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In a major judicial ruling, a Division Bench of the High Court of Kerala, comprising Dr. Justice A K Jayasankaran Nambiar and Justice Preeta A K, has closed a Writ Appeal (W.A. No. 1397 of 2026) filed by Pharmadude Pharmacy at Vannappuram in Idukki district as infructuous.
The appeal had challenged an earlier Single Bench order dismissing the petitioner's challenge against the state Drugs Control Department’s regulatory action on licensing undertakings. The appellate bench observed that during the proceedings, the department produced a fresh administrative Circular dated July 23, 2026, along with standardized Form-A and Form-B affidavit formats. The court observed that because this fresh circular officially incorporated the rephrased undertaking agreed upon before the court, the grievance of the appellant stood fully redressed.
In its decision, the Division Bench highlighted that the discount pharmacy group’s primary concern in appealing was that, in the absence of a formal circular, the department might not uniformly apply the rephrased affidavit format across the trade. Upon receiving the senior government pleader’s memo containing the newly issued circular and affidavit formats, the judges verified that the department had formally aligned its licensing instructions with its court undertaking. By closing the Writ Appeal as infructuous rather than setting it aside, the Division Bench left the underlying judgment of the Single Bench fully operative while confirming that the new administrative circular effectively settles the issue for drug licensees across Kerala.
The legal dispute originated when discount pharmacy operators challenged the Drugs Controller’s September 4, 2024 circular, which required all new applicants and existing license holders to submit an affidavit undertaking not to display discount boards outside their shops. Petitioning retailers, including Pharmadude Pharmacy, argued before the Single Bench that selling medicines below MRP is permitted under the Drugs and Cosmetics Act and that restricting display boards infringed on their fundamental right to conduct business. However, in a landmark Single Bench verdict on June 19, 2026, Justice Bechu Kurian Thomas dismissed the chemists' petitions, holding that while retailers may sell below MRP, regulatory bodies possess full legal authority to curb misleading, vague, or deceptive discount displays to protect vulnerable patients.
The legal battle was originally spearheaded by the All Kerala Chemists and Druggists Association (AKCDA), which urged the state government and the Drugs Control Administration to intervene against aggressive discount boards offering arbitrary price cuts of 20 to 90 per cent. AKCDA raised serious public health and quality concerns, pointing out that legitimate chemists operate through authorized manufacturer-to-distributor channels where across-the-board heavy rebates are commercially unviable without compromising drug quality. The association maintained that predatory discount hoardings violated National Pharmaceutical Pricing Authority (NPPA) guidelines and Pharmacy Practice Regulations, while state regulators also voiced concerns regarding the questionable quality and unknown origins of heavily discounted drugs sourced from outside the state.
Following the Single Bench judgment, State Drugs Controller Dr K Sujith Kumar issued an enforcement directive to all Assistant Drugs Controllers and regional Drug Inspectors to launch a state-wide drive to remove deceptive discount banners, digital screens, and hoardings. The department mandated that new licence applicants file the revised declaration in Form A, while existing retail outlets were given a strict three-month deadline to submit their undertaking in Form B. Under the finalized terms, licensees explicitly undertake not to display discount boards containing misleading or vague claims regarding medicine prices, strengthening the department's ongoing monitoring initiatives such as ‘Operation Double Check’.
Meanwhile, the All Kerala Chemists and Druggists Association (AKCDA) has welcomed the decision of the Division Bench. Speaking to Pharmabiz, the state general secretary of the AKCDA, Antony Tharyan, said the Drugs Control Department should immediately initiate steps to implement the order of the Single Bench. He wanted all the members of the association to cooperate with the department in removing the discount boards from the medical shops.
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