‘You are going overboard’: Bombay High Court pulls up FDA; Cipla licence cancellation withdrawn

The bench observed that FDA had acted in a “high-handed” manner and that its procedure in cancelling the licence was against the principles of natural justice.

Hours after the Bombay High Court accused the Maharashtra Food and Drugs Administration (FDA) of going “overboard” and acting in a “high-handed” manner, the regulator on Saturday withdrew its order cancelling the drug sale licence of Cipla Pharma and Life Sciences Ltd’s carrying and forwarding (C&F) facility at Wadki in Pune.

The FDA told the court that it would withdraw the cancellation order with immediate effect, issue a fresh show-cause notice to Cipla and, after considering the company’s response, pass a reasoned order. (HT Archive)

A division bench of acting chief justice Ravindra Ghuge and justice Gautam Ankhad said the FDA had followed the wrong procedure and acted against the principles of natural justice in cancelling the licence.

Order withdrawn

The FDA told the court that it would withdraw the cancellation order with immediate effect, issue a fresh show-cause notice to Cipla and, after considering the company’s response, pass a reasoned order.

Senior counsel Aabad Ponda, appearing for Cipla, told the bench that the FDA had directed the company to appear for a hearing on August 27 — a public holiday declared by the Maharashtra government. As no company representative was available on the holiday, Cipla sought an adjournment. The FDA, however, proceeded to cancel the licence the same day without granting the company a hearing, Ponda said.

Additional government pleader P P Kakade, appearing for the FDA, argued that the law did not give the company a right to a hearing.

The bench questioned the regulator’s decision to schedule the hearing on a public holiday and then proceed with the cancellation after the company sought more time.

“You are doing a laudable and appreciative job, but now you are going overboard. This is not the first time this is happening. You have wronged, and now you have to resolve the issue,” the bench observed.

The court also questioned whether it was fair and transparent for the FDA to ask the company to send a representative for a hearing on a public holiday. It noted that government departments themselves often seek adjournments on the ground that they cannot work on holidays.

The bench observed that the FDA had acted in a “high-handed” manner and that its procedure in cancelling the licence was against the principles of natural justice.

The FDA subsequently informed the court that it was withdrawing the cancellation order and would initiate the process afresh. Ponda told the bench that the court had given the regulator the option of withdrawing the order or having the court decide the matter.

The FDA’s action followed an inspection of the facility in June, during which officials found what the department described as unauthorised promotional text on the packaging of Reactin Plus, a Schedule H prescription medicine. The words “analgesic and antipyretic” were printed on the packaging, according to the FDA.

The regulator said such promotion of a prescription medicine could encourage people to take it without medical advice and increase the risk of self-medication. The inspection also found discrepancies between physical and computerised stock records, gaps in purchase and sale records, and non-compliance with directions relating to the recall of the tablets.

Cipla, while announcing on Friday that it had challenged the FDA’s action, clarified that the cancellation order did not allege any concern over the safety, quality or efficacy of its products and did not involve or indicate any patient-safety issue.