Dealing with fake drugs

Dealing with fake drugs

The Mashelkar Committee, which studied the various aspects of the growing threat from spurious drugs, submits an interim report recommending stringent punishment for offenders.

  • THE Indian pharmaceutical industry has a domestic turnover of more than Rs.20,000 crores and exports over Rs.10,000 crores. It is also growing at the rate of over 10 per cent for the last decade and is said to be the fourth in the world in terms of volume. But a consumer has good reasons to be concerned about the lack of availability of safe and genuine medicines. For, the problem of spurious and substandard drugs in the country is quite rampant, as is evident from periodic reports in the media on seizures and confiscation of fake drugs from large consignments or godowns. These, however, would constitute only a small fraction of the real extent of the illegal activity, which perhaps is no different from the extent of counterfeit trade in other commercial products.



R.A. Mashelkar, Chairman of the Committee on Drug Regulatory System.

Monitoring of, and control over, pharmaceuticals, however, ought to be much more stringent since it concerns the health of the citizens and the harm that spurious drugs can cause is far more serious than that caused by any other consumable good. There have been the usual platitudes in the drug policies announced over the years. Members of Parliament too do not fail to make their customary quota of appropriate noises in the House. But beyond these there have been no concrete enforcement measures or regulatory mechanisms to bring about a change in the ground reality. The current status of the regulatory apparatus in the country is indicated in Box 1.

One would recall the serious case of intravenous (IV) fluid contamination at JJ Hospital, Mumbai, in 1988-89 and the famous Lentin Commission Report on the incident. The commission had made pertinent observations, and recommended appropriate changes in the drug regulatory system. The result was an amendment to the rules to provide for a dual licensing mechanism in December 1992, with a Central Licence Approving Authority (CLAA) and the States being the licence issuing authorities. The idea was to implement uniform norms but the change has not had the desired impact. Indeed, a repeat of the incident was witnessed in Delhi about four years later but there was no perceptible action by the government to improve the monitoring, testing and control system.

More recently, the Supreme Court and the National Human Rights Commission too have expressed their concern about improving the drug regulatory system. In response to this growing concern, the Central government constituted, on January 27, an expert committee under the chairmanship of R. A. Mashelkar, Director-General of the Council for Scientific and Industrial Research (CSIR), to examine all aspects of the regulatory infrastructure. The committee was also required to evaluate the extent and problem of spurious and substandard drugs in the country. Its mandate was to suggest a road map for implementation of the recommended measures.

The Committee had as its members an eminent scientist, an eminent lawyer, a former Drugs Controller-General of India (DCGI) and a former police commissioner, and officials representing key Central and State Departments/Ministries, drug manufacturers, trade, consumer and professional associations. The present DCGI was its member-secretary. Two sub-committees looked at specific and distinct terms of reference of the main committee. The deliberations had the benefit of presentations by scientists, such as Nityanand, Ranjit Roy Choudhary and Anant Narayana, and representatives of the Indian Medical Association (IMA), the Delhi Pharmaceutical Trust, Ahmedabad-based Consumer Education and Research Centre (CERC) and the Confederation of Indian Industry (CII). Although the Committee was required to submit its final report within six months, it secured a three-month extension and released its `interim report' on August 12.

THE core issues, the report said, have remained unresolved despite the numerous recommendations made by committees constituted by the government from time to time, which have been implemented partially. The Drugs and Cosmetics Act (D&CA) of 1940, it observed, had not been reviewed in a comprehensive manner at all since its enactment. The Hathi Committee Report of 1975, for example, had recommended measures to strengthen and streamline the Central and State Drug Control Organisations. While the Centre has implemented a few of the recommendations, the States have hardly implemented them. The committee had also called for the setting up of a National Drug Authority, a concept that has been reiterated in different forms at different times, the latest being by the Pharmaceutical Research and Development Committee (PRDC) in 1999, but little progress has been made on that front.

Among the recommendations made by the committee, the one recommending an enhanced maximum punitive action possible for the manufacture or sale of spurious drug from life imprisonment to death penalty has attracted greater attention and media publicity. The death penalty provokes a lot of debate, and the same is likely to ensue in the case of punishment for producing and selling spurious drugs too. But, in arriving at this recommendation the committee has noted that there is a discernible trend of organised crime taking over the manufacture and sale of counterfeit and spurious medicines and that so far not a single prosecution has resulted in life imprisonment. The committee felt that only an enhanced punishment can serve as a deterrent and instil fear among offenders.

According to the report, interestingly, there is no mention of spurious drug offences in the Indian Penal Code. Also, the existing provisions are bailable and cognizable and are not in consonance with the provisions of the D&CA, the committee has observed. It has recommended that it be made non-bailable and cognizable and that the prosecution may be instituted by any police or Central Bureau of Investigation officer not less than the rank of a sub-inspector (instead of an inspector in the extant provision).

The case, according to the committee, should be tried by the court of the rank of a Session Judge or above whereas the extant provision provides for a trial by a metropolitan magistrate or a first class judicial magistrate or above. The committee noted that most of the cases relating to spurious drugs remained undecided for years and has suggested a separate provision for speedy trials of such offences.


The legislative provisions in different countries cited by the committee makes for interesting comparison. Death penalty seems to be rare among the countries that the committee has studied. The only countries that have death sentence as punishment for the offence are Vietnam, the United Arab Emirates, Oman, Bahrain, Kuwait and Qatar. In the Indian context, the recommendation appears to be more in the nature of a substitute for an ineffective regulatory-cum-judicial system. The committee has called for amendments to the D&CA incorporating these legal provisions.

Even though the menace of fake drugs has been around for decades and is widespread in the country, it is indeed startling that there is no authentic data on the extent of the problem. The Mashelkar Committee too fails to throw any light on the issue except admitting that there is no data and referring to unconfirmed media reports. It is, indeed, a telling commentary on the regulatory framework, the public health system and the law enforcement machinery of the country that there are no records of confiscations and no periodic surveys of drug manufacturers and wholesale and retail outlets conducted to get a measure of the problem. It is also surprising that industry associations, considering their economic losses, too do not have any reliable data.

"Every one knows where counterfeit drugs are sold in Delhi, for example," says a scientist of the Delhi Science Forum, a non-governmental organisation. "Anyone can go to Baghirath Place and buy any medicine you want including empty capsules at a fraction of their actual price and no action has ever been taken," he points out. "The authorities just don't want to address the problem. The reason is widespread corruption in the drug control system in the country." The Mashelkar Report merely lists a set of factors (Box 2) leading to proliferation of fake drugs but does not go into the real reasons for lack of data. The survey that the Delhi Pharmaceutical Trust has now offered to conduct at a cost of Rs.15-20 lakhs is a task that the health authorities need to carry out periodically and systematically as a well-designed statistical exercise involving a body like the statistics division of the Indian Council of Medical Research (ICMR) and not as a one-off NGO project as the committee recommends.

According to the report, the figures quoted in the media and by different sources on the extent of spurious drugs have varied from 0.5 per cent and 35 per cent. Obviously, given the variation, the data are unreliable. The lower limit is based on the samples tested by the State authorities for the period 1995-2003. The upper limit is from a report in the medical journal Lancet in 2001 by an Indian journalist, ostensibly based on World Health Organisation (WHO) figures, which had claimed that 35 per cent of world's counterfeit drugs came from India, the fake drug market of which itself was over Rs.4,000 crores (about 20 per cent of the total turnover).

WHO, however, wrote to the committee on August 11 - just a day before the report was released - clarifying that there was no study conducted by WHO that had said that 35 per cent of world's spurious drugs are produced in India. Interestingly, the WHO letter went on to add: "The Indian pharmaceutical market, with annual sales ranging between $7 billion and $8 billion, ranks third in the world, and the majority of the Indian pharmaceuticals are produced by large manufacturers according to WHO Good Manufacturing Practices (GMP)!" It could be noted that these figures differ from the government's own figures.

The presentation by the CII representative in July too was based on media reports as the organisation was unable to provide any evidence for its figures. The CII used an arbitrary fraction of 18 per cent of the turnover as being spurious and concluded that the revenue loss to the industry was over Rs.4,000 crores. It also added that the majority of government supplies failed the quality test (without saying who conducted these tests?) and that India produced 35 per cent of the world's spurious drugs. The CII is supposed to provide evidence to the Committee, which will be included in the final report in October, says the interim report.

The Committee has noted that while appropriate regulatory and legislative systems exist, there is considerable non-uniformity of interpretation of the provisions of the laws, and enforcement standards followed by State drug control authorities. The Central Drugs Standards Control Organisation (CDSCO), headed by the DCGI, discharges the functions allocated to the Central government. The State Drug Control Organisations exercise the functions of the States. However, the infrastructure facilities and the number and quality of drug inspectors, testing facilities, and support systems vary from State to State.

While in some States the organisation is headed by a technical person, others have administrators, police or medical persons as heads, the report points out. Only a few States have well-equipped testing laboratories, while most have no laboratory or have a small one with scant testing facilities. As per the data collected by the committee, only 15 of the 26 States surveyed have functioning testing laboratories of which only seven were reasonably well equipped and staffed.

The number of inspectors is also not sufficient to meet the work load and to monitor the quality of drugs. A government task force set up in 1982 had recommended one inspector for every 25 manufacturing units and one for every 100 sales premises. This recommendation, the report says, has largely remained on paper. The committee has also noted that only 10 States have so far set up intelligence-cum-legal cells as recommended by the Hathi Committee.

This says the report, has the potential to lead to many inter-State complications and open up the possibilities of continuous proliferation and movement of substandard drugs. As a result, a drug manufactured in a State, with a weak regulatory mechanism is sold in another State freely as well as in the export market. A comparison of legislative provisions in other countries as given in the report shows that only in India is the subject of drugs controlled at the State level. According to the report, ipso facto, the Ministry of Health and Family Welfare had made proposals for the expansion of CDSCO. The government, in turn, created several new posts in 1992. Apparently, these posts could not be filled due to "administrative complexities" and have since lapsed. Efforts made to revive these posts have borne no fruit, says the report.

The 1999 PRDC, also headed by Mashelkar, had recommended a comprehensive strengthening of the CDCSO to enable it to carry out the multifarious activities that the department was expected to perform, especially in the post-2005 World Trade Organisation - Trade-related aspects of Intellectual Property Rights (WTO-TRIPS) situation. In order to facilitate the above, it had envisaged a new structure for the CDCSO. The report has observed that, although three years have elapsed since the PRDC recommendations, "no infrastructural improvement whatsoever in respect of manpower had occurred in the CDCSO".

The concept of a National Drug Authority, as envisaged in the Hathi Committee, did not find favour with the government and hence the first national drug policy in 1978 did not refer to a National Drug Authority-like body. However, the concept surfaced in the 1986 Drug Policy as National Drug and Pharmaceutical Authority (NDPA) but without clear enunciation of its functions. The Drug Policy of 1994 once again called for an autonomous body by an Act of Parliament called the National Drug Authority (and not NDPA)to strengthen the drug control system and to enforce appropriate quality standards and GMPs. It was intended to perform the specific function of quality control and quality assurance with emphasis on monitoring and policing.

The Mashelkar Committee has observed that the above functions were already mandated to be carried out by CDCSO and the State Drug Controllers. The Health Ministry too considered the proposal at various stages during 1994-2000 and drafted a bill for the creation of the Authority to be funded by levying a cess as envisaged. However, because of administrative complexities involved in such a structure, the idea was, apparently, dropped.

The 2002 Drug Policy called for setting up of a "world-class CDSCO by modernising, restructuring and reforming the existing system" rather than the National Drug Authority. The Mashelkar Committee too sent out a questionnaire to all the States seeking their views on the matter. Apparently, 15 States responded saying that if the CDCSO could perform the statutory functions efficiently, there was no need for a National Drug Authority.

Based on these considerations, the committee has concluded in the interim that, while the existing infrastructure at the Centre and in the States is not adequate to perform the assigned functions efficiently, creating an additional authority will not solve the problem. It has, therefore, recommended a strong, well-equipped and professionally managed CDCSO, which could be the accorded the status of Central Drug Administration (CDA), as the most appropriate solution.

How the Committee proposes to do so without basic data on the extent of the problem is not clear because the proposed survey by the NGO is expected to be completed in three to four months. Also, whether a well-run CDA is sufficient to eradicate the menace of spurious drugs remains to be seen because the fundamental problem in all social maladies in the country is that of corruption. That needs to be tackled first; the Mashelkar Committee would do well to recommend strong punitive action against those involved in drug-related cases of corruption.
Current regulatory systems

At the Central level

  1. Laying down regulatory measures and amendments to the Drugs and Cosmetics Act (D&CA), 1940, and Rules.
  2. Approval of new drugs introduced in the country.
  3. Permission to conduct clinical trials - registration and control on the quality of imported drugs.
  4. Laying down standards for drugs, cosmetics, diagnostics and devices and updating India Pharmacopoeia.
  5. To approve licences as the Central Licence Approving Authority (CLAA) for the manufacture of large volume parenterals and vaccines and operation of blood banks and such other drugs as may be notified by the government from time to time.

Coordinating the activities of the States and advising them on matters relating to uniform administration of the Act and Rules

At the State level

  1. Licensing of drug manufacturing establishments and sales premises.
  2. Carrying out inspections of licensed premises for ensuring compliance to conditions of licences.
  3. Drawing samples for test and monitoring the quality of drugs and cosmetics moving in the State.
  4. Taking appropriate action like suspension cancellation of licences.
  5. Instituting legal action wherever needed as provided under the D&CA and Rules.

    Problem areas

    A list of possible factors contributing to proliferation of spurious drugs, according to the Mashelkar Committee Report

  6. Lack of enforcement of existing laws;
  7. Weak penal action;
  8. Very remunerative trade;
  9. Large-scale sickness in small scale pharmaceutical industry*;