520 pharmacies accuse NDA of sh110b fraud

Feb 20, 2015

A group of 520 pharmacies petition court, accusing the National Drug Authority (NDA) of defrauding them of sh110.8b in illegal license fees and other charges.


By Andante Okanya & Betty Amamukirori

KAMPALA - A group of 520 pharmacies have petitioned court, accusing the National Drug Authority (NDA) of defrauding them of sh110.8b in illegal license fees and other charges.

The claims of the pharmacies are contained in a civil suit filed on January 23 at the civil division of the High Court in Kampala.

The claim is for the period between 2008 up to March 27 last year.

The pharmacies accuse NDA of infringement of their constitutionally guaranteed rights to property, asserting that NDA is perpetuating unjust enrichment.

NDA is also accused of breach of statutory duty and obligations, with the pharmacies querying the move of the executive secretary of issuing of a new fees structure not backed by law.

"The plaintiffs contend that without an enabling legal regime, it was wrongful, unlawful and illegal to compel the plaintiff(s) through circulars/guidelines [which are not sources of law] to arbitrary pay fees outside those prescribed by the law at the time," the plaint states in part.

The representative suit was filed by Signa-Chemie Enterprises Uganda Limited through Kasirye, Byaruhanga and Company Advocates. They are demanding that court awards them damages and costs.

‘Gross conduct’

The complainants want court to compel NDA to refund the monies purportedly collected in registration fees, license fees, verification fees, retention fees, audit fees, drug registration fees and other charges.

 "The plaintiff and 519 others avers that it suffered loss by the illegal imposition of fees, assessment and  collections unlawfully exerted by the defendant being special damages as exemplified from the assorted revenues collected from it and other pharmacies/drug shops  for the years," reads the plaint.

Lawyer Denis Sembuya has explained to New Vision that his clients have suffered inconvenience, anguish, among others as a result of NDA's "manifestly gross conduct and high handedness".

On September 9, 2013, NDA’s executive secretary Gordon Sematiko issued Circular Number 001-FIN/2013 stipulating new fees structure for registration and licensing of all pharmacies countrywide.

He stated that the fees took effect on July 2013.

However, the pharmacies contend that he exercised a power not vested in him under the provisions of the said law or any other law for that purpose.

In its defense filed on February 9 – through Kateera  & Kagumire Advocates – NDA justifies its actions, stating that the fees are not illegal, and that it communicated to the pharmacies about the implementation as authorized by the line minister.

"It is further averred that the defendant was duly authorized by the minister of health and the defendants board to levy the charges in question against the plaintiff and they were duly informed of the said charges by publication in the national newspapers," NDA’s defence reads in part.

NDA increased license renewal fees to operate a retail pharmacy in Kampala Central division from sh300,000 to sh600,000.

Inspection fees and ascertaining suitability of premises was doubled from sh300,000 to sh600,000.

License to operate a drug shop in Kampala was fixed at sh120,000, drug shops in municipalities at sh75,000, and sh45,000.

The case file has been allocated to Justice Yasin Nyanzi. However, a hearing date is yet to be scheduled.
 

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