A Division Bench comprising Chief Justice S N Variava and Justice S K Mahajan directed the Ministries of Health and Chemicals to file replies by August 8, the next date of hearing.

The court also issued notices to chairman of the Bureau of Industrial Costs and Pricing and National Pharmaceutical Pricing Authority on a public interest litigation (PIL) which said that "run-away prices of drugs is making it impossible for common man, particularly in the rural areas to afford the cost of medicines."

This was directly "hitting" at the citizens' health standard, working capacity of people and span of their lives, the petition said.

The petition moved by advocate B L Wadhera said that the control on drug prices which was effectively enforced for the first time in 1970 under Drug Price ControlOrder (DCPO) imposing ceiling on maximum price of all drugs, started losing its "grip" in subsequent DCPOs.

"The 1995 drug policy, which was result of the so-called liberalisation has utterly failed to control the prices of almost all medicines," it said.

The petition said barring few antibiotic, non-steroidal anti-inflammatory and some gastro-intestinal drugs, the prices of all drugs of therapeutic categories had increased "phenomenonally".

"This has been admitted even by the government in a note circulated by the department of chemicals and fertilizers in November 1997," it said.

The note inter-alia stated that product wise price control had led to stagnation in terms of new products and to proliferation of existing products, creating confusion in the minds of the consumers as also rendering price control system impractical, the petitioner claimed.

"There is inadequate machinery for administering price control with the existing set up. The government is able to fix prices of about 2,000 to 2,500packs per year against the 25,000 estimated to be under price control," it said, adding that it clearly indicated that the government was only able to monitor the prices of about 10 per cent packs.

"Even for 10 per cent packs, in fact, no data is now being analysed and the price revision comes automatically if the government does not respond within three months of the price revision applications," the petition said.

The petition said 7,437 new packs were introduced in the market between 1993 and 1997 which include "brand variants, pack variants and new molecules". Of all the new introductions, the prices were raised even when these were not new formulations but only changed packaging or changed brand names, it said.