The Delhi High Court on Thursday directed Johnson and Johnson to make interim payment of Rs 25 lakh each to 67 patients who have undergone revision surgeries for alleged faulty hip implants made by the company.
The court's direction came after the company said it has verified that these patients have undergone revision surgery and it was voluntarily paying them Rs 25 lakh as compensation.
Justice Vibhu Bakhru asked the company to disburse the cheques to the claimants within two weeks and listed the matter for further hearing in August 8.
The company, through senior advocate Amit Sibal, clarified that the payment should not be considered as an admission of liability or a precedent.
The court made clear that it has not examined the controversy involved and this payment will not prejudice the rights of patients from seeking any further sum of compensation from the company.
It also said that in case any other judicial forum awards a compensation higher than Rs 25 lakh to the patients, the company would pay the balance amount only.
The court further said that in case the affected patients do not succeed in their claims before any other forum, the company would not be entitled for any refund of its voluntary payment of Rs 25 lakh.
In a statement, a company spokesperson said, "We are very pleased to make compensation payments as Johnson & Johnson Private Limited volunteered to do.
The spokesperson, however, said, "We continue to believe the formula for compensation needs to be within a fully transparent and legal framework arrived at through due process."
The company is committed to providing assistance, including appropriate compensation under the law, to ASR patients in India who have undergone revision surgery, the spokesperson added.
The Central Drugs Standard Control Organisation (CDSCO) had earlier asked the company to pay Rs 65 lakh, Rs 74 lakh, Rs 1 crore and Rs 90.26 lakh respectively to four patients.
As an interim, the court had asked the company pay Rs 25 lakh to these four patients for whom CDSCO has already issued orders, after verification of their documents.
The court was hearing the company's plea challenging a press release issued by the Ministry of Health and Family Welfare asking it to pay compensation to all the affected patients, as determined by the reports of the committees formed to examine the issues relating to its faulty hip implants.
The company also challenged the orders by which it was directed to pay compensation to patients.
It contended that the Centre has no jurisdiction under the Drugs and Cosmetics Act to fix and enforce the compensation.
It said the Centre's orders fixing the compensation was based on a formula and reports by a set of expert committees and recommendations which have already been challenged by the company and are pending in the high court.
It maintained that the Drugs and Cosmetics Act does not have any provisions that provide for a formula for payment of compensation in the matters pertaining to medical devices.
In the earlier petition filed in December last year, the company sought quashing of a government's press release informing the general public about the formula worked out by an expert committee to compensate patients who received the faulty hip implants produced by the pharma major's subsidiary, DePuy Orthopaedics Inc (USA).
It has also challenged the report of the expert committee -- headed by R K Arya, Director, Sports Injury Centre -- which worked out the compensation formula.
Besides, it has sought quashing of the report of another committee -- headed by Arun Agarwal, Professor of ENT, Maulana Azad Medical College -- which was appointed by the Health Ministry for looking into the allegations of faulty hip replacement implants.
According to the Arya committee report, compensation payable to patients would be determined in terms of the disability by the faulty hip implants in relation to their age.
The pharma major had earlier told the court that as a result of the press release, people are "landing at its doorstep" for compensation and contended that the government's public announcement was made without any legal basis.
A public interest litigation (PIL), which was earlier before the Supreme Court, has alleged that "faulty" and "deadly" hip implants have been fitted into the bodies of 4,525 Indian patients.
The plea has contended that DePuy makes, sells and exports medical implants, including articular surface replacements (ASR) hip implants which have been withdrawn by the firms on their own in 2010 on the ground that they were defective.According to the PIL, the firms "illegally sold DePuy ASR Hip Implants in India from 2005 to 2006".