New Drugs Bill is a Wolf in a Sheep’s Clothing

New Drugs Bill is a Wolf in a Sheep’s Clothing

Instead of increasing punishments for pharma companies, they are reducing them, and there will be long-term public health consequences if pharmaceutical companies do not have the right incentives under the law to produce the highest quality medicine, says Prashant Reddy, advocate and author of “The Truth Pill.”

Prescription drugs | Photo courtesy: Pexels

Drug regulation in India has been a mythical fairytale, and there’s no hope for a robust system. In July 2022, the Union Ministry for Health & Family Welfare delivered a draft of the Drugs, Medical Devices and Cosmetics Bill 2022 with a point of supplanting and modernising the outdated Drugs and Cosmetics Act of 1940, but instead, it ended up replicating the same law, with even more dangerous provisions. The new drugs Bill has faced criticism for its pro-pharma industry approach. What is even more interesting is that one of the senior bureaucrats in the drafting committee of this Bill was arrested on charges of corruption. 

Decriminalising Offences by Pharma 

It appears that the government has been very accommodating to the pharmaceutical industry’s demand to “decriminalise” some of the existing law’s “offences”. The Bill establishes a new category of offences under Section 56(e), which pertains to the production or distribution of misbranded medications, which are technically known as NSQ “not of standard quality”, the defects of which are listed in the Fourth Schedule. Section 56(e) attracts one of the lowest punishments possible under the Act for a manufacturing-related offence. It calls for imprisonment of up to one year and a fine of at least two lakh rupees. Hence, Section 56(e) of the new Bill proposes reducing penalties for drugs that have been declared NSQ (Non-Standard Quality) due to any of the 43 defects listed in the Bill’s Fourth Schedule. 

These 43 defects act as exceptions for the Pharma violating quality standards. There is no scientific explanation for the inclusion of the 43 defects in the Fourth Schedule. Manufacturers are liable for one-year imprisonment and a fine of rupees two lakhs for such defects, whereas for defects that do not fall within the Fourth Schedule, the manufacturer is liable for a higher punishment of up to two years imprisonment and a fine of rupees five lakhs.

Shreya Shrivastava, a senior resident fellow with Vidhi Centre for Legal Policy and an expert in healthcare and pharmaceutical regulation explains, “The idea of adding this provision comes from a very strong lobby of the pharmaceutical industry. If you see, there has been a demand for decriminalisation generally across a range of legislations, but when it comes to drug regulation, it has to be done more sensibly and with a more public health-centric approach.”

The Fourth Schedule also lists “heavy metals” and “particulate contamination/foreign matter” as additional defects. So, even if a medicine is proven to be tainted with heavy metals, fungus, or glass particles, the pharma involved will receive a reduced sentence or not be imprisoned at all. Criminalising such offences was done to ensure that the quality issues do not impact the larger public health. However, the new law attacks its very foundation. Section 71 allows for the compounding (settlement) of a class of offences, including those defects listed in the Fourth Schedule, whereby the pharmaceutical company can be let off the hook if it agrees to pay a fine. Another shocking loophole relates to the power delegated to officers under the Drug Controller General of India or the state departments to compound such offences.

Covid vaccine and drugs | Photo courtesy: Pexels

Prashant Reddy, advocate and author of the book “The Truth Pill”, explains that “Prison time is no longer on the books for certain offences related to drug quality. It reduces the deterrent value of the law, which means that manufacturers are more likely to commit such offences. The kind of defects that are being allowed, which are compoundable under Section 71, will have long-term public health consequences. For example, the cut-off is at 70% of the active ingredient in the drug, and if a doctor is prescribing a 100 mg tablet of antibiotics for ten days, it can be reasonably assumed that you will get around 1000 mg of the antibiotic in your body over the course of the treatment. However, now it turns out that the drug has only 70 mg, which means you are going to get only 700 mg of the drug in your system, which not only may not resolve the infection but may also give rise to new bacteria, which is resistant to antibiotics, and that is the bigger public health threat in India currently”.

He further adds: “If I cause harm, injury, or grievous hurt to any person, I am automatically liable under the IPC, and I can go to jail. Why should pharmaceutical companies be held to a different standard? They are clearly using this rhetoric of decriminalisation to get out of serious liability.”

Shrivastava, while sharing insights on Section 71, tells The Probe, “Section 71 creates a bigger problem for public health because this way they are allowing bureaucrats and officers to completely do away with the trial. Drugs are declared of standard quality based on the standards prescribed by the Indian Pharmacopoeia Commission (IPC), and the whole idea of having a uniform standard across India for all drugs prescribed by a specialised body carries a certain value. This is the trend that is followed globally in other jurisdictions as well. But when it comes to India, they seem to bypass the standards prescribed by the Indian Pharmacopoeia by means of Section 71.”

It is seen that the standard punishment given in a lot of states, even when a company pleads guilty or is found guilty after a trial of manufacturing substandard medicine, is simple imprisonment till the rising of the court, which means the guilty is simply detained in the courtroom till the proceedings conclude. Prashant Reddy explains, “Despite the law prescribing ‘minimum one-year imprisonment’ unless there are ‘special’ reasons, we have noticed a pattern that in almost all these states where it was found that they were giving only simple imprisonment till the rising of the court on very suspicious grounds. The judge would often say that since this case has gone on for so long, we do not want to punish this fellow even further or that the accused has family or employees who depend on him. These are all standard reasons, not ‘special’ reasons. So, the law is already very lenient in the way it is implemented. If you make it even more lenient in how it is drafted, god knows how the courts will make it even more lenient in enforcing it”.

Indian Pharmacopoeia Commission (IPC) | Photo courtesy: Indian Pharmacopoeia Commission | Facebook

Drug Regulation Framework

India’s lax drug regulation framework was exposed when nine children in Udhampur, Jammu & Kashmir, died after they consumed a cough syrup that contained a poisonous compound called Diethylene Glycol. Recently, the World Health Organisation issued an alert for cough syrups manufactured by an Indian pharmaceutical company which was linked to the death of 66 children from diethylene glycol poisoning in The Gambia.

So how were these drugs passed, and what does the new Bill propose?

The answer may lie in the history of the law. Drug regulation in India has a fundamental problem in its fragmented nature of the regulatory structure, which is divided between the centre and the states. This came from the colonial nature of the Drugs and Cosmetics Act enacted in 1940. Since the Constitution was not in place and drugs were not a separate entry under the concurrent list, this Bill came under the legislative entry of public health, which was under the provinces at the time. The problem here is that even after the Constitution was enacted, drugs were added as a separate entry under the concurrent list. The government continued to follow the same structure where the provinces (and now states) were given the regulation of domestically manufactured drugs. One of the major parts is the issuance of licences for manufacturing and sale.

Shreya Shrivastava explains, “We need uniformity in drug regulation because, for example, if a drug is manufactured in Himachal Pradesh, it can be marketed all over India. Generally, the drug regulator in Maharashtra is thought of as very strict when it comes to these approvals, but the drug regulator in Himachal Pradesh is not. Allegedly they do not follow basic safeguards. However, ultimately it makes no difference because the drug manufactured in Himachal can easily enter the markets in Maharashtra. This is one of the major problems when it comes to licensing powers resting with the states, and the states have the incentive to not follow strict procedures to attract pharmaceutical investments. Some of the states are pharmaceutical hubs. One such is Himachal Pradesh, and the regulator there is allegedly lenient about these processes”.

She further adds, “Several legislative attempts were made to transfer the ‘issuance of licence’ power to the centre to create a basic uniformity for regulation, but due to extensive lobbying by states and pharmaceutical companies, such attempts have met a dead end. There were high hopes that with the new Bill, the centralisation of licensing with an independent regulator may become a reality, but that did not happen.”

The state regulators do the majority of the licensing and manufacturing licensing for drugs. Prashant Reddy explains, “The central drug regulator can approve the new drugs. For example, if paracetamol is being introduced in the market today and it has never been sold in India before, then the central regulator can approve it. Only the central regulator can approve it for sale in India. Hence, whoever wants permission to manufacture it for the next four years has to go to the central regulator. After that, from the fifth year onwards, the pharma company must go to the state drug controller. Now because we have 37 different state and union territory regulators, they are all enforcing the law in their own way. There is no consistency in how they are enforcing it. There are also a lot of jurisdictional issues between different states. For example, if one state detects a drug that is failing a quality test, it continues to be sold in other states. Since 1954 there has been a recommendation on the table to centralise all licensing functions with the central regulator. However, it has not been done.”

Office of the Central Drugs Standard Control Organisation (CDSCO), Delhi | Photo courtesy: Special arrangement

The Bill completely fails to address this gap. Drug regulation in India is disorganised due to the fact that it is overseen by numerous regulators, including the Central Drugs Standard Control Organisation (CDSCO), a non-statutory authority housed under the Directorate General of Health Services, MoHFW, and thirty-two state drug regulators housed under their respective state health departments. This contrasts with other contemporary regulatory models, such as the Food Safety and Standards Authority of India (FSSAI) or the Telecom Regulatory Authority of India (TRAI).

The WHO multi-country Study on Effective Drug Regulation found that fragmentation and uncoordinated delegation typically hamper regulatory effectiveness when drug regulatory duties are delegated to two or more bodies at the same or different levels of government.

Independence of the Regulator

The Central Drugs Standard Control Organisation (CDSCO) is just an agency of the central government and does not have any independence or autonomy. The state regulators are established within the health department of various states, and there is no coordination or supervision over the state regulators of the central regulator. The departments are hence working independently, without any coordination, towards their own pharmaceutical interests or for investment in states.

Prashant Reddy explains, “CDSCO is a department within the Directorate General of Health Services, which itself is a department within the Ministry of Health. Hence, there are multiple layers of red tape. And the DCGI functionally has very little power to do anything because all the major decisions are taken either by the Joint Secretary in charge of drug regulation or the DGHS. We ask for a more independent administrative structure. For example, like all modern-day post-liberalization regulators, they all have their own independent corporate existence through a statute that gives them basically a lot more power. The head of the regulator has a lot more power in framing rules and regulations, along with administrative flexibility. That is the kind of independence we ask for. So that they are more flexible from an administrative viewpoint.”

In accordance with the World Health Organisation’s recommendations on regulating pharmaceutical goods, most industrialised nations have a specific statutory regulator for pharmaceuticals and medical devices that enjoys some degree of independence from the government.

India’s Covid-19 vaccine | Photo courtesy: Pexels

Emergency Approval

During the pandemic, one of the most important findings regarding India’s drug regulatory system was that it had no idea how to approve new medications. The Drug Controller General of India was approving new drugs under dubious phrases such as “emergency use authorisation” and “clinical trial mode”. However, these phrases find no place in the existing Act.

The insertion of a significant clause about the exclusion of the need for clinical data in emergency situations provides the Drug Controller General of India unrestricted authority to approve such permits. In this regard, the COVID-19 pandemic exposed a clear gap. The New Medications and Clinical Trials Rules, 2019, provide for fast approval of drugs under specific circumstances, without any constraints governing their administration post-approval. The CDSCO relied on this improvised framework for approving new drugs, including vaccines. These approvals created new terminology that was not included in the statute. The CDSCO provided them with new medications and vaccines in a dubious way. This Bill completely blows the opportunity to create a comprehensive framework on this, compared to what is done in the US.

A precise framework for the authorisation of medications for emergency use must be included in the Bill along with clear guidelines in the legislation to direct emergency medication approvals by the CDSCO.

Shrivastava criticises the new drugs Bill as insufficient “The new drugs Bill does not change and continues to maintain the status quo regarding drug regulation. The most problematic aspect of it is the drug regulatory architecture which continues to be fragmented between the centre and the states. The drug regulator has no independence or autonomy. No transparency or accountability of the drug regulators is ensured under this Bill because of the reasons that it does not establish an independent statutory regulator and does not centralise some of the most important regulatory powers, such as licensing for domestically manufactured drugs. It does not address the issue of emergency authorisation even after the pandemic experience”.

The goal of drug regulation legislation should be to safeguard and advance public health, not to encourage trade and investment in the pharmaceutical sector. Public health legislation must specify the roles and responsibilities of regulatory agencies, allow them specific authority to carry out those roles and impose limitations to prevent them from abusing their authority. The main takeaway from the saga is that the pharmaceutical industry and its lobbies continue to be prioritised over public health issues in a substantial portion of India’s drug regulation framework.

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