Pharma Not A Sector For "Cottage Industry"

India’s revised GMP norms, if enforced in earnest, could not only separate the wheat from the chaff from a manufacturing and quality compliance perspective, but could also potentially reshape the country’s production landscape for medicines, going by what some industry bigwigs say.

The CEO of an Indian firm told the Pink Sheet that in recent discussions with some other industry peers, it was estimated that of the 10,000-odd pharma manufacturing units in the country, only about a quarter or so would make the cut if the revised norms are implemented strictly. A substantial percentage of the manufacturers currently fall under the MSME (micro, small and medium enterprises) category.

There are already rumblings of plant closures in Baddi, in the state of Himachal Pradesh, known for its cluster of pharma manufacturers, though some experts say that could be due in part to the ending of tax holidays there. Last year, local media reported "stop manufacturing directions" at a number of sites in Baddi after inspections by the Indian regulator flagged up compliance deviations.

The CEO also maintained that government leadership appears firm that quality lapses that erode India’s repute in pharmaceuticals, seen as a frontline industry globally, will not be allowed to pass, even if it means a “capacity hit” in the short term.

Last year, Mansukh Mandaviya, Union Minister of Chemicals and Fertilizers, and Health and Family Welfare, underscored there will be “no compromise” with the quality of drugs manufactured in India. The minister stated at the time that in order to ensure the highest quality of pharma products, the regulator had commenced risk-based inspections and audits of plants; 137 firms had been inspected, and action taken against 105. Production had been stopped at 31 firms and cancellation and suspension of product/section licenses had been issued against 50 firms.

The new norms could also potentially cap the mushrooming of fringe manufacturers which have no real long-term “stake in anything,” as the CEO put it. Interestingly it could also indirectly deter the unhealthy practice of company executives at regional/zonal manager level turning entrepreneurial overnight by teaming up with a handful of physicians and some fringe manufacturer to enter the market, he added.

“It may become a kind of larger, long-term player industry which is good. This is not really a sector where a cottage industry that can’t meet global standards is required,” the CEO declared.

The next step, he believes, should also encompass moving to a LIMS (Laboratory Information Management System) system, which will further standardize operations by streamlining workflows, tests, and reporting procedures.

Nevertheless, the CEO and other industry experts maintain that enforcement of the revised GMP norms will determine how effective the clean-up of Indian pharma manufacturing is, though Dr Rajeev Raghuvanshi, India’s new Drugs Controller General of India, appears determined to set things right.(Also see "Quality Street: India Needs A Frances Kelsey, Many Of Her Kind" - Scrip, 7 July, 2023.)

There are already reports of lobbying and pressure from the MSME sector which claims that India could be staring at drug shortages and higher prices as the upgrade under the revised Schedule M will entail a cost component and also see plant closures.

Industry experts though referred to a number of government initiatives, including the Strengthening of Pharmaceutical Industry (SPI), scheme already underway to support MSMEs. The SPI includes three sub-schemes, including “Assistance to Pharmaceutical Industry for Common Facilities (API-CF),” which plans to provide support to pharma MSMEs clusters for strengthening infrastructure facilities, and the “Promotion of Technology Upgradation Assistance Scheme” to address the issues of technology upgradation of individual pharma MSMEs.

“The intention [of the revised GMP norms] is right but it also depends on how effectively the regulatory apparatus moves against unscrupulous players. We’ve seen unannounced inspections happen, which is good. We welcome that...all of industry should welcome that,” the CEO added.

India Sets Out Revised GMP Rules: Can It Weed Out Dodgy Players?

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