Draft Pharmaceutical Policy 2017: Salient Features, Issues and Analysis

The Draft Pharmaceutical Policy 2017 has been introduced by the Department of Pharmaceuticals with the objective of regulating the production and marketing of pharmaceutical products in India.

Salient Features

Key features of this policy are as follows:

Price Control to Monitoring

The new policy has an aim of reorienting the Drug Price Control Order (DPCO) in such a manner that its focus shifts from mere controlling of price to monitoring of price.

Powers of NPPA

The National Pharmaceutical Pricing Authority which has been functioning as an autonomous body will experience a massive dilution of its powers. Under the new draft policy the government will exercise control over the functioning of NPPA. The body will no longer revise the price of the drugs once the price is fixed, it will not be able to put a price cap on the in-patent medicines and its emergency powers can only be used on government’s orders.

Certain eliminations

The new policy will see elimination in third party manufacturing of the medicines and loan licensing.

Quality concerns

The policy asserts that while the drugs to be exported go through a process of stringent quality assurance as per the internal requirements of the importing countries, the same is not done for the indigenously manufactured drugs produced for Indian markets. Proper quality surveillance is not in place. The State Drug Administrators give permissions without following the bio-availability and bio-equivalent tests. The inspection of the premises of manufacture is not often conducted properly, as a result of this there are many manufacturing units which are not complying with the WHO’s Good Manufacturing Practices or the Good Laboratory Practices. Some of the solutions proposed are self-certification for the inspection of plants, ensuring that government procurement takes place only from the GMP and GLP compliant manufacturing units.

Benefits

The expected benefits of the policy are as follows:

Make in India programme

The policy with the restrictions and checks it seeks to impose can give a boost to the idea of Ease of Doing Business in the pharmaceutical sector. This is turn will help in promoting the ‘Make in India’ programme further.

Identifying a major loophole

One of the biggest concerns of the Indian manufactured drugs is that of their quality. In the past, the government has denied any such lacunae when it had systematically shifted the blame on the foreign companies. One such example is the GVK Bio scandal. In this case the European Union had imposed a ban on certain drugs produced by GVK Bio claiming that clinical test data was fabricated. However, the Drug Controller General of India had blamed the EU and other multinational companies for trying to bring disrepute to India. The same position was taken in the Ranbaxy Scandal. But the data for the last 5 years has shown that there was a serious issue of quality of Indian drugs. The Indian Pharmaceutical Association (IPA) had admitted that around 85% of drugs from India have severe problems with respect to therapeutic efficacy and safety. But the true situation has finally been admitted in the new policy and new methods of addressing these issues have been identified.

Issues and Problems

The Key issues related with this policy are as follows:

Excessive interference

The policy is likely to result in an increase interference of the government. Although the policy says that the regulator and the government must be different, the government shall appoint an advisory body having representation from the government, industry and civil society.

NPPA underestimated

Various positive steps taken by the NPPA like imposing a price cap on cardiac stents and knee implants cannot be ignored. Taking away the autonomy will affect its functioning in this regard to a great extent.

Eliminating loan licenses

While the policy seeks to eliminate loan licenses, about one-third of the industry runs in loan licensing. It will not only affect the availability of medicines but also loss of employment to a large number of people employed in this sector.

Price control policies

The price control policies will not affect the multinationals much as they hold patents in the medicines, rather it will affect the cheap medicines produced for domestic consumption. The idea of monitoring prices instead of capping has also not been explained clearly.

Addressing quality concerns

While the quality concerns have been pointed put rightly but the steps taken to deal with them are very weak. For example providing for self-certification even after the knowledge of lack of transparent methods of inspection of plants. Even if the government wishes to procure drugs from GMP and GLP compliant manufacturing units the units have been able to escape these criteria when these were compulsory under the Schedule M and L of the Drugs and Cosmetics Act, 1940. So, the solutions are not well thought out.

Comment

While the Draft Pharmaceutical Policy 2017 appears to be a promising policy, the pharmaceutical industry has not been very happy about the developments. There are several lacunae identified which blatantly outweigh the reforms that have been proposed in the policy. So, it may be regarded as a half-hearted policy formulation with little thought given to deal with the substantive issues. However, one major area that is likely to witness a major change is the quality procured by the procurement agencies. The railways, Jan Aushadhi stores, armed forces and government hospitals already procure medicines through testing the consignment procured. The testing provides a huge bank of useful data. The new provisions may help in integrating all these data together they can be easily accessed by the public and private procurers. So, some form of comprehensive mechanism can be developed. But the need for a more comprehensive reform is necessary which is not clearly envisaged in this draft policy.