Crisis of Confidence in India’s Pharmaceutical Sector

Author: Neha Chauhan
The Indian pharmaceutical sector holds a significant position in the global pharmaceutical industry, ranking among the top providers of generic medicines globally. It stands as the world’s third-largest pharmaceutical industry in volume and the fourteenth-largest in value. In the previous year, Union Finance Minister Nirmala Sitharaman emphasised India’s recognition as “the global pharmacy” due to its production of high-quality medicines at affordable prices. However, recent quality and regulatory compliance obstacles have threatened India’s reputation as the “pharmacy of the world”. 
Recent news indicates that Indian cold medication sold in Iraq was discovered to contain harmful chemicals. Bloomberg shared the test results with the World Health Organization (WHO), as well as Iraqi and Indian authorities. The WHO assessed the test results, deemed them “acceptable,” and stated they would issue an alert once the Iraqi government confirmed that the tainted product was sold in their country.
In another recent investigation conducted by the WHO on contaminated cough syrups, 20 toxic medicines were flagged, originating from two countries — India and Indonesia. These adulterated drugs have been linked to nearly 300 deaths worldwide. Several privately-owned Indian companies have come under scrutiny due to a string of recent scandals. One notable case that made international headlines involved cough syrups manufactured by Maiden Pharmaceuticals in Haryana, which had a connection to the deaths of approximately 70 children in Gambia. Similarly, syrups produced by Marion Biotech in Noida were linked to the deaths of 18 children in Uzbekistan. 
In both instances, the drugs were allegedly contaminated with hazardous substances, specifically diethylene glycol and ethylene glycol, as reported by the affected countries. Furthermore, health authorities in Lebanon and Yemen also raised concerns about a cancer drug produced by Celon Labs in Hyderabad after discovering the presence of life-threatening bacteria, namely pseudomonas, in one of the batches.  It is worth noting that the US Centers for Disease Control and Prevention (CDC) has also indicated a potential connection between using an over-the-counter eye drop manufactured by a Chennai-based pharmaceutical firm and three deaths, eight cases of vision loss, and four cases of eyeball removal.
Navigating Challenges to Safeguarding India’s Pharmaceutical Integrity
Two hundred nine pharmaceutical units have come under government scrutiny for violations following the international alerts on the quality of made-in-India medicines. After conducting inspections in 76 units as part of the first phase, the Union Government has revoked the licences of 18 pharmaceutical firms citing their production of poor-quality medicines. In comparison, an additional 26 units have received show-cause notices. The cancellation of licences and the issuance of show-cause notices raise the question of how these units were allowed to operate despite the violations in the first place. Such violations call into question the effectiveness of the initial approval and monitoring processes that allowed these units to operate without adequate scrutiny. It underscores the need for a more rigorous and comprehensive regulatory framework to prevent substandard medicines from entering the market, ensuring the safety and well-being of consumers. 
The government has taken steps to prevent the shipment of adulterated and substandard cough syrups by amending the export policy. As per the notification from the Directorate General of Foreign Trade, starting from 1st June, cough syrups from India can only be exported after undergoing testing and certification by a government laboratory. Santosh Kumar Sarangi, Director General of Foreign Trade, emphasised the government’s commitment to ensuring that any cough syrup exported from India meets the minimum quality standards. While the emphasis on ensuring the quality of medicines for international markets is commendable, there needs to be a similar requirement for cough syrups sold within the country. This discrepancy in regulatory measures may inadvertently treat citizens as second-tier consumers, potentially compromising their health and raising questions about equal access to safe and reliable medications. Authorities must address this issue by implementing consistent quality control measures for all medicines, regardless of their intended destination, to uphold the well-being and rights of all citizens as equal stakeholders in the healthcare system. 
Considering the substantial quantity of cough syrups exported, implementing a compulsory testing and certification procedure can potentially introduce significant delays for manufacturers, which could disrupt their production schedules and supply chains. This could result in logistical challenges and potentially affect the competitiveness of Indian pharmaceutical companies in international markets. Authorities must strike a balance between quality assurance measures and practical considerations to support the smooth functioning of the pharmaceutical industry while upholding the standards of medication safety for global consumers. 
India’s pharmaceutical industry has 36 different regulators, allowing unscrupulous operators to exploit regulatory loopholes. The existence of multiple regulators overseeing different components of drug regulation leads to a fragmented system of supervision, resulting in potential gaps in monitoring. The lack of streamlined coordination and collaboration among regulators hampers the industry’s ability to ensure comprehensive monitoring and enforce standardised quality standards.
India’s significant role as a leading manufacturer and exporter of medical products globally underscores its importance in providing essential medicines to highly developed and low and middle-income countries. However, the absence of rigorous monitoring and testing of imported drugs in low-resource countries can have grave implications for their consumers. Additionally, regulatory agencies in other countries may become hesitant to licence or import medicines from India, potentially limiting patient access to critical pharmaceutical products and affecting the global availability of life-saving treatments. India must address these issues promptly to ensure that access to medicines, particularly for poorer countries, is not adversely affected. 
The recent controversies surrounding India’s pharmaceutical industry have highlighted the urgent need for comprehensive regulatory reforms and robust quality control measures. As a prominent global manufacturer and exporter of medical products, India plays a crucial role in supplying essential medicines, particularly to low-income countries with limited access to healthcare. These vulnerable nations already face numerous health challenges, making it necessary for India to address the flaws in its regulatory framework.
On 27th July, the Lok Sabha passed the Jan Vishwas (Amendment of Provisions) Bill 2023. Public health experts have expressed concerns over the perceived weakening of the Drugs and Cosmetics Act of 1940, as certain offences under it were decriminalised. One of the amendments in the Bill addresses the punishment for repeated violations of using a government analysis or test report for drug advertising. The previous penalty, involving imprisonment of up to two years or a fine exceeding Rs 10,000, has now been proposed to be replaced solely with a fine, but one exceeding Rs 5 lakh. 
The second amendment introduces the concept of “compounding,” allowing for a punishment of one to two years of imprisonment and a fine exceeding Rs 20,000 for drugs not of standard quality (NSQ), as defined in Section 27 (d) of the 1940 Act. Compounding is a provision that allows offenders to pay a fine instead of facing criminal proceedings. The health ministry clarified that this amendment does not decriminalise or reduce the sentence under Section 27 (d). 
Instead, it offers an alternate mechanism through compounding, which will apply only to drugs meeting specific criteria, such as not failing parameters deemed harmful to health, not containing toxic substances, not diminishing the quality or strength of a drug, not being manufactured in unsanitary conditions, not being manufactured without a licence, and not having misleading labels.
Despite the clarification, activists and experts remain sceptical, asserting that drugs listed as not of standard quality in Section 27 (d) may not be as safe as claimed and could lead to bodily harm. They argue against treating certain drugs less seriously than others, highlighting that these non-standard quality drugs pose significant risks and are a primary concern in India.
Rather than opting for compounding, the authorities must tighten and enforce the penal provisions rigorously. Strengthening best practices and ensuring adherence to high-quality manufacturing standards will bolster India’s reputation as an internationally reputed drug manufacturer.