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Measures for Rationalisation, Quality Control and Growth of Drugs & Pharmaceutical Industry In India.


1.1 Health is a fundamental human right. The Constitution of India directs the State to regard the improvement of public health as among its primary duties. The Five Year Plants have been providing the framework within which the Centre and States have developed their health services infrastructure and programmes. Since the attainment of Independence considerable progress has been achieved in the promotion of health status of the people – as reflected in the eradication/control of diseases like small-pox, malaria etc., reduction in mortality rate, rise in life expectancy, creation of a fairly extensive network of health care institutions and the availability of a large stocks of medical and health personnel.

1.2 The National Health Policy of 1983 marks a significant step in the national endeavour to improve public health. It reiterates India’s commitment to the goal of “Health for all by the year 2000 A.D.” through the universal provision of comprehensive primary health care service. The attainment of this goal requires an accelerated development of all inputs to the health care system, including essential and life saving drugs and vaccines of proven quality. Drugs alone are not sufficient to provide health care. However, if rationally used, they do play an important role in protecting, maintaining and restoring the health of the people and in controlling population. The Indian Pharmaceutical Industry has, therefore, a vital role in serving the basic health needs of the people.

1.3 The Report of the Hathi Committee (1975) is an important landmark in the development of the Indian Pharmaceutical Industry. The Hathi Committee emphasized the achievement of self-sufficiency in medicines and of abundant availability at reasonable prices of essential medicines. Since 1975, the Indian Pharmaceutical Industry has grown to be the most diversified and vertically integrated pharmaceutical industry in the entire Third World. The country has achieved self-sufficiency in formulations and also in a large number of bulk drugs. In 1984-85, imports of formulations were only Rs.10.17 crores or about 0.5% of the total formulation production in the country and imports of 49 bulk drugs were negligible. Technologies for the production of several bulk drugs, including antibiotics like Ampicillin, Amoxycillin, Erythromycin, Anti-infectives like Sulphamethaxazole and Trimethoprim., anti-TB drugs like Ethambuto Cardio Vascular drugs like Methyl Dopa; Analgesics like Ibuprofen and Isopropyl antipyrine; anti – amoebics like Metronidazole and Tinidazole, anti-cancer drugs like Vinblastine, Vincristire and Cisplatin were indigenously developed. The trade balance in pharmaceuticals is also improving as a result of increasing exports. In 1984-85, exports of drugs and formulations were Rs.217.49 crores while imports were Rs.215.62 crores. A wide range of bulk drugs and formulations are being exported to several countries, including the U.S. and the West European countries. Some Indian firms have also set up production facilities in other countries and are also engaged in the sale of turnkey plants and technical services. The diverse production and technological capabilities developed by the Indian Pharmaceutical Industry are valuable assets in achieving the goals of the National Health Policy and in fully harnessing the export potential.

1.4 While these achievements are impressive by themselves, there are many areas where the industry has to reorient itself if it has to effectively serve the health needs of the people. The present production pattern does not adequately reflect the genuine requirements of the health care needs of the country. The proliferation of formulations and packs without adequate therapeutic rationale is a matter of concern. While many firms in the organized as well as small scale sector have excellent internal testing facilities and a good record of quality control and adoption of good manufacturing practices, the same cannot be said of a large number of firms manufacturing formulations. The present institutional and statutory arrangements for enforcing quality control for registration of new formulations, for monitoring adverse reactions and for dissemination of unbiased information about the safety and efficacy of products marketed in the country are far from being adequate.

1.5 Abundant availability on a continuous basis, at reasonable prices, of essential, life saving and prophylactic medicines of good quality, is the corner stone of the new measures. It shall be the endeavour of the Government to ensure that the above objective, which is in consonance with the Government’s Policy of reaching Healthcare facilities to the common masses and with that of ensuring Health for all by the year 2000 A.D., is achieved. In order to subserve this objective, changes have been brought about in the system of price control of drugs as well as in the licensing and approval procedures. Experience gained in the implementation of the Drugs (Prices Control) Order, 1979 has clearly shown that the pricing system needs to be simplified and rationalized, if the benefits of the price control are to be effectively realised by the consumer, particularly the weaker sections of the society for safeguarding whose interests the Government is committed. The span of price control at present is impracticably large covering 347 bulk drugs and over 4,000 formulations marketed in about 20,000 packs. It is proposed to reduce to a considerable extent this span of control and to make the price control system less cumbersome but more effective.

1.6 As prices of drugs are also determined by the cost effectiveness of domestic production, it is imperative to impart a technological and productivity thrust to the Indian Pharmaceutical Industry which would also enable it to harness export opportunities. The objective of ensuring abundant availability of medicines at reasonable prices, will be best served by promoting competition and economic scales of production and also by removing unnecessary barriers to growth. To this end, licensing and approval procedures have been simplified and greater flexibility given in order to those of essential and life saving drugs. The validity of this premise has already been established by the experience, in recent years, with the market prices of bulk is produced by a good number of manufacturers. At the same time, FERA companies will continue to be regulated by Government to ensure that their operations are in consonance with the national objectives and priorities.

1.7 It is against this backdrop that the Government has reviewed the functioning of the Drug Policy and now restructured the Policy in the light of the experience gained and keeping in mind the objective of achieving “Health for All by the Year 2000 A.D.”