Overcharging proceedings under DPCO
Also called: Overcharging demand, Overcharged amount recovery · Topic: Markets, Equilibrium and Government Intervention · NCERT: Beyond NCERT
Meaning
Overcharging proceedings are the legal action NPPA (National Pharmaceutical Pricing Authority, India's drug-price regulator) takes under the Drugs (Prices Control) Order, 2013 (DPCO). Overcharging means a company sold a medicine above the price the law allows. That could be the ceiling price of a scheduled drug, a revised MRP notified by NPPA, or a price rise on a non-scheduled drug beyond the 10% a year limit. NPPA works out the extra amount charged and issues an overcharging demand, asking the company to pay it back with interest. The threat of these proceedings is what pushes companies to obey price orders. The record is weak, though. As of 2025, Rs 8,526 crore (85%) of overcharging demands had not been recovered. About 70% of that unpaid amount is tied up in court cases, and some cases have been pending for over 20 years.
Example
From 9 November 2026, revised MRPs applied to 137 non-scheduled anti-cancer drugs under Trade Margin Rationalisation (TMR). If a hospital or dealer keeps charging the old, higher MRP, State Drug Controllers can report it. A patient can also complain on the Pharma Sahi Daam app. NPPA can then start overcharging proceedings against the company.
Don't confuse with
- Ceiling price fixation: this sets the maximum legal price in advance. Overcharging proceedings come afterwards and punish sales above that price.
- Consumer complaint (Pharma Sahi Daam): a complaint only reports overcharging. The proceeding is NPPA's legal action to recover the money.