The Rs 40,000-crore drug export industry is restive after the decision of the Drugs Controller General of India (DCGI) to centralise all export clearances.
This was done through a directive which took effect from October 1. It has already seen some legal challenges, and more are in the offing. Last week, the directive was stayed by the Madras High Court after a state-level drug officers association pleaded the order breached existing rules, which do not give the central drug regulator any monopoly rights in export clearance.
A similar stay order was issued by the Karnataka High Court a few days earlier, according to industry officials. Many industry associations are also planning to approach various high courts.
"Our experts have studied the issue and they feel this directive is beyond the DCGI's purview. They also said the DCGI office is not equipped to handle the huge task before them. This will obviously result in delays in export clearances," said Daara Patel, secretary general of the Indian Drug Manufacturers' Association.
The directive has led to confusion among state regulators and the industry on the grant of Certificate of Pharmaceutical Products (CoPP), a requisite for export of medicines from the country.
The issue has come up at a time when DCGI is getting a record number of applications for export of medicines. According to official statistics, the applications for importing samples for developing medicines meant for exporting purposes has been increasing significantly over the years. While DCGI received 600 such applications in 2007, it was 1,300 in 2008. During the first six months of the current year, it has already received 1,070 applications.
Admitting the complexity of the issue, senior government officials said the DCGI’s was an ‘administrative order’, as the Drugs and Cosmetics Act of 1940, and the rules under the Act that were notified in 1945, do not mention ‘drug exports’.
“We were completely import dependant at the time of framing those rules. So there was no question of having an export rule then”, a health ministry official explained.
The proposed Central Drugs Authority Bill, which aims at a comprehensive amendment to the existing Act, including the export clearance issue, is in the consultation stage. The parliamentary panel headed by Amar Singh that has looked into the bill has sought opinion from all state governments to finalise its views. Sector experts do not see the new legislation being finalised in the near term.
The move to centralise export clearance gathered momentum after complaints from several places on the quality of Indian medicines. The government was successful in proving such medicines were not originating from India, but carried fake ‘Made in India’ labels. Yet, a decision was taken to strengthen the regulatory system to improve India’s image as a preferred source of low-cost, high-quality medicines.
