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January 2019

Diagnosing the issues of E-pharmacies


By Ahalya Chalasanil

With the increasing usage of internet, sale of most day to day things have gradually changed from traditional shops to online retail. Pharmacies are no exception to this. Though retail E-pharmacies began in Europe sixteen years ago, India is a recent entrant into this arena.  Of late, there has been a lot of debate on the pros and cons of E-pharmacies and the risks involved. The latest judgments of Delhi and Madras High Courts, imposing a ban on E-pharmacies, are a result of the imminent risks posed by E-pharmacies in the absence of proper regulation.

This article analyses the various issues associated with E-pharmacies while giving an overview of Draft E-pharmacy Rules, 2018 and drawing a parallel between India, Europe and United States of America in relation to E-pharmacy regulations.

Regulations governing sale of drugs in India

At present, sale of drugs in India is regulated by Drugs and Cosmetics Act, 1940 (“Act”) and Drugs and Cosmetics Rules, 1945 (“Rules”). The Act and Rules govern the offline sale of drugs and do not prescribe any specific regulations for online sale. The Pharmacy Act, 1948 and Pharmacy Practice Regulations, 2015 are also relevant for sale of drugs as they impose certain obligations and duties on pharmacists in connection with preparation and sale of drugs. To regulate the sale of drugs online, a Sub-Committee was constituted by the Drugs Consultative Committee, which is a statutory body under the Act. Based on the recommendations of this Sub-Committee submitted in its report in the year 2016, the Draft E-pharmacy Rules, 2018 (“Draft Rules”) were notified by the Ministry of Health and Family Welfare on August 28, 2018.

While there are many advantages associated with E-pharmacies such as easy accessibility to drugs, competitive pricing etc., there are also a few challenges. It will be difficult to monitor the number of times drugs are ordered through a single prescription. This increases the risk of drug abuse, especially Schedule X drugs and other such drugs which are prohibited for sale without a prescription. Further, minors and children can also order drugs online due to easy internet access and it will be a challenge to monitor who is actually procuring the medicines through E-pharmacies. As is associated with any product purchased online, the risk of getting fake or unauthentic drugs is imminent in case of E-pharmacy as well.

Ban on E-pharmacies

A petition [Endnote 1] was filed by one Dr. Zaheer Ahmed in Delhi High Court, seeking a ban on sale of drugs online. This petition was filed after he came across one of his patients who obtained certain Schedule X drugs through an E-pharmacy without any prescription. The Delhi High Court imposed an interim ban on sale of drugs online till January 8, 2019.

Another petition [Endnote 2] was filed in the Madras High Court seeking a ban on sale of drugs by the Tamil Nadu Chemists and Druggists Association. The Madras High Court also imposed an interim ban on sale of drugs online from December 20, 2018 until regulations are notified by the Government in this regard. However, after an appeal, the ban was suspended temporarily by the Madras High Court while reserving its orders on stay of the interim ban.

The position on sale of drugs online is somewhat unclear at the moment. However, more clarity is expected after the judgments in the aforementioned matters are pronounced and once the final regulations are notified.

Overview of the Draft Rules
The Draft Rules attempt to tackle the various risks posed by E-pharmacies. Some of the important measures proposed by Draft Rules include-
  1. Registration of E-pharmacies – No person is allowed to sell drugs online without obtaining registration for the same.
 
  1. E-pharmacy portal – All orders for E-pharmacies shall be placed only through E-pharmacy portal. Therefore, it is mandatory for every E-pharmacy to have an E-pharmacy portal.
 
  1. Protection of privacy – E-pharmacies should keep all customer information confidential including prescription related information and adhere to applicable information technology laws in India. Further, E-pharmacy portal should be established in India and the data generated should be localised.
 
  1. Sale through cash/credit memo – The supply of drugs by E-pharmacies shall be made only against a cash or credit memo and such memos should be maintained as record.
 
  1. Measures to tackle counterfeit drugs, unauthorised sale and expired products -
    1. Details like name, address and license number of the licensee who is dispensing the drugs, should be mentioned on the memo.
    2. Serial number and date of the memo should be mentioned on the memo.
    3. Details of the drug including name, quantity, batch number, expiry date, manufacturer name should be mentioned on the memo. 
    4. Details of E-pharmacy including name, address and signature/ digital signature of registered pharmacist in-charge should be mentioned on the memo.
 
  1. Prohibition of certain Drugs – E-pharmacies are prohibited from selling drugs covered under the categories of the narcotic and psychotropic substance as referred to in the Narcotic Drugs and Psychotropic Substances Act, 1985 , tranquilizers and the drugs as specified in Schedule X of the Rules.
 
  1. Periodic Inspection of E-pharmacy - The premises from where the E-pharmacy business is conducted shall be inspected, every two years, by the concerned authorities.
 
  1. Details of Drugs and Patients on the E-pharmacy portal - The details of the drugs dispensed including the patient details shall be maintained on the e-pharmacy portal.
 
  1. Verification by registered pharmacist – Every prescription received on E-pharmacy portal should be verified by a registered pharmacist on behalf of the E-pharmacy and details of the patient, registered medical practitioner shall be checked.
 
  1. Prevention of unauthorised sale – All E-pharmacies shall be required to maintain and update information regarding the drugs availability, types of drugs offered for sale, supply channels or vendor lists, details of registered pharmacists, registered medical practitioner etc.
Sub-Committee recommendations vis-à-vis Draft Rules

While the Draft Rules are definitely a step towards regulating E-pharmacies and tackling the imminent risks associated with them, there are a few lacunae in the Draft Rules which may hinder the effective implementation of a few recommendations of the Sub-Committee.
One of the recommendations of the Sub-Committee is to create a National Nodal Platform for transacting and monitoring online sale of drugs. However, the Draft Rules provide only for an E-pharmacy portal and not a nodal platform, which may restrain proper centralised tracking and monitoring of transactions that will take place through online platforms. Constituting a National Nodal Platform would help tackle the challenges posed by an E-pharmacy such as drug abuse, multiplicity of orders, tracking of nation-wide range of customers and the drugs sold to such customers.

European Union (“EU”) law on E-pharmacies

Though there were regional laws and regulations on E-Pharmacies in Europe, the need for an international agreement or regulation on online sale of drugs became evident in the EU after the 2003 case[Endnote 3] involving Germany and Netherlands.

This case concerned the sale of prescription and non-prescription drugs in Germany by one DocMorris company, a company established in Netherlands. DocMorris was accused of illegal practice by the German Association of Pharmacists. Drugs could be ordered from the company through several ways including phone, fax, online etc. However, few products offered by the company were ‘prescription-only’ in Germany or the Netherlands.  The European Court of Justice held that Member States may not prohibit sale of non-prescription drugs online however, a Member State may prohibit distance selling of prescription drugs.
  1. EU logo for online sale of medicines
The European union introduced a common logo for regulating E-pharmacies through the Falsified Medicines Directive[Endnote 4] and later the European Commission adopted it[Endnote 5]. This logo on an E-pharmacy website ensures safety of the drugs and authenticity of the website. The European Commission adopted the common logo in June, 2014 and currently, all E-pharmacies in European Union are required to display this logo.
  1. Directive on falsified medicinal products
This Directive [Endnote 6] is applicable since January 2013 and introduces measures to fight medicine falsifications and ensure that medicines are safe and trade in medicines is effectively regulated. Significant measures imposed by this Directive are as follows:
  1. Tracking and tracing: The measures provide for a unique identifier and an anti-tampering device on the outer packaging of medicines.
  2. Stricter Rules on import of certain ingredients: Directive on falsified medicinal products mandates written confirmation from competent authorities to import certain active ingredients.
US Law on E-Pharmacies
In US, E-pharmacies are governed by both federal and state legislations. Amongst existing regulations governing E-pharmacies in US, a few notable measures include –
  1. Mandatory registration for sale of controlled substances: Every pharmacy that dispenses controlled substances[Endnote 7] must be registered with the Drug Enforcement Administration (DEA)
 
  1. Electronic Prescription for Controlled Substances (EPCS): While maintaining control on controlled substances, under this rule, practitioners are enabled to issue electronic prescriptions for controlled substances.
 
  1. In-person Medical Evaluation: Under the Ryan Haight Online Pharmacy Consumer Protection Act, 2008, any practitioner issuing a prescription for controlled substance must conduct in-person medical evaluation at least once every 24 months.
Conclusion

Regulation on E-pharmacies is certainly ineluctable considering the significant impact they can have on people’s health and safety. As directed by the Madras and Delhi High Courts, the Rules on E-Pharmacies should be introduced with extreme urgency. The Indian Laws on E-pharmacies should take into consideration the measures introduced by various other developed countries like US and EU such as tracking system, common logo, electronic prescription for certain drugs etc. to tackle problems associated with effective implementation and regulation of E-pharmacies.

[The author is an Associate in Corporate practice, Lakshmikumaran & Sridharan, Hyderabad] 

End note:-

  1. Zaheer Ahmed vs Union of India & Anr, Writ Petition (C) No:11711/2018
  2. Tamil Nadu Chemists and Druggists Association vs Union of India & Ors, Writ Petition (C) No:28716/2018
  3. Deutscher Apothekerverband v 0800 DocMorris NV, (2003) C-322/01
  4. Directive 2011/62/EU
  5. Implementing Regulation 699/2014
  6. Supra 4
  7. “controlled substance'' is generally a drug or chemical whose manufacture, possession, or use is regulated by a government, such as illicitly used drugs or prescription medications that are designated by law. In US, it means a drug or other substance, or immediate precursor, included in schedule I, II, III, IV, or V of the Controlled Substances Act, 1970.

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