Cracking Down On Online Medicine Fraud: The Amazon And Flipkart Scandal

Are e-commerce platforms convenient or covert? Should you buy medicines online? 

For the past few years, the country’s online pharmacy industry has received a boost from both the growing prevalence of digital technology and the Covid-19 pandemic. Among the most important companies operating in this market in the country are Tata’s 1Mg, the soon-to-be-public PharmEasy, Amazon Pharmacy, and Flipkart Health+.

Recent news has revealed that the most popular e-commerce stores, like Amazon, Flipkart, etc., sell medicines without license. The Drugs Controller General of India (DCGI) has issued show-cause notices to e-commerce giants Amazon, Flipkart Health plus, and 20 other online sellers for selling drugs without a license.

The notice regarding this Online Medicine Fraud asked these retailers to show cause within 2 days from the date of issue, why action has not been taken against you for sale, or stock, or exhibit or offer for sale or distribution of drugs in contravention of the provisions of the Drugs and Cosmetics Act 1940 and rules made thereunder.

The notice, issued on February 8 by DCGI’s VG Somani, cited a Delhi High Court judgment dated December 12, 2018. The notification prohibits the sale of drugs online without a license. The DCGI also forwarded the directive to all states and union territories in May and November, as well as on 3 February, for mandatory action and compliance.

This notice on the Amazon and Flipkart Scandal further states that the sale, stock, exhibit, or offer for sale or distribution of any medicine requires a license from the relevant state licensing body. In addition, license holders must follow the restrictions of their license. In the absence of a response, it will be assumed that the company will remain silent on the subject.

DCGI’s Response On This Amazon and Flipkart Scandal

In its notice, the DCGI cited the notice issued by the Delhi High Court in the case of Dr Zaheer Ahmed vs. the Union of India and others. This lawsuit is one of several that are now pending in various courts to prohibit the selling of medications via the internet. The High Court has given its verdict against the online sellers of medicines. 

According to the judgment issued by the court, “respondents are injuncted from the online sale of medications without a license and the respondents are required to ensure that the same is barred forthwith until further orders.” Even after the injunction was issued, it was discovered that e-pharmacies were still selling medications online without a license. 

According to the proposed legislation’s Section 41(2), online pharmacies seek a license to continue functioning as usual. The proposed legislation also offers further recommendations for the regulation of online pharmacies. If this bill were to become law, it would also make it illegal for online pharmacies to sell medical devices without obtaining a license.

Flipkart Health Plus Defense Against This Obligation

Flipkart Health Plus said, “We are a digital healthcare marketplace platform enabling easy and convenient access to genuine and affordable medicines and healthcare products, from independent sellers, for millions of customers across India.” They have received a notice from the Central Drugs Standard Control Organisation to which they are responding appropriately. 

“As an organization, we remain committed to complying with the laws of the land and towards continuous improvements of our processes/checks and controls on our marketplace platform to build trust and enhance customer experience,” Flipkart Health plus stated. They are declining the charges of doing any type of online medicine fraud

Meanwhile, CAIT (Confederation of All India Traders) National President BC Bhartia and Secretary General Praveen Khandelwal have asked the government to severely enforce the law and the Delhi High Court’s verdict and ensure that no e-commerce firm is selling medicine in violation of the Drug and Cosmetic Act.

“Government must take strict action against the e-commerce, e-pharma intermediaries, marketplace platforms including Amazon and Flipkart who are selling the medicine without obtaining the requisite license.” added the trade leaders. Email queries seeking comments over the development sent to Amazon India and others did not elicit any reply. 

CAIT added on this Amazon and Flipkart Scandal that several online medicine sellers are foreign-controlled. Therefore, they are ineligible to seek these retail licenses as this would violate the extant Foreign Direct Investment policy in the multi-brand retail sector or inventory-based e-commerce.

Statistics Related To Online Medicine Sale In India

About 5,000 startups are operating in India’s health technology sector. According to a report published by Research and Markets, the size of the Indian online pharmacy market was expected to be INR 25.50 Bn in 2021. It is anticipated that the market would rise at a compound annual growth rate (CAGR) of 22.20% to reach INR 89.47 Bn by 2027. 

Online medicine sellers have raised close to $6 billion in funding between 2014 and November 29, 2022. According to the data provided by Inc42, internet pharmaceutical firms raised $1.25 billion of this total. It is important to remember that in December 2021, the government published a draft of the New Medicines and Medical Devices Bill. 


It is hard to identify what will be the consequence of this Amazon and Flipkart Scandal. But, at least we can assume that by the involvement of DGCI, some solution will find its way. Also, the government will make some harsh rules regarding such online medicine frauds.

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