NPPA slaps Rs 20-cr fine on Cipla for overcharging

New Delhi, Dec 7 : Pharma company Cipla Ltd todaysaid it has received notices, demanding about Rs 20.15 crore,from drug price regulator for allegedly over-pricing two drugs.

The company has received a notice from sectoral regulatorthe National Pharmaceutical Pricing Authority demanding anamount of about Rs 20.14 crore, comprising allegedlyovercharged amount of Rs 11.54 crore and interest thereon ofRs 8.59 crore, in respect of the drug Ciprofloxacin, Ciplasaid in a filing to the BSE.

"The period to which these amounts pertain to have notbeen specified in the demand notice," the company said in itsfiling to the Bombay Stock Exchange (BSE).

The drug maker also got a notice demanding an amount ofRs 11 lakh comprising interest up to April 2009 in respect ofthe drug Doxycycline, it further said.

Both the drugs are antibiotic, used in treatment ofbacterial infections.

According to Cipla, notices are contrary to rulings ofthe Supreme Court and the demand is not tenable. There were nodetails of the ruling in the Cipla statement.

"These demands are contrary to the orders of the SupremeCourt and the company has received legal advice that entireamounts demanded by the government are not tenable andsustainable," Cipla said.

In July also, Cipla had received notices from NPPA foralleged over-pricing of two drugs--Salbutamol and Norfloxacin.

In July, Cipla had got a demand notice of Rs 64.39 crorefor asthma drug Salbutamol and Rs 2.19 crore for Norfloxacin,used in treating infections.

NPPA, under the aegis of Chemicals and FertlizersMinistry, is responsible for keeping an eye on the pricemovement of dugs in the country.

Shares of Cipla today settled the day at Rs 351.5, down1.99 per cent from its previous close on the BSE