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  • Adya Garg

A Critical Analysis of the Draft Rules on Regulation of E-Pharmacies in India


Advancements in technology coupled with availability of internet services has revolutionized human lives in more ways than we can count. One of the most significant changes has taken place in the area of medical services, where the advent of E-pharmacies or online pharmacies has allowed consumers to buy medicines from the comfort of their homes. These have become increasingly popular because of the convenience offered, especially for working professionals, physically challenged persons and old aged people. In terms of cost effectiveness, due to lower infrastructural and maintenance cost, such online websites are able to offer medicines at a lesser price than the traditional brick and mortar pharmacies.[i]

Despite its several advantages, the presence of the E-pharmacy sector in the country has raised a few legitimate concerns. The online pharmacies are currently operating in a grey area of law as there is no proper regulatory framework for them. They continue to be governed by the outdated Drugs and Cosmetics Act, 1940[ii] (“Act”) and the Drugs and Cosmetic Rules, 1945[iii] (“Rules”).[iv] On directions from the Delhi and Madras High court,[v] the Ministry of Health and Family Welfare presented the Draft Rules on Sale of Drugs by E-pharmacy, 2018  (“draft rules”)[vi] in the form of an amendment to the Act, to govern E- pharmacies. The aim of this article is to analyze the effectiveness of the proposed draft rules to deal with the regulatory challenges of online pharmacy and provide innovative solutions by taking inspiration from foreign legislations.

Analysis of Risks and Potential Solutions

Online pharmacies are not free from risks and, if not regulated adequately, they might be used inappropriately. The direct impact of this will be on the health of the citizens. In this section, the author will discuss the several risks associated with the growing presence of online pharmacies and lay down prospective measures to address these challenges.

Eradication of Illegal Online Pharmacies

The draft rules define E-pharmacy as the “distribution or sale, stock, exhibit or offer for sale of drugs through a web portal or any other electronic mode”.[vii] Only those E-pharmacies that are registered with the Central Licensing Authority are allowed to operate.[viii] The draft rules are a step in the right direction but they are not sufficient to deal with the complexities involved in functioning of online pharmacies. Governments worldwide are struggling with the issue of eliminating illegal online pharmacies as these pharmacies provide substandard or banned medicines to customers in unregulated quantities, without proper prescription.[ix] It is extremely difficult to identify such websites and impose liability as they operate in a clandestine manner.

The European Union currently uses a system where every organization that is verified and registered with the competent authority is allowed to use the common logo which links to the official website listing all legally operating pharmacies.[x] This method has proved to be effective and Indian legislators should consider adopting a similar model with required modifications.

In the United States, the Verified Internet Pharmacy Practice Sites (VIPPS) is an association that monitors online pharmacies in terms of their compliance with the federal and state regulations.[xi] VIPPS accreditation allows these websites to display a unique seal, which makes it easier for the customers to verify the credentials of the E-pharmacy.[xii] In addition to this, the Food and Drug Administration is constantly involved in generating consumer awareness by publishing lists of legitimate websites and informing consumers about the ways to identify such websites.

The draft rules only provide for periodic inspection of the already registered pharmacies and cancellation of license if regulations are not followed.[xiii] The draft rules neither provide a mechanism to deal with illegitimate websites nor do they impose any liability on such websites. The policy makers must establish a dedicated agency or empower the Drugs Controller General of India to, firstly, identify and block illegal websites selling medicines and, secondly, generate consumer awareness among citizens. A clause imposing liability in the form of a fine or penal prosecution must also be included in the draft rules to deter the presence of illegal pharmacies.

Customers are often attracted to rogue pharmacies that provide prohibited drugs in unregulated quantities in lower prices. Therefore, the government should partner with domain registration companies and search engines to filter and block such websites so as to prevent their access to consumers.[xiv] Penalizing such web intermediaries that host illegal websites and providing incentives to Internet service providers who assist the government in restricting the accessibility of such websites is an effective solution to the problem of such rogue pharmacies.

Restriction on Illegitimate Prescription of Medicines

Online pharmacies are usually based on three models. First, there are traditional E-pharmacies, that provide medicines only when the customer uploads a valid prescription. The second model, requires the customers to fill a questionnaire and based on that, the physician employed by the pharmacies prescribes the medicines. Rogue pharmacies, as discussed above, are the third kind of online pharmacies that exist. These pharmacies are the most dangerous as they do not require any form of prescription from the consumers.

A valid prescription is a necessity as improper prescription or self medication can lead to drug overdose and other fatal consequences. To prevent such instances, the Ryan Haight Act[xv] of the USA, mandates a valid prescription which basically means that the doctor and patient must have at least one in-person consultation.[xvi] The regulatory authorities in the USA banned the second and third model of pharmacies because such remote consultation allows doctors hired by the pharmacists to prescribe unnecessary medicines based on a self administered questionnaire to increase their profits.[xvii]

In India, the draft rules describe a prescription as an instruction from a registered medical practitioner, which is either hand written or in electronic mode and is duly signed by the practitioner.[xviii] The draft rules require pharmacies to verify the details of the patient and the practitioner who has prescribed the medicines.[xix] Although E-prescription has been mentioned in the draft rules, the issue has not been dealt with comprehensively by the policy makers. The draft rules focus on the responsibility of online pharmacies to verify the validity of prescriptions. Such an approach is not entirely effective and there should be liability on consumers as well to not provide fake prescriptions or use the same prescription repeatedly either on the same website or different websites. Additionally, the E- pharmacies must be obligated to inform the concerned authorities with respect to any customer or doctor involved in presenting improper prescription.

To minimise the problem of illegitimate prescriptions, the policy makers must adopt the approach similar to the USA’s and allow only those E-pharmacies to function that provide medicines when a valid prescription is presented after an in-person consultation with the doctor. To facilitate this, an integrated model of telemedicine and online pharmacy can be introduced. Under such a model, the websites will be required to have a panel of registered practitioners, that are available for video consultations with the patients and based on these consultations, an E- prescription will directly be provided to the consumers. The legislators should introduce a standard format of E- prescription which is accompanied by a unique code linked to the patient’s identification in order to restrict the repetitive use of the same prescription.[xx]

A nationwide database linked to the E-prescription of the patient should be established where information like name of the patient and the prescribing authority is safely stored along with medical history of the patient. A combined effort from the government, online pharmacies, doctors and patients is required to effectively deal with the issue of illegitimate prescriptions.

Privacy of Healthcare Data

Breach of privacy and confidentiality of medical information of patients is a growing threat. On the dark web, medical information is 10 to 40 times more worthy than the financial information of a person.[xxi] Growth of online pharmacies has further aggravated this issue as users of these pharmacies are feeding personal information like name, age and medical history on these websites.

Under the draft rules, online pharmacies are obligated to abide by the provision of the Information Technology Act, 2000 (“IT Act”).[xxii] Furthermore, E- pharmacies are prohibited from disclosing any information received from the customer to another person and only for public health purposes it can be disclosed to the central or state government.[xxiii] This provision in its present form cannot be accepted as it does not define adequately in what situations the governments should be allowed access to such data. By providing such a broad ambit, the draft rules are allowing direct surveillance of the patient’s data by the government. This is inherently unconstitutional as all citizens of India have a right to privacy.[xxiv] Furthermore, the draft rules also do not mention the minimum designation of authority within the government which will have the power to order for such a disclosure.[xxv] Absence of such a precondition is in contradiction to the Aadhar judgment on privacy[xxvi] as it negatively affects the balance between privacy and security.[xxvii]

Firstly, to ensure transparency, the draft rules must require the E- pharmacies to inform the consumers of their privacy policy by displaying it on their websites. Secondly, cyber threat is one of the biggest challenges to online businesses and the draft rules must impose an obligation on websites to take appropriate cybersecurity measures to protect themselves from cyber attacks. To ensure cyber security, E-pharmacies must be required to implement secure protocols and standards for data exchange between systems, install robust firewalls which include encryption and train personnel to identify security risks and phishing attacks.

Lastly, the Digital Information Security in Healthcare Act, 2018[xxviii] (“DISHA”), which is a draft regulation introduced by the government, effectively addresses the issue of electronic health records held by hospitals, clinics and diagnostic centres. DISHA proposes to establish digital health authorities at national as well as the state level. It aims to enforce privacy and security measures for healthcare data held in electronic form along with prescribing secured storage and exchange of such data. Additionally, DISHA also talks about the issues of data collection, consent, access and rectification of digital health data and establishes  a mechanism in case of breach of these regulations. This legislation is a step in the right direction and when combined with the IT Act and the Personal Data Protection Bill, 2019[xxix] can be highly effective in ensuring the confidentiality of medical information of citizens.

Regulation of Lifestyle Drugs and Foreign Pharmacies

The government of India must be appreciated for its efforts to regulate E- pharmacies by introducing the draft rules. However, there are certain important aspects which have been completely ignored by the policy makers. Firstly, the draft rules do not provide regulations to deal with online sales of lifestyle drugs. These drugs are used to treat non medical or non health related conditions that arise due to lifestyle choices such as smoking, alcoholism or overeating.[xxx] They are commonly used for weight loss, hair growth or sexual enhancement. Such medicines do not fall within the ambit of controlled substances and in most cases, are available without providing a prescription. Although lifestyle drugs do not lead to addiction, they can still be dangerous for individuals with other health issues and therefore, regulations are needed to ensure safe and secure selling of these medications.[xxxi]

Another important aspect which deserves attention is the issue of online pharmacies operating from foreign countries. The draft rules impose a condition of localisation as all information related to the patients is mandated to remain within India.[xxxii] Such an approach is expected to affect the consumers as either due to decreased competition from foreign pharmacies, the consumers will not have access to quality medicines or the increased cost of establishing the required infrastructure will eventually lead to a rise in prices. Therefore appropriate regulations in the interest of the consumers are needed to bring these pharmacies within the ambit of national laws.

Online pharmacies operating in foreign countries are a contentious issue for a majority of the nations as it is extremely difficult to regulate these pharmacies and impose liability on them. Therefore, to effectively tackle this problem, cooperation on an international level is required with organizations like the World Health Organization and the World Trade Organization to protect individuals from illegitimate online pharmacies operating in numerous jurisdictions.


Right to Health is a fundamental right under Article 21 of the Constitution of India. Therefore, the government has a duty to ensure its citizens access to healthcare including access to medicines. E-pharmacy is a revolutionary step in providing affordable medicines in all corners of the country, especially in the post corona world, where social distancing is expected to be the new norm. The popularity of these E- pharmacies is expected to grow exponentially. Therefore, in order to adequately reap the benefits of these pharmacies, it is of utmost importance that robust regulations are implemented and consumer awareness is generated to ensure secured use of online pharmacies.


[i] Kerry Toth Rost, Policing the “Wild West” World of Internet Pharmacies, Food and Drug Law Journal, Vol. 55, No. 4 (2000), pp. 619-639.

[ii] The Drugs and Cosmetics Act (23 of 1940).

[iii] The Drugs and Cosmetics Rules, 1945.

[iv]Abhinav Saikia & Aparajita Bharti (2019, December 13), E-Pharmacy rules: Clear regulatory direction needed, Financial Express.

[v] Soabim Rocky Singh (2019, January 21), Two High Courts, two different views on online drugs sale, The Hindu.

[vi] The Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[vii] Rule 67-I (a), Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[viii] Rule 67J (1), Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[ix] Chetna Desai, Online Pharmacies: A boon or bane?, Indian J. Pharmacol., Vol. 48, No.6 (2016), pp. 615-616.

[x] Harriet Adcock (2014, June 27), New logo a badge of authenticity for online pharmacies in EU, Pharmaceutical Journal.

[xi] Supra note 1.

[xii] Cherly M. Teng (2002, April 30), Internet Pharmacies: Regulatory Problems and Potential Solutions, Harvard University DASH repository.

[xiii] Rule 67-O & Rule 67T, Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[xiv] Supra note 12.

[xv] Ryan Haight Online Pharmacy Consumer Protection Act, 2008.

[xvi] Jeff Karberg, Progress in the Challenge to Regulate Online Pharmacies, J.L. & Health, Vol.23 (2010), pp. 113-142.

[xvii] Id.

[xviii] Rule 67-I (d), Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[xix] Rule 67P (1), Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[xx] Mahnaz Samadbeik, Maryam Ahmadi, Farahnaz Sadoughi & Ali Garavand, A Comparative Review of Electronic Prescription Systems: Lessons Learned from Developed Countries, J Res Pharm Pract., Vol.6, No.1 (2017), pp. 3-11.

[xxi] Caroline Humer & Jim Finkle (2014, September 24), Your medical record is worth more to hackers than your credit card, Reuters.

[xxii] Rule 67M (1), Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[xxiii] Rule 67K, Draft Rules on Sale of Drugs by E-pharmacy, 2018.

[xxiv] Siddharth Sonkar & Ashna Ashesh (2019, May 3), India Must Carefully Navigate Regulatory Challenges Posed by E-Pharmacies, The Wire.

[xxv] Id.

[xxvi] K.S.Puttaswamy v. Union of India, (2019) 1 SCC 1.

[xxvii] Ashok Kini (2018, September 26), [Aadhaar] Read The Summary Of Majority (4:1) Judgment, Live Law.

[xxviii] Digital Information Security in Healthcare Act, 2018

[xxix] The Personal Data Protection Bill, 2019.

[xxx] S.Z. Rahman, V. Gupta, Anupama Sukhlecha, Y.Khunte, Lifestyle Drugs: Concept and Impact on Society, Indian J Pharma Sci., Vol 72, No.4( 2010), pp. 409-413.

[xxxi] Supra note 12.

[xxxii] Rule 67K , Draft Rules on Sale of Drugs by E-pharmacy, 2018; Siddharth Sonkar & Ashna Ashesh (2019, May 3), India Must Carefully Navigate Regulatory Challenges Posed by E-Pharmacies, The Wire.

Authored by Adya Garg, a student of National Law University, Jodhpur. This blog is part of the RSRR Blog Series on Digital Healthcare in India, in collaboration with Nishith Desai Associates.


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