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Declare Covishield essential commodity, cap price at Rs 157 per vial, says plea in Supreme Court

The petitioner prays to declare the Covishield vaccine as an Essential Commodity and limit the pricing of Covishield vaccine to its cost price as mandated by the inventor Oxford University in its Intellectual Property policy.

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The Supreme Court on Thursday will hear a plea filed by Chirumamilla Kranthi Kumar seeking directions to quash the liberalized pricing and accelerated national Covid-19 vaccination strategy and to declare Covishield vaccine as an essential commodity.  (Chirumamilla Kranthi Kumar v Union of India & others)

A bench of Justices D.Y. Chandrachud, L. Nageswara Rao and S. Ravindra Bhat will hear the plea which has alleged that the Serum Institute’s profiteering and vulture-like pricing shouldn’t be allowed to remain and a price cap of “cost price” for the time of the pandemic should be imposed based on the following premises. 

Firstly, the Serum Institute of India neither invented the vaccine nor is paying any substantial royalty to the inventors for the time of the pandemic. They obtained sub-license to make vaccine easily available to lower and middle income countries likes India at no profit or minimal profit pricing and it was alleged that the Serum Institute is violating the policy.

Secondly, the profiteering of the Serum Institute of India at jacked up prices to the tune of over 380% of the already profit-making prices is severely limiting the access to the lifesaving vaccine in the midst of the pandemic and is causing consumer harm and is therefore denying the Right guaranteed by the Article 21.

Thirdly, the Clause 8 (ii)  of the “Liberalized Pricing and Accelerated National Covid19 Vaccination Strategy”  further allowed the vendors to choose the prices at which they would sell 50% of the vaccines produced at a price other than that which is sold to the Central Government (Rs 157.5), such discriminatory order should not be allowed to sustain.

Fourthly, the discriminatory Vaccine Pricing strategy of the Union government will drain the coffers of the already incapacitated state governments during the pandemic and would impact the state’s ability to utilize the money on critical medical infrastructure.

Fifthly, it is necessary and expedient that the Union Government declare the Covishield vaccine as an essential commodity and to announce an affordable and no profit price invoking the powers under Section-3 of the Essential Commodities Act, 1955 for increasing the supply at fair prices.

Sixthly, the Serum Institute is holding a dominant and monopolistic position in the Covid-19 vaccine market of India by holding over 80% of the market share whereas same vaccine is being sold in developed markets like European Union (EU) for 2-3 US dollars, which is considerably less than the prices sold in India.

The present petition has been filed in regard with hiked price of Covishield vaccine by Serum Institute, Pune and suspend the operation of Liberalized Pricing and Accelerated National Covid-19 Vaccination Strategy proposed by the Ministry of Health and also asked to appoint a fact-finding committee to ascertain the true cost of the vaccine by SII.

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The petitioner prays to declare the Covishield vaccine as an Essential Commodity and limit the pricing of Covishield vaccine to its cost price as mandated by the inventor Oxford University in its Intellectual Property policy. 

The Petitioner while calling the pricing announced by SII discriminatory i.e. Rs 400 and Rs 700, further prays to impose price ceiling of Rs 157 and make it available to both Government and Private hospitals.

Presently when the whole world is suffering from COVID19, the Jenner Institute of the Oxford University has invented and developed a vaccine (ChAdOx1) which can eliminate the pandemic and selflessly sacrificed its Intellectual Property for the benefit of global public at large. Later, the Serum Institute of India has obtained a sub-license form the licensee AstraZeneca to manufacture 1 billion doses of the aforementioned vaccine for low- and middle-income countries at no profit during the pandemic with a commitment to provide 400 million doses by the end of 2020, submitted by the Petitioner. The petitioner further revealed that the CEO of SII had admitted the fact that they are making the Oxford vaccine at a profitable price of Rs 157.5, which are being given to State/ provincial governments of India at Rs 400 per vial and to other Non-Governmental entities like private hospitals at Rs 600 per vial.

Liberalized Pricing and Accelerated National Covid-19 Vaccination Strategy

The Union Government in collaboration with State government has been working to ensure the maximum number of Indians are able to get the vaccine in the shortest possible time. 

The petitioner calls the said strategy to be discriminatory and further highlights that the Serum Institute’s profiteering and vulturous pricing shouldn’t be allowed to remain and a price cap of ‘cost price’ for the time of the pandemic should be imposed based on the following premises.

The petitioner through a PIL has sought the following directions; 

a. Issue a writ in the nature of mandamus or any other appropriate writ or direction or order to quash the “Liberalized Pricing and Accelerated National Covid19 Vaccination Strategy” and to declare Covishield vaccine as an Essential Commodity or pass any other order for limiting the pricing of Covishield vaccine to its cost price as mandated by the inventor Respondent-7 Oxford University in its Intellectual Property policy concerning the (ChAdOx1) vaccine which is manufactured in India by the sub-licensee Serum Institute of India(SII) in the tradename of Covishield and declare any non-compliance as violative of articles 14, 21 and 39 of the Constitution of India and de hors section 3 of the Essential commodities act , 1955.

b. Issue a Writ in the nature of Mandamus or any other appropriate writ or direction or order for correcting the discriminatory pricing of Covishield as announced by SII i.e Rs 400 and Rs 700 by imposing a price ceiling of Rs 157 invoking the special powers under Clause 19 of the DPCO, 2013 and make the vaccine available even to the State Governments and private hospitals at Rs 157, the price at which the Union Government of India procures till the pandemic lasts or appoint a fact-finding committee to ascertain the true cost price of the Covishield vaccine and mandate that the vaccine be sold at such ascertained price with a cap on profits during the time of pandemic.

c. Issue a Writ in the nature of Mandamus or any other writ for correcting the monopolised market and issue compulsory licences to other vaccine manufacturers so that the sub-licensee SII cannot resort to market and pricing distortion.

Read Also: Supreme Court to hear plea seeking directions to Centre, states to form a committee to monitor medical facilities for Covid-19 patients

d. Pass any other or further order/s or directions as this Court deems fit and proper in the attendant facts and circumstances of the case.

In the interim the petitioner has asked the Court to;

(a) Issue a status quo order on the pricing of the Respondent-6’s vaccine Covishield as the revised hiked pricing would come into effect from the 1st May, 2021.

(b) Issue an order to suspend the operation of the “Liberalized Pricing and Accelerated National Covid19 Vaccination Strategy” published by the Respondent-2 Ministry of Health.

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