“We have requested the Government not only to ban marketplace e-pharmacies who have been playing with the lives of the Indian consumer but also to permit only those registered e-pharmacies,” the Confederation of All India Traders (CAIT) said in a press statement. The traders’ body has sent a letter dated April 11 to the Union Commerce Minister and Union Health Minister urging them to ban the recently launched Flipkart Health+ platform as well as other existing online pharmacies.

Flipkart Health+, which launched last week, is a new app from the e-commerce giant, that sells medicines and healthcare products from independent sellers. The app looks to leverage Flipkart’s recent acquisition of SastaSundar.com, but the online healthcare space is plagued with regulatory uncertainty, leading to CAIT’s call for a ban of the app.

The government in August 2018 published a draft policy to regulate e-pharmacies, but it is yet to be finalised. Responding to MediaNama’s Right to Information (RTI) request on the status of the draft amendments, the Ministry of Health and Family Welfare said that “it may not be possible to say any timelines at this stage for finalisation of the draft rules.”  The delay in these regulations is leading to increased calls for restrictions on apps operating in the online healthcare sector. CAIT, along with the Delhi-based South Chemists and Distributors Association (SCDA), had last year urged the government to reject the initial public offering (IPO) of PharmEasy on the grounds of illegality. SCDA had previously also opposed Tata’s acquisition of 1MG and Reliance’s acquisition of NetMeds.

Why does CAIT want a ban on online pharmacies?

  1. Against the Drugs and Cosmetics Act and Rules: CAIT has, on multiple instances, pointed out that the Drugs and Cosmetics Act and Rules (DC Act and Rules) regulate the import, manufacture, sale and distribution of drugs in India and have strict mandatory requirements keeping in mind public health and safety. A valid license under these regulations is required to sell medicines. CAIT alleged that the sellers on marketplace platforms like Flipkart Health+ do not have this requisite license, which “puts health and safety of Indian consumers in jeopardy.”
  2. No liability for the platforms: CAIT also alleged that marketplace e-pharmacies hide behind intermediary provisions granted by the IT Act, 2000, to avoid any liability or responsibility in the case an adulterated or spurious or counterfeit or incorrect drug reaches the consumer.
  3. Deep discounting: Online pharmacies also engage in deep discounting and predatory pricing by way of cash burning, CAIT alleged.

“To prevent intermediaries from getting into creative agreements and operate marketplace e-pharmacy platforms, we have also requested the government to ensure that no person must be allowed to establish a web portal to act as an intermediary between the e-pharmacy entity and consumer. – CAIT

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