Panel to investigate pharma firms red-listed by Vietnam

CDSCO plans to rope in state drug control organizations to look into the issues raised by Vietnam over the quality of drugs from India


Photo: iStock
Photo: iStock

Close on the heels of Prime Minister Narendra Modi’s visit to Vietnam to “strengthen bilateral ties, including defence, security and trade”, the ministry of commerce and industries is planning to set up a committee, along with the Central Drugs Standard Control Organization (CDSCO), to inspect Indian pharmaceutical companies which have been banned from Vietnam for exporting sub-standard drugs.

CDSCO plans to rope in state drug control organizations to look into the issues raised by Vietnam over the quality of drugs from India.

Manufacturing practices of over 50 pharma companies are potentially suspect as they were “red-listed” for regulatory non-compliance by the Drug Regulatory Authority of Vietnam in 2014.

The companies which were red-listed included Strides Arcolab Ltd, Medley Pharmaceuticals Ltd, Marck Biosciences Ltd, Marksans Pharma Ltd and Umedica Laboratories Pvt. Ltd.

“The ministry of commerce has initiated discussions with us about looking into the manufacturing practices of Indian pharmaceutical companies red-listed by Vietnam. We are at the initial stages of the development,” an official from the CDSCO said, requesting anonymity.

Queries emailed to the ministry of commerce and CDSCO went unanswered.

Last year, the CDSCO and Pharmaceutical Export Promotion Council of India (Pharmexcil) had held a strategic meeting with their Vietnamese counterparts to assuage concerns being raised about the safety of Indian drugs.

“Repeated questions about the manufacturing standards and regulatory compliance of Indian pharmaceutical industry can damage the country’s stature as a global drugs exporter. If the complaints are genuine, the state drug regulating authorities may suspend or cancel the licenses of the errant companies,” another official from CDSCO said, also declining to be named.

The commerce ministry may also cancel or suspend the Import Export (IE) code of the companies, depending on the inquiry’s conclusion, said the first official cited earlier.

The IE code is a registration issued by the Directorate General of Foreign Trade and is required for importing or exporting goods and services from India.

Suspension and cancellation of the IE code could be done, as per the Foreign Trade (Development and Regulation) Act, on the grounds “that any person has made an export or import in a manner gravely prejudicial to the trade relations of India with any foreign country or to the interests of other persons engaged in imports or exports or has brought disrepute to the credit or the goods of the country.”

Industry analysts believe that while compliance and manufacturing practices of Indian pharmaceutical companies are getting better, the government must act against, and address systemic failures by companies.

“The perception of India as a safe generic drugs exporter should not suffer. While issues are bound to crop up, there should be no compromise on the safety and quality of drugs being exported. Failure by pharmaceutical companies to adhere to regulatory norms should not be treated by the government as simply a particular company’s issue,” said Muralidharan Nair, Partner – Life Sciences, E&Y.

A significant chunk of Vietnam’s pharmaceutical market comprises of generic drugs, with India being a significant exporter.

Industry estimates peg the overall market size at over $2.6 billion and expected to hit $8 billion by 2020.

In recent years, however, Indian pharmaceutical product exports to the Vietnamese market have dipped significantly, reflecting the effects of the ban. According to official commerce ministry data, exports fell 12% to $146 million in 2015-16 from $165 million in the previous fiscal year.

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