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Supreme Court Stresses Need for Government Negotiations to Reduce Costs of Rare Disease Medicines

25 Feb 2025 1:21 PM - By Shivam Y.

Supreme Court Stresses Need for Government Negotiations to Reduce Costs of Rare Disease Medicines

The Supreme Court has put a temporary hold on the Kerala High Court's order, which had directed the Union government to procure medicines worth ₹18 lakh for a patient suffering from Spinal Muscular Atrophy (SMA). The Apex Court has instead urged the Union to explore avenues to subsidize these high-cost drugs.

Background of the Case

A bench led by Chief Justice of India (CJI) Sanjiv Khanna and Justice Sanjay Kumar was hearing an appeal against the Kerala High Court's division bench order. This order had clarified that a prior single bench ruling, which mandated the Union to procure costly drugs for treating SMA, should not be considered a binding precedent for other similar cases.

The case originated from the plea of a 24-year-old patient suffering from SMA, challenging the exorbitant pricing of the life-saving drug, Risdiplam. The patient sought intervention to ensure access to affordable treatment.

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The Supreme Court, while issuing notice to the Union’s petition, stayed the Kerala High Court’s directive until further hearings. The court order stated:

"Issue notice returnable in the week commencing 17th of April 2025... till the next date of hearing there will be a stay of the order of the impugned judgment."

The matter holds significance as the Apex Court is already handling multiple petitions filed by parents of children suffering from Muscular Dystrophy—a rare disease—seeking a structured policy for free treatment. Notably, on December 9, 2024, the Supreme Court also stayed the Delhi High Court's order, which had removed the ₹50 lakh cap on treatment costs for rare diseases, calling for a more flexible approach.

During the proceedings, the counsel for the respondents highlighted that countries like Pakistan and China have successfully negotiated lower prices for drugs treating rare diseases. This prompted the CJI to suggest that the Indian government should directly engage with pharmaceutical companies for price reductions.

"We would also ask the petitioners as well as the Union of India to get in touch with the company manufacturing these drugs to enable treatment for patients suffering from the said disease."

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The Supreme Court was informed that nearly 900 individuals in India suffer from similar rare diseases. CJI Khanna emphasized the necessity for government negotiations on a global level to make treatments more affordable:

"Find something out. There are 900 people suffering from this disease. The government can negotiate—perhaps by proposing bulk purchases or structured payments. If we keep paying so much money, the pharma companies might agree to reduce prices, maybe ₹50 lakh for an entire lifetime dose."

The Union's counsel, however, pointed out that the required medicines are custom-made for each patient, often administered monthly or bi-annually. This customization adds to the challenge of bulk procurement or fixed pricing.

Recognizing this complexity, the bench has allowed the respondents to submit details of how other countries have successfully negotiated subsidized rates for such drugs.

Case Details: UNION OF INDIA vs. SEBA P.A. | SLP(C) No. 004684 - / 2025