The regulatory landscape for pharmaceutical firms has been in flux recently due to patient safety and compliance issues. Regulatory bodies have enforced strict actions, penalties, and licensing requirements to ensure standard quality is not compromised. Suresh Subramanian, National Lifesciences Leader, EY Parthenon India, sheds light on the way forward for pharmaceutical firms amidst the heightened scrutiny of their manufacturing units.

Q: How are pharma firms trying to navigate the stringent regulatory landscape of Pharma in India?

Ans: The regulatory framework governing the pharmaceutical sector in India is designed to ensure the safety and quality of medicines for citizens. This framework is primarily overseen by the Central Drugs Standard Control Organization (CDSCO) under the Ministry of Health and Family Welfare.

The Drugs and Cosmetics Act of 1940 is central to this framework, which regulates drug import, manufacture, distribution, and sale. The Drugs and Cosmetics Rules of 1945 provide detailed manufacturing standards, while CDSCO is responsible for approving new drugs, overseeing clinical trials, and issuing import licenses in collaboration with state authorities.

Indian pharmaceutical manufacturers must adhere to Good Manufacturing Practices (GMP) outlined in Schedule M to maintain product quality. The National Pharmaceutical Pricing Authority (NPPA) ensures that medications remain affordable, and the New Drugs and Clinical Trials Rules of 2019 establish a structured process for drug approvals and clinical trials. In summary, India’s regulatory framework aligns pharmaceutical practices with public health goals, making compliance essential for companies in this dynamic market.

Q: What are pharma companies doing to comply with the revised Schedule M regulations?

Ans: Indian pharmaceutical companies are actively working to align with the revised Schedule M regulations, which mandate the implementation of Good Manufacturing Practices (GMP) standards by 2025 for both large firms and SMEs. Schedule M outlines essential criteria for drug manufacturing, including the location and design of manufacturing plants, which must be situated in clean, pollution-free areas to prevent cross-contamination.

Companies must maintain modern, well-kept equipment, adhere to strict sanitation and hygiene protocols, and establish robust quality control systems with in-house laboratories for testing raw materials and final products. Adequate qualified personnel must be employed for production and quality control, and meticulous documentation of all manufacturing processes is essential.

However, challenges exist in implementing Schedule M compliance. Many small and medium-sized enterprises (SMEs) face infrastructure constraints, needing more resources to upgrade facilities and modernise equipment. There is also a need for more trained personnel in areas like quality control and regulatory affairs. Additionally, comprehensive documentation is often inadequate, raising the risk of non-compliance. The financial burden of upgrading facilities can be prohibitive for SMEs, and older manufacturing sites often need help with layout issues that increase the risk of cross-contamination.

Overall, while the industry is making strides toward compliance, these challenges must be addressed to align with Schedule M regulations and ensure high-quality pharmaceuticals fully production.

Q: What are the possible implications of the revised regulations on the pharma industry? 

Ans: India faces several significant challenges in its pharmaceutical sector. Substandard and counterfeit drugs remain a primary concern, with a 2022 government report estimating that 3-5 per cent of medicines in the market are of substandard quality, raising severe patient safety issues. Additionally, Indian pharmaceutical companies, particularly in the generic segment,

have experienced export bans and product recalls in key markets like the US and EU due to non-compliance with Good Manufacturing Practices (GMP). Regulatory authorities, including the US FDA, have highlighted problems such as data integrity issues, poor sanitation, and a lack of adherence to GMP.

Data integrity and documentation remain persistent issues, with international regulators flagging data falsification and inadequate record-keeping during inspections. Indian firms have faced penalties for failing to maintain accurate records, especially in quality control. The overproduction and overprescription of antibiotics in India are contributing to rising antimicrobial resistance (AMR), exacerbated by environmental pollution from pharmaceutical waste.

While the Central Drugs Standard Control Organization (CDSCO) sets national guidelines, enforcement varies widely across states, leading to inconsistent drug quality standards. Many state drug regulatory authorities must be more under-resourced, resulting in inadequate oversight of manufacturing facilities. The rising popularity of ayurvedic and herbal products also poses challenges, as many need to meet the stringent quality standards required for allopathic medicines.

These issues persist due to several factors: the complex regulatory environment creates confusion over differing standards for domestic and export markets; small and medium-sized enterprises (SMEs) often lack the financial and technical resources needed to meet high-quality standards; inconsistent regulatory enforcement at the state level leads to quality control issues, particularly in smaller plants, and as India expands its global pharmaceutical footprint, companies face increased scrutiny from international regulators, which enforce stricter quality standards than local regulations. Addressing these challenges is crucial for enhancing the quality and safety of pharmaceutical products in India.

Q: How do pharma companies intend to rebuild trust from regulatory bodies, the government and the public?

Ans: India's pharmaceutical regulatory framework aims to ensure the safety, efficacy, and quality of drugs, with compliance with Schedule M being critical. However, implementation challenges, particularly for small and medium-sized enterprises (SMEs), persist. The  Government of India is focused on tightening quality standards to address global regulatory concerns. Yet, gaps in enforcement, infrastructure upgrades, and the ongoing issue of substandard drugs still need to be addressed.

India must stay caught up as a major player in the global pharmaceutical market. The government needs a holistic approach to tackle these issues, demonstrating a clear roadmap to align with global standards. The notion that local quality can differ from export quality is unhelpful and risks compromising the safety of Indian citizens.

Industry bodies like the Indian Medical Association (IMA) and the Indian Drug Manufacturers’ Association (IDMA) are in discussions with the government. IMA is forming a task force to drive advocacy and awareness, while IDMA supports improving quality standards but advocates for gradual implementation, increased government funding, and flexible regulatory timelines for SMEs.

Addressing these challenges requires a comprehensive strategy that leverages technology and cross-industry collaboration. Key steps include enhancing manufacturing and packaging standards, implementing SKU traceability, strengthening regulatory oversight, and establishing rapid response mechanisms through collaboration with law enforcement. Starting small and creating an aligned roadmap with all stakeholders will be essential for effective implementation.