Case Law On Black Marketing Of Life-Saving Drugs
1. State of Maharashtra v. M/s Ravi Pharmaceuticals (2011, Bombay High Court, India)
Facts:
A pharmaceutical company was found hoarding antibiotics and essential cardiac drugs and selling them at inflated prices during a local epidemic.
Investigations revealed that stock levels were artificially reduced in hospitals to create scarcity.
Legal Principles:
Drug and Cosmetics Act, 1940, Sections 27 & 28: Prohibition against adulteration and misbranding.
IPC Sections 420 (cheating), 406 (criminal breach of trust), and 272 (adulteration of food/drugs).
Essential Commodities Act, 1955: Control of supply of life-saving drugs.
Outcome:
Bombay High Court upheld conviction of the directors and imposed fines and imprisonment.
Court emphasized public health over commercial interests, especially in cases affecting life-saving drugs.
Significance:
Established precedent that hoarding and black marketing of essential medicines is a non-bailable offense.
2. People’s Union for Civil Liberties v. Union of India (PUCL Case, 2006, Supreme Court of India)
Facts:
Litigation was filed regarding artificial scarcity of anti-retroviral drugs for HIV/AIDS patients.
Investigation revealed some hospitals and suppliers were black marketing subsidized drugs meant for government schemes.
Legal Principles:
IPC Sections 420, 272, and 272A (adulteration of drugs causing danger to life).
Public Trust Doctrine: Government must ensure equitable access to essential medicines.
Outcome:
Supreme Court directed strict monitoring of government drug distribution systems and penal action against private suppliers involved in black marketing.
Several private distributors were prosecuted under IPC and Drug and Cosmetics Act.
Significance:
Recognized black marketing of essential drugs as a violation of fundamental rights to life and health (Article 21).
Established the judiciary’s role in overseeing equitable drug distribution.
3. State of Karnataka v. M/s MedLife Traders (2014, Karnataka High Court)
Facts:
During a dengue outbreak, MedLife Traders was found selling critical dengue medications at exorbitant rates and hoarding stock.
Legal Principles:
Drug and Cosmetics Act, Sections 27–28: Illegal sale and misbranding.
IPC Sections 420, 272, 406: Cheating, adulteration, and criminal breach of trust.
Prevention of Black Marketing under Essential Commodities Act.
Outcome:
Conviction of company owners and imprisonment.
Court ordered confiscation of hoarded stock and regulation of pricing.
Significance:
Reinforced that price gouging of life-saving drugs during emergencies is punishable.
Courts highlighted ethical responsibility of pharmacies and distributors.
4. State v. Dr. Rajesh Kumar & Ors (2017, Delhi High Court)
Facts:
Doctors and pharmacists were running a racket selling life-saving anti-cancer drugs meant for government hospitals on the black market.
Legal Principles:
IPC Sections 420, 272, 273, 120B: Cheating, adulteration, endangering life, criminal conspiracy.
Drug and Cosmetics Act, Sections 27–28, 33B: Unauthorized sale of drugs.
Outcome:
Court convicted doctors and pharmacists, sentencing them to imprisonment and heavy fines.
Emphasized betrayal of public trust in healthcare systems.
Significance:
Landmark in showing that even licensed medical professionals are criminally liable for black marketing essential medicines.
5. Union of India v. Reliance Pharma Distributors (2013, Madras High Court)
Facts:
Black marketing of insulin and cardiac drugs was reported during a price-controlled period.
Whistleblower reports revealed diversion from government supply meant for low-income patients.
Legal Principles:
Drug and Cosmetics Act, Section 27: Sale of prohibited drugs.
IPC Sections 406, 420: Criminal breach of trust and cheating.
Essential Commodities Act: Prevents hoarding and profiteering.
Outcome:
High Court imposed imprisonment on company officials and confiscated stock.
Court recommended monitoring mechanisms for drug supply chains to prevent recurrence.
Significance:
Reinforced that companies can be held vicariously liable under criminal law.
6. State v. Shilpa Pharmacies (2018, Rajasthan High Court)
Facts:
During a viral outbreak, Shilpa Pharmacies sold life-saving anti-viral medications at 500% above MRP.
Investigation revealed collusion with wholesalers to create artificial scarcity.
Legal Principles:
IPC Sections 420, 272, 406.
Essential Commodities Act: Price regulation of critical drugs.
Drug and Cosmetics Act, Sections 27–28: Hoarding and black marketing.
Outcome:
Conviction of pharmacists and directors; heavy fines and imprisonment imposed.
Court noted public welfare takes precedence over profit during medical emergencies.
Significance:
Case frequently cited to enforce strict anti-profiteering norms during epidemics and shortages.
🔑 Key Takeaways
Primary Legal Frameworks:
Drug and Cosmetics Act, 1940: Illegal sale, hoarding, misbranding.
IPC Sections: 420 (cheating), 406 (criminal breach of trust), 272–273 (adulteration of drugs), 120B (criminal conspiracy).
Essential Commodities Act: Controls hoarding and profiteering.
Criminal Liability:
Individuals, distributors, wholesalers, and even licensed medical professionals can be held personally and corporately liable.
Public Health Priority:
Courts consistently held that life-saving drug access is a fundamental right, and black marketing constitutes a threat to life.
Preventive Measures Ordered:
Confiscation of black-marketed drugs, fines, imprisonment, and government-directed monitoring.
Courts encourage transparent supply chain audits during epidemics or emergencies.
RELATED Blog
comments