Maharashtra Food and Drug Administration (FDA) has backed down on its order cancelling the drug sale licence of Cipla Pharma & Life Sciences Limited’s Pune unit after strong comments from Bombay High Court. The regulator said it would withdraw the cancellation order immediately and issue a fresh show cause notice to the pharmaceutical company before taking any further decision.
The decision came after the Bombay High Court questioned the procedure followed by the FDA while cancelling the licence of Cipla’s carrying and forwarding facility at Wadki in Pune. The court criticized the regulator for acting in a “high-handed” manner and going “overboard” while dealing with the pharmaceutical company. The court also observed that the action appeared to be contrary to the principles of natural justice.
The FDA had earlier cancelled the drug sale licences of Cipla’s Pune facility on August 27. This followed inspections in which officials found some problems in the packaging, storage and recall of Reactin Plus Tablets. The regulator had raised concerns about unauthorised promotional text on the packaging, discrepancies in stock records and alleged non-compliance with recall-related directions.
Cipla subsequently filed suit with the Bombay High Court against the FDA for its action. The company said in court the regulator’s order had no data to show the safety, quality or efficacy of the products. Cipla also said the order did not involve any patient safety issue. The company’s challenge was the procedure the FDA followed before the licence cancellation.
What happened during Bombay High Court hearing?
During the hearing, senior counsel Aabad Ponda, representing Cipla, told the court that the FDA had sent an email asking the company to appear for a hearing on August 26. The hearing was held on August 26 as it was a public holiday and Cipla did not have a representative to attend the hearing on that day, the letter said.
The company sought to adjourn. However, according to the court’s submissions, the FDA passed the licence cancellation order on the same day without Cipla being able to speak at the hearing. This became a major issue during the court proceedings.
The FDA, represented by Additional Government Pleader P P Kakade, argued that the applicable law did not give the company a specific right to a hearing. But the court questioned the department’s decision to call the company for a hearing if it was ultimately going to pass the order without giving the company a meaningful opportunity to respond.
The bench of Acting Chief Justice Ravindra Ghuge and Justice Gautam Ankhad strongly questioned the process pursued by the regulator. The court acknowledged the FDA's role in maintaining pharmaceutical standards but said that the department had gone beyond what was appropriate in this case.
The judges also questioned if it was fair and transparent to ask a company to appear for a hearing on a public holiday and then proceed with an adverse order when the company requested additional time. The court compared the situation with judicial proceedings and questioned whether such a process could be considered fair if followed by a court.
Why did the FDA cancel Cipla's licence?
The original FDA action followed inspections at Cipla’s facility. During an inspection in June, officials found unauthorised promotional wording on the packaging of Reactin Plus Tablets, which is a Schedule H prescription medicine.
The FDA objected to the words “analgesic and antipyretic” appearing on the packaging. Such language might promote the use of a prescription medicine without legitimate medical advice, the regulator said. The concern was that consumers could take the advice about the product and self-medicate based on the information provided on the product packaging.
There were also other issues that were observed during the inspection, including differences in physical stock records and computerised stock records, gaps in purchase and sales documentation, and alleged shortcomings in complying with recall instructions issued by the regulator.
The FDA’s concerns then went well beyond the packaging issue and included aspects of inventory management, documentation and product recall procedures. Such inspections are part of the regulator’s duty to ensure that pharmaceutical businesses comply with applicable drug laws and regulatory requirements.
FDA to Issue Fresh Show Cause Notice
Following the court’s observations, the FDA agreed to withdraw the licence cancellation order. The regulator will now issue a fresh show cause notice to Cipla, giving the firm time to respond to the allegations.
After considering the company's response, the FDA is expected to issue a fresh and reasoned order. This means the underlying regulatory concerns have not necessarily been closed; rather, the process will be restarted in accordance with the procedure outlined during the court proceedings.
The case underscores the importance of due process when regulatory authorities take action against pharmaceutical companies. Regulatory responsibilities of drug regulators are significant when it comes to maintaining compliance and protecting public health, but companies should also have an opportunity to respond to allegations before punitive action is taken.
Cipla’s withdrawal of the cancellation order does provide some relief for its Pune plant, but the company’s regulatory fight with the Maharashtra FDA will not be over until the new show cause notice is issued. The next step will be Cipla’s response and decision from the regulator.
Indeed, the case is also important in that it illustrates the balance between strict pharmaceutical regulation and procedural fairness. When regulators find violations, they must act firmly, but the Bombay High Court’s intervention shows that enforcement actions must also follow established legal principles. The new process will determine how the FDA's concerns are ultimately addressed and whether any regulatory action is warranted against the company.
