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Indian Pharma Industry

GS Paper 3

 Syllabus: Industrial Growth/ Governance


Source: IE

 Context: The article emphasizes the need to improve India’s drug regulatory regime to ensure credibility in the pharmaceutical industry.


Status of India’s pharmaceutical industry:

Generic medicines India is the largest manufacturer of generic medicines globally (valued at US$50bn currently and expected to reach US$130 Bn by 2030)


India’s ranking in production Indian Pharma ranks third in pharmaceutical production by volume. India is often referred to as the ‘pharmacy of the world’


Vaccine supplier India is the largest vaccine supplier in the world by volume (over 50% of all vaccines manufactured in the world)


Major pharmaceutical hubs in India Vadodara, Ahmedabad, Ankleshwar, Vapi, Baddi, Sikkim, Kolkata, Visakhapatnam, Hyderabad, Bangalore, Chennai, Margao, Navi Mumbai, Mumbai, Pune and Aurangabad, Pithampur.



Various issues associated with regulating the pharmaceutical industry in India:

Issues Description Example
Quality control failures Instances of contaminated medicines and substandard drugs raise concerns about product safety. Contaminated medicine causing deaths in Gambia or Uzbekistan (2022)
Intellectual Property Rights (IPR) Allegations of violating IPR laws Patent infringement case between Roche and Cipla.
Pricing and affordability Challenges in balancing the need for affordable medicines for the poor with the profitability of pharmaceutical companies. Concerns by pharma companies overpricing of drugs within

National List of Essential Medicines (NLEM)

Healthcare infrastructure and access Issues related to inadequate healthcare infrastructure, uneven distribution of facilities, and low insurance coverage. Limited access to healthcare in rural areas of the country.
Global reputation Maintaining a strong global reputation as a reliable supplier of high-quality pharmaceutical products. Global Pharma Healthcare had to recall a batch of eye drops exported to the US due to links with vision loss (Feb 2021)
Regulatory framework India has 36 drug regulatory bodies causing confusion and non-effective enforcement of regulations.
Transparency and credibility Lack of public disclosure of drug application reviews.
Environmental sustainability E.g., Implementing green chemistry and waste reduction measures has been found to be non-existent.


In India, drugs and cosmetics are regulated by:

  • Act: Drugs and Cosmetics Act, 1940 and Rules 1945: It assigns various responsibilities to central and state regulators.
  • Agencies:
    • Drugs Controller General of India (DCGI): It is responsible for approving licenses for specified categories of drugs, setting standards for manufacturing, sales, import, and distribution of drugs in India, and heads the department of CDSCO.
    • Central Drugs Standard Control Organisation (CDSCO): It prescribes standards for ensuring the safety, efficacy, and quality of drugs, cosmetics, diagnostics, and devices. It also regulates the market authorization of new drugs and clinical trial standards.
    • National Pharmaceutical Pricing Authority (NPPA): It controls the pricing of pharmaceutical drugs in India


Steps that can be taken by the government:

Steps Description
Amend the Drugs and Cosmetics Act (1940) Modify the existing legislation to align it with current requirements and enhance regulatory oversight.
Create a centralized drug database Establish a comprehensive database to facilitate effective surveillance of all pharmaceutical manufacturers.
Merge India’s 36 regional regulators Consolidate the regional regulatory authorities into a unified entity to streamline the regulatory process and reduce the risk of inconsistent enforcement.
Set common quality standards across states Implement uniform quality standards across all states to ensure consistent product quality and reduce the risk of varying regulatory enforcement.
Increase budgetary support Allocate additional funds to strengthen inspection teams and conduct more frequent inspections related to product quality.
Impose clear penalties for firms exporting spurious drugs Establish strict penalties for companies involved in exporting counterfeit or substandard drugs. This will deter such practices and safeguard public health.
Create a public database of safety data Develop a comprehensive safety database that contains information on drug-related adverse events, side effects, and other safety concerns.
Enact a national law on drug recall This will ensure swift and effective recall processes, protecting the public from potentially harmful drugs.
Strengthen CDSCO Strengthen the Central Drugs Standard Control Organisation (CDSCO) and provide it with statutory backing
WHO’s Good Manufacturing Practice certification Promote and incentivize pharmaceutical manufacturers to adhere to the WHO’s Good Manufacturing Practice (GMP) standards.



Indian government can enhance the quality and regulation of the pharmaceutical industry through legislative amendments, centralized drug databases, and the merging of regulators. It will build confidence, ensure high-quality generics, and uphold India’s reputation as a reliable supplier, benefiting both domestic and global healthcare while protecting public health.


Insta Links:
Spurious Drug Menace


Mains Links:

India enjoys an important position in the global pharmaceuticals sector. Analyse the strength and weaknesses of India in this sector. Suggest steps to overcome the weaknesses. (250 Words)