International Tax Panorama

Epharmacy Pharmallama who received funding from multiple investors on TV show Shark Tank India is in legal trouble.

Delhi-based South Chemists and Distributors Association (SCDA), an association of pharmaceutical distributors has warned the startup and all investors of legal consequences for repacking drugs without obtaining license.

This way Pharmallallma is operating in contraventions of multiple provisions of Drugs & Cosmetics Act 1940, Drugs & Cosmetics Rules 1945, as well as the Pharmacy Practice Regulation.

There is no rule under which repacking of medicines without original container/packing is allowed, dose wise or otherwise under the Drugs & Cosmetics Act and will amount to the drugs being misbranded, adulterated or spurious.

In a letter addressed to the founders of the startup and the Health Ministry, SCDA alleged that Pharmallama’s operations are illegal and should be immediately shut down in public interest

The SCDA claimed that running an epharmacy is against Indian laws.

About Pharmallama:

Founded in 2020 by Deepesh Rajpal, Achintya Dayal and Arjun Raghunandan, Pharmallama operates a ‘full-servicing pharmacy and comprehensive medication management platform’ that dispatches medication to users in pre-sorted sachets. Each of the sachets is printed with dosage and timing of the medication to simplify management of medicines. 

The startup recently bagged an investment of INR 2 Cr for 5% equity from all five sharks – Anupam Mittal, Aman Gupta,Namita Thapar, Peyush Bansal and Amit Jain – on the reality show.

Also Flipkart is in advanced stage of talks to acquihire the Bengaluru-based online pharmacy.

Despite the troubles, the homegrown digital pharmacy market continues to grow and is projected to reach a market size of INR 8,947 Cr by 2027.