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Antibiotic (Free Lancer)     10 March 2015

Pharma contract

I want to discuss and take a suggestion. I started my pharma business. I am getting my own medicines/brands manufactured by a company in Chandigarh, which has its manufacturing unit in Himachal and Haryana. They will manufacture, pack (in selected quality packing-paper, design, color, font & size) and dispatch goods after balance payment. I found that almost all the companies involved in such business are not working on contracts/agreement. its a verbal practice. I want to avoid complications and have prepared an agreement myself.

I finalized everything with this company (COMPANY-A) as there prices are suitable. Few days back I came to know that they will get my order manufactured by COMPANY-B. Kind of outsourcing...which I am comfortable with. I will be signing the contract with COMPANY-A, paying the cost to COMPANY-A.

* As per Drug Act on the manufactured products it is written "Manufactured by ABC pharma" and "Manufactured for XYZ pharma"


Now the actual manufacturer (COMPANY-B) has not done agreement with me.

COMPANY-A has done agreement but has not manufactured my products.Plz let me know how to do an agreement? Shall I add something in the agreement to safeguard my interests?



Learning

 8 Replies

Kappil Cchandna (Expert Bail & Criminal Defence Lawyer at Delhi Supreme Court of India)     10 March 2015

Sir,

 

You cannot add something to get your agreement enforced between 2 and 3 party, but as a matter of abundant precaution you can add that any problem between 2 and 3 party or something like that shall have nothing to do with and your contract is with 2nd party .... So that in future the 2nd party cannot defence that you were are of the presence of the 3rd party and all...

 

Make is a simple contract between you and 2nd party .... Don't make it three party contract but you can mention that your dealing with would be with the second party .....

 

Regards

Kapil Chandna

9899011450

Kumar Doab (FIN)     10 March 2015

You can add as many clauses if these are acceptable to Company A.

Suneet Gupta (www.vashiadvocates.com)     11 March 2015

Dear Sir, it will be better for you to try and sign the contract directly with the manufacturer, with company A as the Intermediary / Consultant.

This way you will be able to save yourself if there is any manufacturing defect and keep closer tabs on the manufacturing process and final drug quality.

Antibiotic (Free Lancer)     11 March 2015

Thanks for all of your's valuable inputs. It seems that even if Company-A outsources it to someone (Company-B), they (Company-A) are bound by the agreement and they should cater all which is covered in agreement. Even if something goes wrong in manufacturing, packing  & delivery Company-A is responsible. Also it's Company-A's responsibility to get everything done.

We have mentioned that "Disputes if any shall be adjudicated under jurisdiction of Amritsar Courts only." 1. Should I register the agreement in Amritsar? 2. If I register the agreement in chandigarh (company-A's city) and file a case in Amritsar (when required), Will there be any problem/contradiction? Will I have to file the case in Chandigarh (since agreement is registered in Chandigarh) even after writing "Disputes if any shall be adjudicated under jurisdiction of Amritsar Courts only."

Suneet Gupta (www.vashiadvocates.com)     11 March 2015

It is advisable to register the Contract at Amritsar, if you want the territorial jurisdiction of Amritsar Courts to apply. Normally, the jurisdiction of the Courts where the Contract is executed (signed) is applicable and the contract can ordinarily be registered only in the place where it is executed.

The parties by contract or mutual agreement cannot waive off the natural law and change the territorial jurisdiction (unless you put in an Arbitration Clause, which is specifically provided for under The Indian Arbitration Act).

T. Kalaiselvan, Advocate (Advocate)     12 March 2015

The agreement can be registered in Chandigarh also, there is no  legal infirmity in it. Disputes in the later stage will be within Amritsar.

Sunil S Nair (lawyer)     14 March 2015

It is advised to show your Agreement pertaining to Manufacturing to legal person in case you have dought that it is missing something 

Antibiotic (Free Lancer)     15 March 2015

I showed it to an advocate in my city who said that as per contract act even If I do not register and only Notarize, the agreement will carry/hold legal value and the court will recognize it. How correct is it.


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