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PDMA asks govt to create separate category for units below Rs. 10 crore & allow 3 years to implement revised Schedule M
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Gireesh Babu, New Delhi
January 14 , 2025
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The Punjab Drug Manufacturers Association (PDMA) has sought the Union ministry of health and family welfare to create a separate category for units below Rs. 10 crore turnover outside the erstwhile tax holiday areas and allow them three years for compliance with revised Schedule M manufacturing standards.
The Association submitted its comments on the draft notification issued by the Ministry on January 4, allowing extension of deadline for revised Schedule M compliance for units with turnover below Rs. 250 crore on condition that the units should submit applications with the Central License Approving Authority (CLAA) with gap analysis and plans or strategies starting on or before March 31, 2025 and to comply with the revised standards.
Based on this condition, the Ministry has extended timeline for such manufacturers till December 31, 2025, for implementation of the standards.
"The Central License Approving Authority to whom a unit is supposed to apply for extension in Form A is not a valid authority applicable to our units. There is no provision in the Drugs Act under which it can seek any data either. Unless the Parliament legislates, the Central government cannot assume such powers," said the Association in its letter to the Under Secretary (Drugs), Ministry of Health. It thanked the Ministry for considering the fact that the micro and small units require an extension period for compliance of the revised Schedule M.
"The benchmark turnover of Rs. 250 crore goes to show that around 70-80 per cent units in the sub Rs. 10 crore category have been ignored. We have little say in the government. But we can neither be bracketed with Rs. 250 crore turnover units nor with units in erstwhile Tax Holiday States who thrived at our cost," it added.
"We have no sympathy for units who lack basic plant, machinery and technical staff deficiencies which are leading to NSQs on a regular basis. However, the implementation should be in a phased manner," said Jagdeep Singh, president, PDMA.
"As a first step to ensure the quality of the drugs, the emphasis should be laid on testing as per Rule 74/76, which shall avert any Gambia-like mishap," said the Association. It may be noted that the Gambia government has alleged that an Indian made cough syrup has resulted in the death of several children). Rules 74 and 76 involve conditions of license for manufacturing of various Schedule of drugs.
"Other aspects like plant, equipment, HVAC system, utilities, documentation can be taken up one by one which needs another 3 years for units below Rs. 10 crore turnover in view of facts explained....," it added in its submission.
National Institute of Pharmaceutical Education and Research (NIPERs) may be pressed into service by the government to impart training especially for QA, Documentation and validations. Reference standards may be supplied at half price.
All joint Inspections/RBI may be stopped to let MSEs focus on upgradation during the extension period. It may be noted that the Association is fighting a legal battle in the High Court against the joint inspections organised by the central licensing authority and the state licensing authority.
Stringent RBI/joint inspections that are shutting down units, albeit illegally, are perceived as regulatory terrorism by families of the owners. When a 20-30 year old unit is shut down it has grave consequences because unsold medicines expire, bank loans cannot be paid and the debts from customers cannot be realized when supply ceases, it added.
When such examples are set, children abhor the idea of joining family business. In addition, it demoralizes the entrepreneur spirit which is diametrically opposed to Make in India of the Prime Minister Narendra Modi.
Quality is no good without affordability. The amendment will cause a price rise because Jan Aushadhi and DPCO 1995 drugs will be wiped out in one stroke unless a minimum 50% rise in ceiling prices is affected.
Survival of micro and small industry is pivotal to availability of affordable drugs in the country, it added.
The units, which are outside the erstwhile tax haven states suffered almost 14 years till 2017 when the Goods and Services Tax (GST) was levied, losing customer base to units in the tax holiday areas of Himachal Pradesh, Uttarakhand, Jammu & Kashmir, and Sikkim.
While the units are making efforts to upgrade, this, along with poor quality of education of pharmacy graduates, lack of government's measures to make services available from NIPER for upgradation, poor water quality for medicine production, and joint inspections, are posing challenges.
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