Pharma sector in India


01:14 PM

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What’s in today’s article?

  • Why in News?
  • The pharmaceutical industry in India
  • Notable achievements
  • Industry scenario
  • Centralization of the licensing authority
  • Steps taken to ensure the quality of manufacturing

Why in News?

  • India’s drug regulator, the Central Drugs Standard Control Organisation (CDSCO), has taken back the authority given to State licensing authorities to issue no objection certificates (NOCs) for making unapproved, banned, or new drugs for export.
  • This change comes as India faces criticism for providing low-quality drugs to other countries. Now, CDSCO alone can give manufacturing licenses for drugs intended for export.

The pharmaceutical industry in India

Notable achievements

  • The Indian pharmaceutical industry, often referred to as ‘the pharmacy of the world’, contributes immensely to global public health and promoting universal healthcare access.
  • India ranks 3rd worldwide for production by volume and 14th by value.
  • India is the largest provider of generic medicines globally, occupying a 20% share in global supply by volume.
    • The pharmaceutical industry in India offers 60,000 generic brands across 60 therapeutic categories.
  • It is the leading vaccine manufacturer globally. 62% of the world’s vaccines comes from India.
    • At least 70% of WHO’s vaccines (as per the essential immunisation schedule) are sourced from India.

Industry scenario

  • Foreign Direct Investment (FDI)
    • 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.
  • Market Size
    • The pharmaceutical industry in India is valued at $50 bn in 2022-23 and exports accounting for 50% of the production.
      • It is expected to reach $65 bn by 2024 and to $130 bn by 2030.
  • Export
    • India is a major exporter of Pharmaceuticals, with over 200+ countries served by Indian pharma exports.
    • India supplies over 50% of Africa’s requirement for generics, ~40% of generic demand in the US and ~25% of all medicine in the UK.
    • For the period 2021-22, export of drugs and pharma products stood at $24.6 bn compared to $24.44 bn as of 2020-21.
    • The Indian pharma industry witnessed exponential growth of 103% during 2014-22 from $11.6 bn to $24.6 bn.

Centralization of the licensing authority

  • About
    • CDSCO has taken back the authority from state licensing authorities to issue no objection certificates (NOCs) for exporting unapproved, banned, or new drugs.
      • In 2018, the CDSCO had permitted State and UTs’ drug licensing authorities to grant permissions to export some specific drugs.
    • The head of the CDSCO zonal office will now grant NOCs.
    • Manufacturers must obtain NOCs online through the Sugam Portal before getting a manufacturing license from the State Licensing Authorities.
  • Impact
    • The centralising of the licensing authority is significant because India needs to get ready to take advantage of drug sales worth $251 billion going off-patent this coming decade.
      • According to a study conducted by the Department of Pharmaceuticals, in the years between 2022 and 2030 several drugs are expected to go off-patent.
      • Expiry of patents is very promising for the Indian generic drug market as it is expected to expand and grow further with inclusion of these new drugs.
    • Hence, the move is welcome as the centralization of NOCs will formalize the Indian pharma industry.
      • This will result in the efficiency of the overall process along with bolstering pharma exports to key international markets.
      • It will help to bring uniformity in protocols, achieve the target of reaching $450 billion by 2047.
    • Also, it was noted that getting NOCs from local drug regulators for pharmaceutical products is a tedious process, leading to delays.
  • Challenges
    • India is dealing with several challenges, including tackling intellectual property rights, lack of research and development etc.
    • Understanding the political, economic, sociocultural, technological, environmental, and legal factors is vital for assessing the opportunities and challenges in the pharmaceutical market in India.

Steps taken to ensure the quality of manufacturing

  • Crack down by Indian Govt
    • Indian government had taken steps on 18 drug companies for poor quality manufacturing.
    • It had cancelled the licences of over 10 pharmaceutical companies as part of a crackdown on poor quality manufacturing.
    • The government is also understood to have given notices to a further 26 companies for not complying with good manufacturing processes.
  • Vision Pharma 2047
    • Make India a global leader in the manufacturing of affordable, innovative & quality pharmaceuticals & medical devices for the goal of Vasudhaiva Kutumbakam.
  • National Pharmaceutical Policy (2023)
    • The policy is being drafted to serve as a comprehensive framework to address the challenges faced by Indian Pharmaceutical industries.
    • The draft policy encompasses five key pillars:
      • Fostering Global Pharmaceutical Leadership, Promoting Self-Reliance, Advancing Health Equity and accessibility, Enhancing Regulatory Efficiency in the Indian Pharmaceutical Sector and Attracting investments.

Q.1. What is Central Drugs Standard Control Organization (CDSCO)?

The Central Drugs Standard Control Organization (CDSCO) is India's national drug regulatory agency. It is responsible for regulating and ensuring the quality of pharmaceuticals, medical devices, and cosmetics. CDSCO is under the Ministry of Health and Family Welfare, Government of India.

Q.2. What are generic medicines?

Generic medicines are additional brands of existing medicines that contain the same active ingredient and are bioequivalent to the brand-name drug. Generic medicines are manufactured under the same strict standards as brand-name medicines and have the same dosage form, strength, route of administration, and quality.

Source: How is India streamlining the pharma sector? | Explained


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