CGHS Crisis: Faulty Generic Drugs Cause Health Nightmares

On May 12, 2023, Dr. Atul Goel, who was serving as the Director General of Health Services (DGHS) at the time and held the post until April 2025, issued a contentious circular that sent ripples through India’s healthcare system. The directive, addressed to Central Government Hospitals, CGHS Wellness Centers, and Polyclinics, mandated strict adherence to prescribing only generic medicines. The move, aimed at reducing healthcare costs and curbing pharmaceutical influence, has ignited a fierce debate among doctors, patients, and policymakers. While the government touts affordability and equity, critics argue the policy is premature, citing quality concerns, supply chain issues, and loss of medical autonomy.

The Circular’s Core: A Mandate for Generics

The circular reiterated a standing instruction: all doctors, including residents, in Central Government healthcare facilities must prescribe generic medicines only. Despite repeated directives, the DGHS noted persistent non-compliance, with some doctors continuing to prescribe branded drugs. This practice, the circular stated, was viewed “strictly” by the competent authority. 

To ensure adherence, the circular instructed heads of institutions to monitor doctors closely and enforce strict compliance. The directive emphasised that prescribing generics was non-negotiable and those who prescribe branded drugs will be liable for further action. Additionally, the directive took aim at pharmaceutical marketing, banning medical representatives from visiting hospitals. 

The Intention Is Good, But Is It Too Premature?

While the circular’s goals of affordability and equity are laudable, critics argue that its implementation is rushed and overlooks critical gaps in India’s healthcare ecosystem. The push for generics aligns with global trends and national priorities, but systemic challenges—ranging from quality assurance to supply chain reliability—raise questions about its readiness. 

The government’s mandate addresses a pressing issue: India’s high out-of-pocket healthcare costs, which push an estimated 50–60 million people into poverty annually, according to World Bank data. Generic medicines, priced 50–90% lower than branded equivalents, offer significant savings. The Pradhan Mantri Bhartiya Janaushadhi Pariyojana, with over 15000 Jan Aushadhi Kendras, has demonstrated success with beneficiaries having saved a lot of money, making essential drugs accessible to low-income groups.

The Central Drugs Standard Control Organisation (CDSCO) asserts that generics meet Indian Pharmacopoeia standards for dosage, strength, and efficacy, ensuring equivalence to branded drugs. However, unlike the U.S., where the FDA mandates bioequivalence (BE) studies for all generics, India requires BE studies only for specific drug categories, potentially impacting consistency in generic drug performance.

This gap fuels doubts about whether all generics match branded drugs in bioavailability and efficacy. The IMA and CGHS Beneficiaries Welfare Association have raised concerns about variations in potency or purity, particularly for chronic conditions like diabetes or heart disease, where small differences can impact outcomes. 

Saha’s Adverse Drug Reaction and the Call for Accountability

Arun K. Saha, a retired Air India professional faced a harrowing ordeal after consuming a generic version of CIPLOX TZ prescribed by a CGHS Wellness Centre in Mumbai, in late 2024. Intended to treat a minor stomach infection, the generic drug triggered severe adverse reactions, including acute stomach pain, constipation, mucus, and fever—symptoms Saha had never experienced before. His condition deteriorated rapidly, requiring three hospitalisations across Seven Hills, Fortis, and Hinduja Hospitals in Mumbai. 

Saha underwent extensive diagnostic procedures, including two colonoscopies, two CT scans, a PET scan, an MRI, an endoscopy, X-rays, and ultrasounds, incurring massive financial and emotional distress. “This was one of the most harrowing experiences of my life. After all the adverse reactions to this medicine, I finally went to Hinduja Hospital where Dr. Philip Abraham, a gastroenterologist, asked me to take the branded version of CIPLOX TZ. Within no time, I was cured. This raises serious questions about the quality of the generic version of the drug to which I had adverse reactions. This could be life threatening to so many patients,” stated Saha speaking to The Probe. 

Saha decided to take up this matter with the higher officials within the government. “I felt this drug, if it is of poor quality, must be immediately withdrawn from the market. So, on December 28, 2024, I submitted the remaining strip of the generic medicine and a completed Adverse Drug Reaction (ADR) form to concerned authorities at Wellness Centre 26 as advised by Dr. Geetha Anandan, Additional Director, CGHS Mumbai, hoping for a thorough investigation. Unfortunately, six months have passed since I wrote to them, but I have not heard from the authorities yet,” added Saha. 

A Trail of Unanswered Queries

Despite Saha’s diligent follow-ups, the investigation into the suspect generic CIPLOX TZ batch stalled. On January 28, 2025, Dr. Bharat Doppalapudi, Senior Medical Officer at CGHS Mumbai, informed Saha that the case had been forwarded to the Central Drugs Standard Control Organisation (CDSCO). However, no substantive updates followed. 

Saha’s emails on January 29, February 22, March 30, and May 22, 2025, expressed growing frustration over the delay in action that potentially hampered the lives of many patients. The CGHS Beneficiaries Welfare Association of India also intervened, writing to Dr. Anandan on February 22, February 23, and May 24, 2025, urging expedited action and a timeline for the investigation. A preliminary CGHS review suggested the incident was “isolated,” but Saha contested this, pointing out that Wellness Centre 26 had other medicines classified as “not up to standard.” 

A Glaring Gap in Adverse Drug Reaction Reporting

Arun Saha’s case exposes a critical flaw in India’s healthcare system: the absence of a clear, standardised framework for reporting and investigating adverse drug reactions (ADRs) to generic medicines. Despite Saha’s submission of an ADR form and the suspect generic CIPLOX TZ strip on December 28, 2024, the Wellness Centre 26, Mumbai, and the CDSCO provided no clarity on the investigation process. Emails from concerned officials, including a January 28, 2025, response from Dr. Bharat Doppalapudi, revealed confusion over basic procedural elements, such as the designated reporting authority in such cases. This opacity is not unique to Saha’s case; it reflects a systemic failure to establish transparent channels for addressing adverse drug reactions. 

Compounding the issue is the absence of a recommended timeline for reporting or resolving ADRs, especially in urgent or severe cases like Saha’s, which required multiple hospitalisations and extensive diagnostics. CGHS and CDSCO correspondence offered no deadlines, leaving beneficiaries vulnerable to prolonged uncertainty and potential health risks. The January 28, 2025, email from the officials in Mumbai sought guidance from CDSCO on reporting channels and investigation protocols, indicating internal disarray even months after Saha’s complaint. This lack of structure affects millions reliant on generic drugs. Without a robust ADR framework, patients face unaddressed health risks, eroded trust in generics, and financial burdens from alternative treatments. 

“The government may say that they are trying to reduce costs by mandating generic medicines but the question is at what cost are you trying to make medicines affordable. It cannot be at the cost of human lives,” asserts Saha. 

Stockouts Undermine Affordability Promises

The DGHS’s 2023 mandate for generic-only prescribing hinges on affordability, but frequent stockouts at Jan Aushadhi Kendras expose its fragility. Beneficiaries often find prescribed generics unavailable. When generics are out of stock and branded drugs are non-reimbursable, patients face a stark choice: bear out-of-pocket costs for branded alternatives or endure treatment gaps. This directly contradicts the policy’s goal of reducing healthcare costs. 

Stripping Doctors and Patients of Choice

The generic-only mandate removes doctors’ discretion to prescribe branded drugs when medically justified, particularly for drugs with narrow therapeutic indices, such as anti-epileptics (e.g., phenytoin), where minor variations in bioavailability can trigger seizures or toxicity. The Indian Medical Association has flagged this risk, noting that generics’ inconsistent bioequivalence testing in India—unlike mandatory standards in the U.S.—can lead to adverse outcomes. Elderly CGHS beneficiaries, who often prefer branded drugs for their familiarity and perceived reliability, feel sidelined by the policy. 

Many doctors are grappling with serious concerns following the 2023 circular. They fear that the rigid policy restricts their ability to provide optimal care, especially for patients with critical conditions like cancer, kidney disease, liver disorders, heart conditions, or other life-threatening illnesses where precise treatment is paramount. They worry that generics, while cost-effective, may vary in quality or bioavailability due to India’s inconsistent regulatory oversight, as only a fraction of generics undergo mandatory bioequivalence testing. This variability could lead to reduced efficacy or adverse outcomes, a risk amplified by the limited testing capacity of state labs. 

The inability to honor branded medicine recommendations from private specialists further fuels doctors’ apprehension. Specialists often prescribe branded drugs for complex cases, citing consistent quality or patient-specific needs, but the generic-only mandate forces doctors to override these recommendations, risking treatment failure and patient distrust. For instance, a cancer patient requiring a specific chemotherapy drug may face delays or adverse effects if substituted with a generic of unverified equivalence. 

A Climate of Fear Stifles Autonomy

The explicit threat of disciplinary action for prescribing branded medicines, as outlined in the 2023 circular, has created a climate of fear among doctors. Senior physicians, speaking anonymously to avoid repercussions, express feeling trapped between policy compliance and their ethical duty to prioritise patient welfare. The mandate stifles their professional autonomy, preventing them from tailoring treatments to individual needs, such as prescribing branded drugs for patients with a history of adverse reactions to generics. 

“A large number of patients have also met with eventualities of death because of taking faulty generic medicines. After this circular was issued mandating only generic medicines must be prescribed, our association decided to take up this matter with the government. We also spoke to many senior level CGHS doctors. The doctors are also very frustrated. They told us that they can’t do much till this circular is rolled back by the DGHS. They too have been facing issues with many patients who have had adverse reactions to generic medicines,” said T.K. Damodaran, General Secretary of the CGHS Beneficiaries Welfare Association of India (CBWAI).

Dr. Damodaran adds, “Our Association CBWAI has repeatedly approached the Ministry for the roll back of the DGHS circular stating that this was nothing but unethical and inhuman to put so many human lives at risk. I had also submitted a letter to the Union Ministry of Health and Family Welfare explaining the problems faced by patients after consuming generic medicines noting that in certain cases people have lost their lives. But so far we have not got any positive response from the government on this”.

"Prior to the DGHS’s May 12, 2023, circular, CGHS doctors were permitted to prescribe branded medicines alongside their generic equivalents, allowing patients to choose based on preference, affordability, or medical needs. This flexibility catered to beneficiaries, particularly elderly pensioners, who often trusted branded drugs. Earlier, the choice was left to the patient to decide what they wanted to take. But now, patients are being forced to take generic medicines. This is nothing but playing with the health of millions of patients,” notes Damodaran. 

Tandon’s Struggle with Substandard Generics

Ravi Kumar Tandon, a CGHS beneficiary attached to Wellness Centre 3 in Lucknow, faced alarming health setbacks after being switched to a generic diabetes medication supplied through a Jan Aushadhi outlet. Tandon, who has managed his diabetes effectively for years, was previously prescribed Oxramet 50/500 (a branded combination of metformin and vildagliptin), maintaining fasting blood sugar levels between 110 and 130 mg/dL. 

However, in early 2024, WC 3 issued a generic substitute, which led to a significant deterioration in his condition. Tandon reported that his fasting sugar levels spiked to 200 mg/dL and stabilised at an elevated 160 mg/dL, indicating poor glycemic control. On June 14, 2024, he emailed the Additional Director, CGHS Lucknow, raising concerns about the generic drug’s quality and requesting laboratory testing to verify its chemical composition and bioequivalence to Oxramet. Tandon urged authorities to reinstate his branded medication pending the test results to safeguard his health, emphasising the life-threatening risks of uncontrolled diabetes.

“All I wanted was for the government to test this generic medicine, which was of substandard quality. It impacted my health, and I was sure it must be affecting the health of many other patients as well. I wanted the government to get this medicine tested and ban it after a thorough inquiry. So far, no action has been taken, and this medicine is still available in medical stores. Can you imagine how many people may have been affected by this?” asks Tandon.

A complaint was also sent by CBWAI taking up Tandon’s case highlighting the “poor and inferior quality” of generics supplied through Jan Aushadhi outlets. The letter called for priority intervention to protect senior beneficiaries like Tandon from “rotten medicines.” The lack of a prompt response from the authorities or a clear timeline for testing mirrors the systemic delays encountered by Arun Saha and points to a pattern of inadequate oversight. 

“Patient Safety Compromised”

The Indian Medical Association (IMA) has been a vocal critic of the DGHS’s 2023 circular. The IMA’s opposition echoes its resistance to a similar directive issued by the National Medical Commission (NMC) in August 2023, which also mandated the prescription of generic drugs but was later suspended following IMA’s intervention. The IMA argues that the DGHS circular compromises patient safety and undermines doctors’ autonomy due to the inconsistent quality control of generic medicines in India.

“We have urged the government to prioritise stringent quality assurance and reduce the cost of branded drugs, rather than enforcing the use of generics. Patient safety is being compromised when generic medicines are forced upon them. We are advocating for a flexible policy that allows doctors to prescribe branded medicines when medically justified. The government’s intention—to make medicines more accessible to the common man—is commendable, but the question remains: What steps has the government taken to ensure that the generic medicines being sold in medical stores are tested and safe to use?” asks Dr. Dilip Bhanushali, the National President of the Indian Medical Association.

Many agree that the government's intention to make medicines affordable for the common man is a commendable step. However, there is growing concern that the decision to mandate generic medicines is premature. Experts argue that substantial groundwork is needed before making generics compulsory. “The DGHS should address the problem of stockouts at Jan Aushadhi Kendras by strengthening supply chains, ensuring 100% availability of essential generics, and allowing reimbursement for branded alternatives during shortages. The government should establish a transparent, standardised framework for reporting and investigating adverse drug reactions (ADRs) linked to generics, with clear timelines for action to enhance patient safety. Investing in advanced pharmacovigilance systems, including digital platforms for real-time ADR reporting by doctors and patients, would build confidence in generics.The DGHS should also collaborate with state governments to upgrade drug testing laboratories and increase the annual testing capacity of the labs. Additionally, incentivising pharmaceutical companies to produce affordable branded generics through tax benefits or subsidies could bridge the gap between cost and reliability,” notes Dr. Damodaran. 

The Probe has written to Dr. Sunita Sharma, Director General of Health Services, seeking answers about the 2023 circular and its outcomes. We asked Dr. Sharma about the policy’s purpose, the steps being taken to ensure the quality of generics, the reliability of supply at dispensaries, the reporting of side effects, and how the government plans to balance affordability with doctors’ freedom to choose the best treatment for their patients. We will update this article as soon as we receive a response from the DGHS.