Implementing revised Schedule M rules uphill task for small pharma

Analysts also feel this move will help improve quality of Indian drugs

A notification of the revised Schedule M rules by the Ministry of Health and Family Welfare has elicited mixed responses from the pharma sector and industry observers.

While the industry has welcomed the revision of rules, several analysts said that implementation and compliance can become a challenge for smaller pharmaceutical companies. 

The Schedule M of the Drugs and Cosmetics Rules specifies the good manufacturing practices (GMPs), which aim to ensure the quality of drugs made in the country.

The revised GMP rules come after several international incidents came to light, where Indian cough syrups and eye drops were allegedly found to be spurious and contaminated.  

Speaking on the need for GMP reforms, Nikkhil K Masurkar, chief executive officer (CEO), Entod Pharmaceuticals, said upgrading GMP norms will bring the industry on par with global standards.

It will improve the quality standards of drug products and help India promote itself as the global manufacturing hub for generic medicines. “Currently, there are around 10,500 drug manufacturing units in India. Of these, only 2,000 units comply with World Health Organisation’s GMP guidelines in India. This makes such an amendment necessary. But implementation of the revised norms should be done gradually, through a transition period in order to allow the industry to better prepare and plan,” he added. 

Analysts, however, flagged the difficulties that micro, small and medium enterprises (MSME’s) may face in implementation and compliance with the revised rules. 

Nirali Shah, analyst at the Ashika Group, said implementing the revised GMP guidelines may be quite challenging for MSMEs as this would demand a hefty investment for infrastructure upgrades.

“Compliance cost increases production expense, which may present a competitive disadvantage for small players,” she said.

Terming these problems as short-term challenges, Shah said that adherence to these norms is essential as we saw multiple cases of drug recalls and contamination complaints last year. Some of them were even highlighted by the World Health Organization (WHO).

“The bottom line remains that the industry needs to balance these hurdles while ensuring compliance, as it is important for the long-term reputation of the country,” she added.

The Central Drug Standards and Control Organisation (CDSCO), along with state drug inspectors, has been carrying out inspections throughout last year as part of a nationwide crackdown on spurious and substandard drugs.

The notification of the revised rules directs all companies to implement them within six months to a year, based on the company’s turnover. 

Large companies, which have an annual turnover of over Rs 250 crore, will have to implement the guidelines within the next six months.

Medium and small manufacturers, with an annual turnover of less than Rs 250 crore will have to implement the revised rules within a year.