18 Pharma Companies Lose Licenses: Why It Won't Change Much For Drug Regulation

From lack of communication to a lack of accountability, drug regulations in India continue to be a mess.

6 min read
Hindi Female

Drugs made in India have been increasingly coming under fire for substandard quality and contamination causing a slew of health issues, and in extreme cases, deaths.

In a major action taken by the central drug regulator in the country, the Drugs Control General of India, 18 pharmaceutical companies have reportedly lost their licences, and been asked to stop manufacturing 'poor quality medicines.' At least 26 have been issued show cause notices, and product permission of three companies have been revoked. 

This shows that this one time when the regulators actively took steps to figure out loopholes in the drug regulatory system, they found so much irregularity.

Now imagine if inspections like this happened all over India in all facilities.


Why Were These Licenses Revoked?

But here's the catch that once again throws light on the stark opacity in the system of drug regulations in India – there is no official public document from the authorities themselves regarding this. The cancellation orders or the show cause notices are not available in the public domain.

All we know is that the licences of 18 pharma companies were revoked through source-based news reports. Some are calling it spurious drugs, others are saying t's adulterated drugs, and many are labelling it as 'sub-standard quality.'

But, there is no information available to understand how this happened. It's not even clear why these 18 licences were really revoked.

Which companies have been pulled up? On what basis were they selected for inspection? Which drugs were found to have issues? Was the issue with the manufacturing process?

Was testing of finished products not happening? Or were there flaws in the raw material? Will this have any impact at all?

Opacity, Lack of Accountability: The Fault in Our System

  • Opaque mechanism

And the lack of clarity makes it difficult to properly weed out the issues in the supply chain.

For instance, if the issue were with the raw material, then you would have to trace back the supplier and all other pharma companies that procure material from that supplier would have to be inspected. 

In the cases of deaths linked to DEG-contaminated cough syrups, the problem was that these manufacturing companies were making a number of different cough syrups. Even after these multiple instances, there was no proper inspection of all the drugs these companies manufacture. 

If the root cause is the raw material, then how do we know if there are other drugs being made using the same raw material? 

Because one action is dependent on the previous action, only once we have answers to these questions can we know how to proceed.

  • Loopholes built into the system

In India, since there is no public database for this kind of information - Which company was inspected at what time, for what reason, what action was taken - it becomes easy for them to slip under the radar, and there's no way of tracking them in the future.

For instance, if a company is denied a manufacturing licence by the drug regulator in one state, they go and apply for a licence in another state, especially, where there is laxity in regulatory standards, and there is no coordination between these state drug regulators to get past records on companies.

It is even difficult for state drug regulators to take action against manufacturers operating outside their states because of the non-cooperation in sharing manufacturer’s details by the regulator of the manufacturing state.

This issue has been raised time and time again in drugs consultative committee meetings. 

Some state regulators have also raised the issue that the only way for them to get any sort of information from other state regulators is by initiating criminal action against them. That's how bad the lack of coordination is.
  • There is no legal framework to hold the manufacturers and regulators accountable to withdraw contaminated drugs

In January, eye drops manufactured by a Chennai-based pharma company were found to be contaminated with a deadly drug-resistant bacterium. But the thing was that those eye drops were only being exported to and sold in the US.

The company promptly voluntarily recalled all units of the eye drops of the faulty batch and the problem was contained given it had a limited market and the US had an effective drug recall system.

Now compare this to what happened in the Jammu, Gambia, and Uzbekistan incidents where children died of DEG contamination in cough syrups. 

11 children died in Jammu in January 2020 after consuming a contaminated cough syrup manufactured by Digital Vision, a Himachal Pradesh-based company.

However, other cough syrups manufactured by this company continued to be in the market and led to the death of another child in August in the same year.

Had the drug regulator gone into the cause of the first incident (probably the DEG-contaminated raw material sourced by the manufacturer in this case) and recalled all cough syrups manufactured by this company, this other tragedy could have been avoided. 

In the Gambia incident on the other hand, forgetting about taking up the responsibility to recall concerned cough syrups manufactured by Maiden Pharmaceuticals from the market, the DCGI denied all the allegations and found no faults in the manufacturing unit.


While the licence of Marion Biotech, the company involved in the Uzbekistan incident has been revoked, there is still no clarity on what happened to the drugs manufactured by it, are they still available in the market?

In India, we do not have a uniform legal mechanism to recall drugs which particularly mandates the central and state regulators to immediately withdraw contaminated drugs.

It doesn't even put any obligation on the manufacturer to take immediate steps to do so.

This is the reality. When something like this happens, the only way we can really correct it is if the company themselves voluntarily take proactive steps to recall and contain the damage, like in the case of the eye drops.

There are only some guidelines that were issued in 2019 about how drugs may be recalled. But these guidelines are not enforceable, and in a country like India where the whole drug regulations and manufacturing licence process is chaotic and fragmented, it becomes important to have a strong law that can facilitate this process more effectively.

In the End, It’s the Consumers That Lose Out

We keep hearing that a particular drug is banned, but they continue to be sold, and bought because there is no awareness about it in the public, and even among retailers regarding these developments. 

Even if the company is prevented from manufacturing those drugs, what of the units that are already in the market? 

For the public, the most basic information they should be knowing is what kind of drugs these companies were manufacturing, at what level, and to what extent these drugs are circulating in the market.

Unless this kind of information, and database is made public centrally, and uniformly, proper action cannot be facilitated. 

Due to the attention the Gambia and Uzbekistan tragedies received globally, at least the public in India is now aware of the pharma companies who were involved and can be careful about the drugs manufactured by them.

But, in the current instance of revocation of licenses, nobody knows who these companies are and what drugs have been found at fault.

It's not an unreasonable expectation to ask for public disclosure of this information. Other countries, including the US, have such public databases in place where the history of each pharma company is displayed publicly. Not only for the regulators to access, but also for the regular public, additionally proactive steps are taken by the regulator to withdraw drugs from the market and spread awareness among the public through mass communication

Unless these gaps in the system are adequately addressed and closed, spurious and substandard drugs are bound to slip through the cracks and flood the market. And as a consumer, buying something as seemingly harmless as an over-the-counter cough syrup will continue to be a gamble.

(As told to Anoushka Rajesh. Shreya Shrivastava is Senior Resident Fellow, Health at the Vidhi Centre for Legal Policy. This is an opinion piece and the views expressed are the author’s own. The Quint neither endorses nor is responsible for them.)

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