Decrease in hospital stock: September 30 was a heavy day for corporate hospitals in the stock market. Shares of major hospitals saw a sharp fall of up to 6 percent after the Supreme Court’s very harsh remarks. The court has expressed deep concern over the huge profits charged by hospitals on medicines. The court’s ire was mainly directed at the fact that patients are forced to buy medicines from the medical store of the hospital itself, due to which the common man has to suffer a lot.

Supreme Court is strict on drug prices

A bench of Justice Vikram Nath and Justice Sandeep Mehta used harsh words while hearing the cost of the drugs. The court said that corporate hospitals spare no one. The bench even said that these people are not even allowing the body to be taken out. Giving the example of cancer medicine, the court said how a drug costing Rs 2,700 is sold to patients for Rs 27,000. The court has clearly termed it as ‘genocide’.

Shares of these hospitals fell

The impact of this strict stance of the Supreme Court was immediately seen on the stock market. Shares of Apollo Hospitals, Yatharth Hospitals and Max Healthcare fell 4 to 6 percent in morning trade. While Fortis Healthcare fell by 5.2 percent, Krishna Institute of Medical Sciences (KIMS) by 3.8 percent and Aster DM by 4.2 percent. It affected the entire healthcare sector. The Nifty Pharma index was down 1 percent and the BSE Healthcare index was down 2 percent.

Suggested 16 percent margin on medicines

During the hearing, the court asked the central government why a uniform margin of 16 per cent cannot be fixed on the MRP of all drugs. The court said that there should be no distinction between essential and non-essential medicines as ultimately the loss has to be borne by the taxpayers. Solicitor General Tushar Mehta agreed with the court’s concerns and said the issue needed attention and would discuss it with the authorities.

How much will it affect profits?

According to market analysts, this may have a direct impact on the earnings of hospitals. Medicines and medical equipment account for 20 to 35 percent of the total revenue of hospitals. Nitant Darekar, research analyst at Bonanza, says that if a 16 per cent margin is imposed on drugs, the profits of pharmacy-based hospitals such as Apollo, Max, Aster DM, Medanta and Fortis may come down. Apollo may be the most affected by this as it has a large network of retail pharmacies. At the same time, the impact on clinical oriented hospitals like Narayan and Jupiter will be less. However, this is only a suggestion and no final order has come. The next hearing of the case has been fixed on 12 October 2026.