It's important to remember that reviews are superficial, and passing review is not at all the same as being compliant with the terms. Compliance is the burden of the submitter.
Now, that app store monopoly makes terms unfair and arbitrary is another discussion entirely.
They start with the premise of culpability of a name. Which _is_ the problem in the first place.
That culpability was not demonstrated but was simply declared by remote association. The same arbitrary judgement can be made for an innumerable list of other words without making that judgement neither correct nor just.
The name isn't related to the functionality, but that's not what is claimed. This restriction on drug references is spelled out in the terms, making it valid and non-arbitrary.
That the terms themselves aren't "just" is a different matter altogether, but there is no argument for it but being valid.