Doctor Pharma Nexus Unearthed: Post Micro Labs IT Raid, Health Minister directs NMC to Probe Doctor involvements with Pharma

New Delhi: The recent set of IT raids on the manufacturer of Dolo 650, Micro Labs has now led to a cascading effect on the medical profession with the government now moving to launch a separate and special investigation to unearth the unethical connections that the pharma company had with the doctors.

As a part of the raid, several names of doctors who have taken freebies from the said pharma company have come into the scanner with the Union Health Minister now directing the apex medical regulator to launch its investigation into the matter. 

Medical Dialogues had recently reported that the Central Board of Direct Taxes (CBDT) on Wednesday accused the makers of the widely-known Dolo-650 medicine tablet of indulging in "unethical practices" and distributing freebies of about Rs 1,000 crore to doctors and medical professionals in exchange for promoting products made by the pharmaceutical group. The CBDT is the administrative body for the I-T department.

The claims came after the Income Tax department had on July 6 raided 36 premises of Bengaluru-based Micro Labs Ltd. across nine states.

Read Also: Unholy Alliance? Dolo 650 maker gave Rs 1000 crore worth freebies to doctors, alleges Income Tax Department

"During the course of the search operations, substantial incriminating evidence, in the form of documents and digital data, has been found and seized...The initial gleaning of the evidence has revealed that the group has been debiting in its books of account unallowable expenses on account of the distribution of freebies to the medical professionals under the head 'sales and promotion'," it said.

The CBDT alleged these "freebies included travel expenses, perquisites and gifts etc. to doctors and medical professionals for promoting the group's products under the heads 'promotion and propaganda', 'seminars and symposiums', 'medical advisories' etc."

"The evidence indicates that the group has adopted unethical practices to promote its products/ brands. The quantum of such freebies detected is estimated to be around Rs 1,000 crore," it said.

Read also: Income Tax raid on Micro Labs manufacturer of Dolo 650

Now, according to a recent report by CNBC TV, taking cognisance of the recent findings shared by the Income Tax Department post its search operations against Micro Labs, the Ministry of Health and Family Welfare (MoHFW) and the Department of Pharmaceuticals have tasked the Ethics Committee under the apex medical regulator, National Medical Commission to probe into the matter.

"Mansukh Mandaviya, Minister for Health and Family Welfare and the Department of Pharmaceuticals have directed the ethics committee under National Medical Commission to look into the nexus of pharma companies and medical practitioners and doctors doing undue promotion and prescription of select medicines," senior government sources told CNBC-TV18.

Besides, the Ethics Committee has asked to submit their report as soon as they can with the findings on how the nexus exploited the market and excessive sales.
Further, the government has issued show cause notices to medical practitioners and doctors who were covered under the income tax action for irregularities and unfair practices, sources said.

According to sources' information to News18, the panel will be asked to understand the "modus operandi" of pharmaceutical firms. "So far, we understand that diabetes, cardio and psychiatry are the three segments where these pharma companies invest money and try to bribe doctors," said the second official from the ministry.

"They lure doctors on the pretext of giving hospital equipment, gold jewellery, foreign trips and other freebies," he said. "The minister's office has asked officials to gather all data and information from the CBDT's raid and take action against the culprits, including the doctors involved."

NMC Rules against Freebies and Penalty to Doctors:

Last month, the NMC issued the draft of "National Medical Commission Registered Medical Practitioner (Professional Conduct) Regulations, 2022" laying down many points prohibiting doctors AND THEIR FAMILIES from taking any kinds of gifts or money from pharma and medical device companies, linking the same to a penalty that can go upto 3 months suspension. The draft guidelines also stated that doctors may have to file an affidavit declaring their financial earnings and or benefits received in the past 5 past years from any pharmaceutical companies or allied health sector

Point 35 of the Chapter on "Duties of RMPs towards the Public and Allied Healthcare Professionals" clearly state that RMPS and their families cannot receive any gifts cash or kind from Pharma, going ahead and also preventing them from being involved in any CME ( now CPD), seminar, conference etc that is being sponsored by pharma. It clearly states

RMPs and their families must not receive any gifts, travel facilities, hospitality, cash or monetary grants, consultancy fee or honorariums, or access to entertainment or recreation from pharmaceutical companies, commercial healthcare establishments, medical device companies, or corporate hospitals. However, this does not include salaries and benefits that RMPs may receive as employees of these organizations. Also, RMPs should not be involved in any third-party educational activity like CPD, seminar, workshop, symposia, conference, etc., which involves direct or indirect sponsorships from pharmaceutical companies or the allied health sector.RMP should be aware of the conflict of interest situations that may arise. The nature of these relationships should be in the public domain and should not be in contravention of any law, rule, or regulation in force. An RMP himself or as part of any society, organization, association, trust, etc. should be transparent regarding the relationship with the pharmaceutical and allied health sector industry. (L3)

Point 36 also states that doctors may be required to file an affidavit declaring their dealings with pharma

RMPs may be required to file an affidavit regarding their financial earnings and or benefits received in the past 5 past years from any pharmaceutical companies or allied health sector. (L3)

The two points have been categorized as Level 3 for Penalties under the draft regulation, meaning the violation of the same will bring a penality which can involve suspension of license to practice for a maxmim period of three months

Level 3: This penalty may be awarded when the role of the doctor in causing direct harm was conclusively proved and the doctor was found to have breached relevant regulation. This maximum action is a suspension of the license to practice for a maximum period of three months. Holding suspension can be given in this level as per regulations

Read Also: Doctors to Declare their earnings from Pharma in Affidavit, Violations to bring 3-month suspension: NMC draft Ethics Guidelines