Cipla gets notice for overpricing drugs; denies liability

Indian pharmaceutical company Cipla Ltd said on Monday that it has received a notice from the National Pharmaceutical Pricing Authority on overpricing two of its antibiotic drugs. Government watchdog NPPA has sought Rs11.55 crore and interest of Rs8.59 crore in respect of the drug Ciprofloxacin, the company said in a statement to the Bombay Stock Exchange.

Cipla said the demand was contrary to a Supreme Court ruling and it had legal advice the demand was not tenable. "The period to which these amounts pertain to have not been specified in the demand notice," it said.

The company also got a notice demanding an amount of Rs11 lakh by way of interest up to April 2009 in respect of its the drug Doxycycline, it further said. Both the drugs are used in the treatment of bacterial infections.

In July, Cipla had received a similar notice from the agency for alleged overpricing of two other drugs - Salbutamol and Norfloxacin. It had then got a demand notice of Rs64.39 crore for asthma drug Salbutamol and Rs2.19 crore for Norfloxacin, used in treating infections.

NPPA, under the chemicals and fertilisers ministry, is responsible for keeping an eye on the price movement of dugs in the country.