital, and not directly to a retailer. In such cases where the information is not available due to the nature of the manufacturer’s or importer’s business model, the importer or manufacturer may simply submit to NPPA that the information is not available with them. The importer or manufacturer is not expected to retrieve this information from its supply chain and submit to NPPA. Being in possession of such information may in fact result in breach of anti-trust laws, as an attempt to undertake resale price maintenance.

Sale of imported medical devices marketed by marketer

Some importers import and sell directly to a marketer in India. In that case, it is the marketer who is supposed to provide this information as price related information is not available with the importer. However, the importer should ideally endorse and countersign the information submitted by marketer because the primary obligation to submit this information is with the importer. Alternatively, the importer may submit whatever information that it has and give a written undertaking along with the submission that the remainder of the information will be submitted by the marketer because the remaining information is unavailable with the importer.

Requirement of license

The direction also contains a note which states that manufacturers and importers must attach a copy of the licence obtained from the DCGI for each medical device. It may be difficult to furnish the manufacturing licence for Class A and Class B medical devices (such as Glucometer). The said licence is actually issued by State Licencing Authority of the state where the medical device is manufactured. In order to comply with the requirement of the direction, a copy of the licence issued by State Licencing Authority should be annexed in place of copy of license from DCGI.  

Format for submission

All the above information has to be certified by a qualified chartered accountant or cost accountant in a physical format, and the same information is also required to be sent in form of an Excel Sheet to the NPPA at the following email ID medicaldevices-nppa@gov.in

What should manufacturers and importers of medical device take this direction very seriously?

Any non-compliance with the direction of NPPA to submit price information may result in criminal prosecution under provisions of Essential Commodities Act of 1955.

The information will also be used to ascertain whether any manufacturer, importer or marketer has fixed the MRP of the medical device in excess of ceiling price or has increased the MRP over the permissible 10 per cent limit in a 12-month period. In both these cases, the NPPA has the power to recover the excess price paid by the end-consumer from the importer or manufacturer, and to levy a penalty for overcharging in certain cases.

That apart, the information will most likely be used by NPPA to track  or validate the market share of various medical devices and medical device manufacturers in terms of moving annual turnover (MAT) of said medical device under the submitted medical device category. If, at any time in future, a medical device is inserted in the schedule of DPCO on the grounds of essentiality to the Indian population, then the market share in terms of MAT will become an important consideration before NPPA in fixing the ceiling price that medical device.

Therefore, manufacturers and importers of the 24 categories of medical devices listed above must take this exercise seriously and submit the requisite data to the NPPA in prescribed form within timelines, both in physical and electronic format.