Administrator, Cape v Raats Röntgen and Vermeulen (Pty) Ltd

• Jurisdiction: South Africa
• Judge: Botha JA, Hefer JA, Nestadt JA, Van Den Heever AJA and Kriegler AJA
• Court: Appellate Division
• Year: 1992
• Citation: 1992 (1) SA 245 (A)

Administrator, Cape v Raats Röntgen and Vermeulen (Pty) Ltd
1992 (1) SA 245 (A)

1992 (1) SA p245

Citation	1992 (1) SA 245 (A)
Court	Appellate Division
Judge	Botha JA, Hefer JA, Nestadt JA, Van Den Heever AJA and Kriegler AJA
Heard	August 26, 1991
Judgment	September 27, 1991

Flynote : Sleutelwoorde

Medicine — Medicines and Related Substances Control Act 101 of 1965 and general regulations promulgated thereunder — Provincial administration G proposing scheme whereby medicines registered under Act prepacked into standard dosages and distributed to district pharmacists, to be issued to district surgeons' patients in rural areas as and when prescribed — Purpose of such scheme to reduce costs of existing rural scheme — Whether such scheme contravening provisions of Act and regulations — H Section 14(1) prohibiting sale of medicine subject to registration which is not registered — Regulation 9(1) providing for details required to appear on immediate container of every medicine sold — Regulation 9(4)(c) providing that reg 9(1) not applicable to medicine sold by pharmacist or hospital in accordance with prescription issued by medical I practitioner for treatment of particular patient — Regulation 10(1) providing for information required to appear on package inserts to accompany all registered medicines sold — Regulation 10(3)(c) in similar terms to reg 9(4)(c) — Regulation 12(1) requiring every medicine sold to comply with standards and specifications furnished to J and accepted by

1992 (1) SA p246

A Medicines Control Council (in application for registration of medicine) — Respondent arguing that transmission of bulk supplies of prepacked medicines to district pharmacists would contravene s 14, read with regs 9, 10 and 12 — Court on appeal holding that, despite wide definition of 'sell' in Act, common denominator related to some transaction of B commercial or quasi-commercial nature related to selling with view to consumption - Role of district pharmacist in proposed scheme tantamount to that of skilled storeman in control of Administration's stock — Pharmacist to part with stock only when instructed to do so by district surgeon's issuing prescription — Nothing in draft contract between C Administration and district pharmacist suggesting that supply, transmission or delivery of stock to district pharmacist partaking of nature of 'sale' as defined — Scheme not contravening reg 9(1) or 10(1) as regs 9(1) and 10(1) applicable only to 'sale' as defined — D Regulation 12 requiring that medicine, and medicine alone, comply with standards and specifications — Proposed scheme thus not contravening reg 12 — Scheme declared lawful.

State — Statutes — When binding on State — Whether State bound by provisions of Medicines and Related Substances Control Act 101 of 1965 E and general regulations promulgated, thereunder — Question to be answered is whether attainment of objectives of Act would be frustrated if State not bound by Act — Objectives of Act, being tight control over quality, manufacture, and distribution of medicines, not frustrated if State, the watch-dog exercising such control, not subject to Act — Unlikely that Legislature intended that Executive, its appointee to F oversee and enforce Act, should be subject to its own enforcement.

Provincial government — Provincial administration — Whether provincial administration bound by provisions of Medicines and Related Substances Control Act 101 of 1965 and general regulations promulgated thereunder G — Provincial administration part of Executive branch of State — Establishment, maintenance and management of hospital services important function of administration — Provincial administration an important component of State's public health establishment — Executive not subject to provisions of Act and regulations — No cogent evidence in language of Act, its objects, structure or pattern that Legislature H intending that provincial administration to be dealt with on different basis to that applicable to central Executive — Provincial administration thus not bound by Act and regulations.

Headnote : Kopnota

The Cape Provincial Administration (represented by the appellant) had proposed a scheme whereby medicines, prepackaged into standard dosages I at one of the three major Cape provincial hospitals, would be dispatched to pharmacists appointed as district pharmacists, to be issued to district surgeons' patients in rural areas as and when prescribed. The proposed scheme was a modification of one already in force at the provincial hospitals, and it was estimated that the annual costs of the existing rural system which the proposed scheme was to replace would thereby be reduced from some R40 million to below R20 million. The respondent, which operated a number of pharmacies in Boland towns, J challenged the legality of

1992 (1) SA p247

A the proposed scheme on the grounds that it contravened s 29(b) read with s 14(1) of the Medicines and Related Substances Control Act 101 of 1965 in that in all cases in which medicines required to be registered in terms of the Act were, in terms of the proposed scheme, repackaged and distributed, such medicines would be rendered unregistered and/or that it contravened reg 36(1), (2) and (3) read with regs 9, 10 and 12 of the general regulations promulgated under the Act as the proposed B repackaging and distribution would constitute deviations from the standards and specifications approved by the Medicines Control Council when it had granted registration. A Provincial Division found that the proposed scheme would contravene reg 12 of the General Regulations and, having found that the Act and regulations bound the appellant, declared the scheme unlawful.

In terms of s 14(1) of the Act, 'no person shall sell any medicine which is subject to registration . . . unless it is registered'. Regulation 9(1) detailed 24 requirements which have to appear on the immediate C container of every medicine sold, but reg 9(4) provides that the requirements of subreg (1) shall not necessarily apply to, inter alia, '(c) any medicine sold by a pharmacist or by a hospital in accordance with a prescription issued by a medical practitioner . . . for the treatment of a particular patient'. Regulation 10 detailed 18 categories of information which have to appear on the package inserts which should accompany all registered medicines sold. Regulation 10(3)(c) provides D for an exception to the rule and is couched in identical terms to reg 9(4)(c). Finally, reg 12(1) provided that '(e)very medicine sold shall comply with the standards and specifications which were furnished to the council on the form prescribed by reg 15 and which have been accepted with regard to such medicine'.

On appeal, the respondent attacked the proposed scheme on a different basis to that used in the Court a quo. It was argued that, even if it were assumed that the scheme would not contravene reg 12(1) and that the E issuing of prepackaged prescriptions to patients by pharmacists would not contravene regs 9 and 10, the transmission of bulk supplies of prepackaged medicines to district pharmacists would not be covered by the 'saving' provisions of regs 9(4)(c) and 10(3)(c). It was argued that such transmission would amount to a 'sale' within the broad meaning of 'sell' as defined in s 1 of the Act and that, while being a 'sale' by a hospital for the treatment of a patient, the individual packages of F prepackaged medicine would not have been 'sold' 'in accordance with a prescription', nor 'for the treatment of a particular patient'. It was contended that such procedure inevitably would entail prepacked medicines being transmitted, conveyed or delivered for sale without the requisite label or insert.

Held, that, notwithstanding the wide definition of 'sell' in the Act, and the ostensibly diverse range of acts enumerated in the definition, there was an identifiable common denominator characterising the whole, G namely some transaction or action of a commercial or quasi-commercial nature related, albeit remotely, to selling - or delivery pursuant thereto - with a view to consumption.

Held, further, that an examination of the terms of the proposed contract between the district pharmacist and the appellant indicated that the position of the pharmacist would be tantamount to that of a skilled storeman in control of the Administration's stock: he would have to look H after it and periodically account to the Administration for his stewardship; and he would be able to part with it only as and when instructed to do so by the local district surgeon by means of a particular form of prescription.

Held, further, that there was nothing in the draft contract to suggest that the supply, transmission or delivery by the administration to its duly appointed district representative partook of the nature of a 'sale' within the meaning of the term as defined in the Act.

Held, further, that it was clear that s 14(1) of the Act, which I proscribed the selling of unregistered medicines which ought to be registered, did not apply to the type of conduct under discussion.

Held, accordingly, that the supply by the Administration to district pharmacists of prepacked medicines did not fall within the ambit of the word 'sell' as defined in s 1 of the Act; nor did it constitute a contravention of either reg 9(1) or reg 10(1), which regulations struck J only at 'sale' as defined.

1992 (1) SA p248

A Held, further, as to whether the proposed scheme would contravene reg 12(1), that the wording of reg 12(1) was plain: it was that every medicine had to comply with the accepted standards and specifications; it was directed at the characteristics of the medicine, and of the medicine alone.

Held, further, that to read reg 12 as introducing a reference to containers, package inserts or the...