Dolo 650 Row: Company Says ‘Impossible’ on Allegations of Rs 1000 Crore Marketing Budget

The Central Board for Direct Taxes has accused makers of the Dolo-650 tablet of distributing freebies worth Rs 1,000 crore to doctors as consideration for prescribing the tablet.

Written by: ANI Edited by: Priyanka

Published: August 19, 2022, 9:29 PM IST

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https://www.india.com/business/dolo-650-row-company-says-impossible-on-allegations-of-rs-1000-crore-marketing-budget-5582279/ Copy

An NGO, based on some findings of the Central Board of Direct Taxes (CBDT), had raised the issue related to freebies being used to encourage doctors to prescribe drugs.

New Delhi: Bengaluru-based pharmaceutical company Micro Labs Limited on Friday termed allegations that it had gifted freebies worth Rs 1000 crore to doctors to promote its Dolo-650 tablets as “baseless and incorrect”. The company claimed that the brand had done a business of just Rs 350 crore when Covid was at its peak and it was simply unviable for it to promote the drug by spending a much larger amount.

“It is impossible for any company to spend Rs 1000 crore on the marketing of a brand which did 350 crore in the Covid year. That too when Dolo 650 comes under NLEM (price control),” said Jayaraj Govindaraju, Executive Vice President, Marketing and Communication, Micro Labs Limited while speaking to ANI.

Govindaraju also claimed that it was not just Dolo tablets but several other products of the company that were used widely due to the COVID onslaught. “It was not just Dolo 650, even other COVID protocol drugs like Vitamin C and Vitamin combinations also did very well during COVID,” he added.

SC says ‘serious issue’

The Supreme Court on Thursday described the matter pertaining to the allegation that the manufacturer of Dolo 650 had distributed freebies worth Rs 1000 crore as a “serious issue”. An NGO, based on some findings of the Central Board of Direct Taxes (CBDT), had raised the issue related to freebies being used to encourage doctors to prescribe drugs.

The Supreme Court asked the Centre to file its response within 10 days on the PIL seeking directions to make pharmaceutical companies liable for giving freebies to doctors as an incentive. A bench of Justice DY Chandrachud and Justice AS Bopanna was informed that makers of Dolo-650 mg tablet had invested Rs 1,000 crore in freebies to have its anti-fever drug prescribed to patients.

CBDT alleges freebies worth Rs 1,000 crore given to doctors

The CBDT has accused makers of the Dolo-650 tablet of distributing freebies worth Rs 1,000 crore to doctors as consideration for prescribing the tablet, said senior advocate Sanjay Parikh, appearing for the Federation of Medical and Sales Representatives Association of India. Justice DY Chandrachud remarked that it is a “serious issue” and said that even he was prescribed the same tablet during COVID.

Price control of drug molecules

• According to Dr Chandra Gulati, Editor, Monthly Index of Medical Specialities (MIMS), not only drugs formulations but their molecules should also come under price control to avoid such activities.
• “My views are that there are about 2000 molecules in India and out of that not even one-third are under control and companies can price them the way they want. The problem is that the basic salt isn’t under price control, what is under price control is the formulation. For example, if paracetamol is 500, 600, or 125 miligram. Now, if the paracetamol is under price control then the problem is over, but it’s not like that,” Dr Gulati said.
• “The problem is certain formulations of a paracetamol are under price control like 500 mgm is under control, but 650 mgm paracetamol isn’t. So they can sell the drug at higher prices.” he said.

Distribution commission and more

• A Delhi based drug distributor, Kanav Nangia, said the price of Crocin and Dolo 650 is similar but the distribution commission is more in Dolo 650. “Still the demand for the medicine is high because of the viral fever and COVID,” the distributor said.
• When asked about these aspects, Govindraju claimed that the Dolo-650 manufacturer had reduced the distribution rate as well.