Supreme Court Decision on Regulation of Oxytocin Manufacturing: A Definitive Ruling

In a significant legal development, the Supreme Court of India has delivered a crucial verdict on the regulation of Oxytocin manufacturing. This ruling is set to have far-reaching impacts on the pharmaceutical industry and public health policies. Stay informed as we delve deeper into the details and repercussions of this momentous decision.


  • The Drug Consultative Committee (DCC) and Drugs Technical Advisory Board (DTAB) have recognized the definite role of Oxytocin in the medical field for both humans and animals.
  • Domestic manufacturers being prohibited from manufacturing Oxytocin may lead to smuggling from neighboring countries for illegal use.
  • Enhanced surveillance by regulatory authorities is essential to contain misuse, followed by strict actions against violators.
  • Schedule H1 prescription drugs have stricter control measures compared to Schedule H drugs.
  • The sale of Oxytocin has been regulated by amending package size to single blister packs.
  • Oxytocin is considered an essential life-saving drug and listed in the National List of Essential Medicines (NLEM).
  • The misuse of Oxytocin, especially in milch animals, has been a subject of discussion by statutory bodies like DTAB and DCC.
  • The manufacturing and sale of Oxytocin have faced challenges due to rampant misuse.
  • Various notifications and recommendations have been issued to regulate the production and distribution of Oxytocin.
  • The Ministry of Health and Family Welfare has issued notifications to restrict and control the manufacture and sale of Oxytocin formulations.
  • The DTAB and DCC have recommended measures like surveillance, monitoring, and strict regulations to curb misuse of Oxytocin.
  • The High Court upheld the validity of the Notification to prevent misuse of Oxytocin.
  • The Delhi High Court later quashed the impugned notification, citing lack of legal authorization for creating a state monopoly.
  • The impugned notification was deemed arbitrary and unreasonable.
  • Insufficient scientific data and rationale were cited for the decision to restrict Oxytocin production to one licensee, KAPL.
  • The decision was influenced by a previous Himachal Pradesh High Court ruling.
  • Concerns were raised about potential maternal fatalities due to restricted availability of Oxytocin.
  • The stay on the impugned notification was extended multiple times.
  • A previous notification from 2014 restricting Oxytocin manufacture and sale was also challenged in court.


  • Whether a drug included in the National List of Essential Medicines published under Schedule 1 of the Drugs (Prices Control) Order, 2013 notified under Section 3 of the Essential Commodities Act, 1955 would be subject to the provisions of Section 26A of the Drugs and Cosmetics Act, 1940.
  • The interpretation and application of Section 26A in relation to essential medicines.
  • Analysis of the legal implications of including a drug in the National List of Essential Medicines under the Drugs (Prices Control) Order.


  • The DTAB meeting did not recommend restricting Oxytocin manufacture to public sector only
  • Impugned Notification does not create a state monopoly in favor of KAPL, allows export and overseas sales
  • Impugned Notification restricts but does not completely prohibit Oxytocin manufacture
  • High Court ruling allows partial ban on drug manufacturing by private entities in public interest
  • Impugned Notification protected under Article 19(6) of the Indian Constitution
  • Presumption of constitutionality for subordinate legislation, burden of proof on respondents
  • Licensed manufacturers responsible for leakage leading to spurious Oxytocin production
  • Central Government’s decision based on High Court ruling and data on overproduction and leakage
  • Impugned Notification affects private sector licensees, stands cancelled practically
  • Constitutional challenge on grounds of being arbitrary, discriminatory, and disproportionate
  • Impugned Notification impact on Article 19(1)(g) as it prohibits manufacturing without export license
  • Restrictions on trade can be created via notification
  • Original basis of notification questioned as irrelevant, sudden change in approach highlighted
  • Central Government decision balances animal and human health, public interest noted
  • Judicial review limitations on legislative act, discretion on public health matters
  • Impugned notification discriminated against private sector licensees favoring public sector monopoly
  • Statutory bodies did not recommend complete prohibition for private licensees
  • Impugned notification aimed at public interest for bovine health and environmental protection
  • Critique on High Court exceeding jurisdiction, policy decision review cautioned
  • No prosecution or notice issued for misuse by Respondent-Manufacturers, notification deemed arbitrary
  • Misuse not covered under Section 26A for regulating licensed drugs
  • Power of Section 26A should not be used to restrict essential drug misuse
  • Act provides level playing field for drug manufacturing, distribution, and sales
  • KAPL obtained a license to manufacture the drug in April 2018, just before the impugned notification was passed.
  • Oxytocin is considered an essential drug listed under the NLEM, and the Central Government’s use of Section 26A of the Act was challenged.
  • The creation of a monopoly in favor of a public sector corporation, KAPL, was highlighted as a concern for the drug’s supply and availability in hospitals and for patients.
  • Manufacturing of the drug by KAPL began after the passing of the impugned notification in May 2018.
  • Under the Impugned Notification, only KAPL would be allowed to manufacture Oxytocin for domestic purposes, potentially impacting the market significantly.


  • Section 26-A of the Act confers wide powers on the Central Government to regulate, restrict, or prohibit the manufacture, sale, or distribution of a drug if certain conditions are satisfied.
  • The Central Government is not bound by the recommendations of the Drug Technical Advisory Board (DTAB) or the Drug Consultative Committee (DCC).
  • Several case laws were cited to support the argument, including Akadasi Pradhan vs State of Orissa, Khoday Distilleries Ltd. v State of Karnataka, Daruka & Co v Union of India & Others, Indian Drugs & Pharmaceuticals Ltd. v. Punjab Drugs Manufacturers Association, and Municipal Committee, Amritsar v State of Punjab.
  • The Central Government can independently determine the misuse of a drug, such as Oxytocin, and its harmful effects on animals and humans.
  • The exercise of power under Section 26A is not legislative in nature, as it is based on the ‘satisfaction’ of the Central Government alone.
  • The Central Government cannot create a state monopoly in the manufacturing of a drug for domestic sale under Section 26A and claim protection under Article 19(6) of the Constitution.
  • The ‘satisfaction’ of the Central Government was based on the factum of misuse deliberated by the DTAB and DCC.
  • The misuse of Oxytocin has been deliberated by the DCC and DTAB for the past 21 years, forming the basis of the impugned Notification.
  • The impugned Notification is not a form of delegated legislation according to the introduction of Section 26A in the Act.
  • The Drug Control Department found that several drugs manufactured by KAPL were of Non-Standard Quality as recently as October 2018.
  • The Act and accompanying Rules have mechanisms in place to counter contraventions by licensed manufacturers.
  • The exercise of power under Section 26A is a serious issue with far-reaching implications.
  • The NLEM is listed in the Schedule to the DPCO notified by the Central Government, and power under Section 26A cannot be exercised in respect of NLEM drugs.
  • The impugned notification under Section 26A is ultra vires as it runs counter to the DPCO and Section 6 of the Essential Commodities Act, 1955.
  • The twin issues are the unregulated manufacture of Oxytocin and its misuse in milch animals, and the continued supply of this essential life-saving drug for post-partum haemorrhage.
  • The impugned notification does not violate the right to carry on trade or business of the private sector companies under Article 19(1)(g)
  • The impugned notification restricts the manufacture, sale, or distribution of a drug that is already prohibited under Section 18 of the Act
  • Question of whether the notification creates a monopoly in favor of public sector companies to the exclusion of private sector companies
  • Examining if the classification between public and private sector companies in the manufacture of the drug Oxytocin for domestic use is justifiable
  • Considering if restricting the manufacture of a life-saving drug to a single public sector undertaking is in public interest, especially given high maternal mortality rates
  • Assessing if there was relevant and objective material before the Central Government to prohibit private sector companies from manufacturing the drug for domestic use
  • Exploring if the objective of curbing clandestine manufacture and unregulated use of Oxytocin can be achieved by banning the manufacture of licensed drugs by private sector companies
  • The court has identified important questions of law that require a definitive decision.
  • It is deemed suitable to refer the matter to a larger Bench of three Judges for consideration.
  • The larger Bench will provide an authoritative ruling on the identified questions of law.


  • The present group of appeals will be placed before the Hon’ble Chief Justice of India for necessary directions.


Case Number: C.A. No.-006588-006591 / 2019

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