How is India streamlining the pharma sector?

Sub: Polity

Sec: National body

Context:

India’s Central Drugs Standard Control Organisation (CDSCO) has recently taken back the authority previously granted to State licensing bodies for issuing No Objection Certificates (NOCs) for the production of unapproved, banned, or new drugs for export purposes.

Details:

This centralization of licensing authority reflects India’s efforts to maintain strict control over drug quality following international scrutiny over allegations of substandard drug exports linked to health concerns in several countries.
The CDSCO will now be the sole authority to issue manufacturing licenses for drugs intended for export, consolidating the process at the national level.

India’s pharma industry:

India’s pharmaceutical industry plays a significant role globally as the third-largest producer of pharmaceuticals by volume and 14th largest by value, catering to about 200 countries.
- 100% FDI in the Pharmaceutical sector is allowed under the automatic route for greenfield pharmaceuticals.
- 100% FDI in the pharmaceutical sector is allowed in brownfield pharmaceuticals; wherein 74% is allowed under the automatic route and thereafter through the government approval route.
Notably, India supplies 62% of the global demand for vaccines, including major vaccines like DPT, BCG, and measles, with at least 70% of the WHO’s essential immunization schedule vaccines sourced from India.
The Indian pharmaceutical industry has an estimated 10,500 companies, with drug exports having more than doubled in the past decade.
This vast production capacity and global reach make any policy change within India’s pharma sector, such as the recent centralization of NOC issuance, highly impactful.

Significance of this step:

A study by the Department of Pharmaceuticals anticipates substantial growth opportunities for India’s generic drug market between 2022 and 2030, as drugs worth $251 billion globally are expected to go off-patent, opening up new markets for Indian generics.
The centralization of NOC issuance is expected to streamline procedures, improve efficiency, and standardize protocols across India’s pharma industry, potentially enhancing the country’s pharmaceutical exports.
This move aligns with the broader goal of reaching a $450 billion target by 2047 and reinforces the central government’s role in controlling and overseeing drug exports—a function deemed necessary given the critical nature of pharmaceuticals in global health.

About CDSCO:

It is the Central Drug Authority for discharging functions assigned to the Central Government under the Drugs and Cosmetics Act of 1940.
It works under the Ministry of Health & Family Welfare the National Regulatory Authority (NRA) of India.
Under the Drugs and Cosmetics Act, CDSCO is responsible for –
- Approval of Drugs.
- Conduct Clinical Trials.
- Laying down the standards for Drugs.
- Control over the quality of imported Drugs in the country.
- Coordination of the activities of State Drug Control Organizations.
- Further CDSCO along with state regulators, is jointly responsible for the grant of licences to certain specialised categories of critical Drugs such as vaccines and sera, etc.
The Indian government has announced plans to subject all medical devices, including implants and contraception, to CDSCO scrutiny.

Drugs Controller General of India (DCGI):

DCGI is the head of the department of the CDSCO of the Government of India responsible for the approval of licences of specified categories of drugs such as blood and blood products, IV fluids, vaccines and sera in India.
DCGI also sets standards for the manufacturing, sales, import, and distribution of drugs in India.

Source: TH