The Drugs and Cosmetics Act, 1940 (the DC Act), the Drugs and Cosmetic Rules, 1945 (the DC Rules) and the Medical Devices Rules, 2017 as amended by the Medical Devices (Amendment) Rules, 2020 (the MD Rules) regulate the manufacturing, import, sale, and distribution (including quality and safety) of pharmaceuticals and medical devices in India.
Under the DC Act, “drug” includes the following.
Blood Products, Narcotics, Micro-organisms, Etc
The DC Act along with the DC Rules regulates the collection, storage, processing, and distribution of whole human blood, human blood components by blood banks, and manufacture of blood products. They also regulate the functioning and operation of a blood bank as well as preparation of blood components.
The New drugs and Clinical trials rules 2019 (the CT Rules) apply to all new drugs, investigational new drugs for human use, clinical trials, bioequivalence studies, bioavailability studies, and ethics committees.
The Narcotic Drugs and Psychotropic Substances Act, 1985 (the NDPS Act) along with the NDPS Rules, 1985 (the NDPS Rules) regulate the production/manufacturing/cultivation, possession, sale, purchasing, transport, storage, and/or consumption of any narcotic drug or psychotropic substance.
The Rules for the manufacture, use, import, export, and storage of hazardous micro-organisms/genetically engineered organisms or cells, 1989, notified under the Environment (Protection) Act, 1986 (1989 Rule) regulate Genetically Modified Organism and hazardous micro-organisms.
Personal Protective Equipment
There is no specific regulation for personal protective equipment. The Ministry of Textiles (MoT) released a detailed note on quality control protocol for PPE coveralls on 6 April 2020, followed by revised notes on 22 April 2020, and 5 May 2020. The products have to pass the test prescribed by the technical committee of the Ministry of Health & Family Welfare (the MoHFW).
In addition to the above, there are specific guidelines for various issues, for example, the conduct of clinical trials, market authorisation of biosimilars, rDNA research, ethics, the privacy of healthcare-related data, and biomedical research involving human participants.
The DC Act, the Cosmetics Rules, 2020 (the Cosmetics Rules), and the DC Rules regulate cosmetics.
Biocides or disinfectants are regulated under the DC Act and the DC Rules. The requirement of a sale licence is exempted. They are classified under Risk Class B under the MD Rules based on the intended use.
Food and nutrition supplements are regulated under the Food Safety and Standards Act, 2006, together with the Food Safety and Standards Rules, 2011, and various specific regulations made under the Food Safety and Standards Act, 2006.
The Indian Medical Council (Professional Conduct, Etiquette and Ethics) (Amendment) Regulations, 2020 regulate telemedicine.
The Information Technology Act, 2000 as amended by the IT (Amendment) Act 2008 (IT Act) and the Information Technology (Reasonable Security Practices and Procedures and Sensitive Personal Data or Information) Rules 2011 (IT Rules) regulate the collection, storage, and processing of personal data. The IT rules define the sensitive personal data or information (SPDI) of a person, which includes physical, physiological, mental health conditions and medical records and history. SPDI includes medical records and health data recorded by fitness trackers.
The Electronic Health Record Standards (EHRS) issued by the MoHFW provide for the standardisation as well as the homogeneity and interoperability in the capture, storage, transmission, and use of healthcare information across various health IT systems. They also regulate the storage of electronic health records. They specify requirements of healthcare data as a sector-specific add-on to the IT Rules. They acknowledge the popularity of self-care health devices that continually produce data and note that these also constitute essential healthcare data. However, these are recommendatory and are not legally binding.
According to the MD Rules, any software or app used with an instrument or an article for diagnosis, prevention, or monitoring of diseases/disorders may be classified as a medical device. All medical devices are regulated under the DC Act and the MD Rules.
In 2017, a nine-judge bench of the Supreme Court of India in Justice K S Puttasawamy and Anr. V Union of India in writ petition No 494 of 2012 ruled that the right to privacy is a fundamental right for Indian citizens under Article 21 of the Indian Constitution.
Cannabidiol (CBD)-based pharmaceuticals are regulated under the DC Act, the DC Rules, the NDPS Act, and the NDPS Rules.
Any food or beverage containing CBD is regulated under the Food Safety and Standards Act, 2006, the Food Safety and Standards Rules, 2011, and specific regulations made thereunder.
All "borderline" products are covered in the above sections.
The manufacture of any drug, Class A and Class B medical device, or cosmetic is subject to the grant of licence by the State Licensing Authority (the SLA). The manufacture of Class C and Class D medical devices is subject to the grant of a licence by the Central Licensing Authority (the CLA).
The DC Rules lay down the requirement of factory premises, plant, and equipment for manufacturing depending on the type of drug. These Rules lay down the requirement for the location, building condition (as per the Factories Act, 1948 (63 of 1948), water treatment system, the disposal of sewage and effluents (as per the Environment Pollution Control Board), and bio-medical waste (as per the Biomedical Waste (Management and Handling) Rules, 1996).
The DC Rules do not prescribe specific requirements of space and equipment for certain categories of drugs, such as medical devices and disinfectant fluids. In such cases, the concerned licensing authority has the discretion to modify the requirements laid under the DC Rules.
The MD Rules lay down requirements for the manufacture of medical devices for sale and distribution. These rules also stipulate a Quality Management System that a manufacturer is required to use.
The MD Rules stipulate that the manufacturer shall follow the essential principles regarding the safety and performance of medical devices as may be specified in the guidelines issued by the MoHFW. Furthermore, the medical device is required to conform to the standards laid down by the Bureau of Indian Standards Act, 1985 (BIS Act) or as may be notified by the MoHFW, from time to time. Where no relevant standard for a medical device has been laid down, it is required to conform to the standard laid down by the International Organisation for Standardisation (ISO) or the International Electro Technical Commission (IEC), or by any other pharmacopeial standards. If the standards have not been specified under any of the above two bodies, the device is required to conform to the validated manufacturer’s standards.
The Cosmetics Rules lay down requirements for the manufacture of cosmetics for sale and distribution. They require the applicant to furnish a self-declaration conforming compliance with Good Manufacturing Practices, requirements of premises, plants, and equipment for the manufacture of cosmetics as specified under the Rules. They also lay down conditions and requirements for building premises, staff, laboratory equipment, etc.
Corporate social responsibility (CSR) is mandatory under the Companies Act, 2013 for companies having a net worth of INR5 billion or more, or turnover of INR10 billion or more or a net profit of INR50 million or more during the immediately preceding financial year (the eligible companies).
The eligible company is required to constitute a CSR committee in the prescribed manner. The CSR committee is required to
The constitution of the CSR committee is not required if the amount to be spent by a company does not exceed INR5 million. In such cases the functions of the CSR committee are required to be discharged by the board.
The board is also required to ensure that the company spends, in every financial year, at least 2%of the average net profits made during the three immediately preceding financial years or, where the company has not completed the period of three financial years since its incorporation, during such immediately preceding financial years, in the pursuit of its CSR policy. Any unused amount is required to be transferred to a fund specified under the Act.
Activities that may be included in the CSR policies are those relating to improving health, education, sports, research and development, gender equality, ensuring environmental sustainability, protection of national heritage, art and culture, measures for the benefit of armed forces veterans, war widows, their dependents, contributions to publicly funded universities, laboratories researching sustainable development goals, disaster management and development of rural areas and slums.
The board is required to approve the CSR policy and disclose the contents of such policies in its report and also place it on the company's website, if any, in such manner as may be prescribed. The board is also required to ensure that the activities as are included in the CSR policy are undertaken by the company.
The non-compliance by any eligible company attracts a penalty prescribed under the Companies Act, 2013.
In addition to the CSR provisions under the Companies Act, 2013, the National Guidelines for Responsible Business Conduct (NGRBC), 2018 lay down principles for sustainable development goals (SDGs), and for including United Nations Guiding Principles on Business & Human Rights (UNGPs).
The DC Act, the DC Rules along with the Drugs and Magic Remedies (Objectionable Advertisements) Act, 1954 (DMR Act) and DMR Rules, 1977 (DMR Rules) regulate the advertising of medicinal products including drugs and medical devices.
The DMR Act prohibits advertisements for drugs and remedies that claim to have magical properties. The DMR Act prohibits the advertisement of any medical product (including medical devices) in a way that suggests, or is calculated to lead to the use of that device for:
The Uniform Code of Pharmaceuticals Marketing Practices (UCPMP) issued by the Department of Pharmaceuticals (DoP) also provides directions on suitable promotional materials for medical products.
The Indian advertising market is regulated and controlled by a non-statutory body, the Advertising Standards Council of India (ASCI). The ASCI – a non-profit organisation comprising media, advertising agencies, and advertisers – has published a Code for Self-Regulation in Advertising (ASCI Code) to regulate the publishing of advertisements in India, which applies to advertisements relating to drugs as well.
The Consumer Protection Act, 2019 (CP Act) seeks to protect the interest of consumers of goods and prohibits false advertisements by misrepresentations or false allurements, and provides penalties for misleading advertisements by manufacturers, sellers, service providers, celebrities endorsers.
The Indian Medical Council (Professional Conduct, Etiquette and Ethics) (Amendment) Regulations, 2020 prohibits Registered Medical Practitioners (RMPs) from advertising their services through any mode, including soliciting patients for telemedicine through any advertisements or inducements. The RMPs can only formally announce the details of practice and fees.
The market authorisation of a "new drug", an "investigational new drug", an "investigational new medical device" or a "new in vitro diagnostic medical device" is subject to the results of clinical trials or investigations or performance studies as the case may be.
A new drug is considered new for a period of four years from the date of its first approval and can be any of the following:
An investigational new drug is a new chemical or a biological entity or substance that has not been approved for marketing as a drug in any country.
An investigational medical device is a medical device that does not have its predicate device or a device which, after being authorised makes claims for a new intended use, a new user population, a new material or a major design change.
A new in vitro diagnostic medical device is any in vitro diagnostic medical device covered under the MD Rules, which has not been approved for manufacture for sale or import by the CLA and is being tested to establish its performance for the relevant analyte or other parameter related thereto including details of the technology and procedure required.
An application for conducting a clinical trial in respect of any of the above can be filed in a prescribed format with all the necessary documents and information before the CLA via an online licensing portal. The CLA is required to evaluate the application within the prescribed time.
The clinical trial can be initiated only after the approval of the trial protocol and other related documents by the Ethics Committee (EC). The EC for a particular trial site reviews and accords approval for the clinical trial, bioavailability or bio-equivalence protocol, and the related documents, and forward its report to the CLA. If, the EC rejects the protocol, the details of the same should be submitted to the CLA before seeking approval of another EC for conducting the clinical trial at the same site. The CLA is informed about the approval granted by the EC within the stipulated time of the grant of such approval. After scrutiny of the information and documents furnished with the application, the CLA may either grant permission to conduct the clinical trial or reject the application for reasons which are to be recorded in writing. The permission to initiate a clinical trial remains valid for two years from the date of its grant.
The MD Rules discusses two types of clinical investigations: a pilot study and a pivotal study. A pilot study is an exploratory study that is used to acquire specific essential information about a medical device before beginning the pivotal clinical investigation. A pivotal study is a confirmatory study to support the safety and effectiveness evaluation of the medical device for its intended use. For an investigational medical device developed in India, the applicant is required to conduct both pilot and pivotal studies in India.
Application for Market Authorisation
The market authorisation is subject to the approval of the licensing authority. The application with the prescribed fee and requisite information can be made via an online portal. The new drug application must be accompanied by detailed clinical trial data. For other types of drugs, the application must be accompanied by bio-equivalence and bio-availability studies.
An already approved drug or medical device with modified or new claims or a fixed-dose combination is treated as a new drug or an investigational medical device, respectively. In such cases, the application is required to be submitted with detailed clinical data.
The government has started various initiatives to strengthen the manufacturing sector in India, for example, "Make in India" and Atmanirbhar Bharat Abhiyan. The government has identified medical devices as a priority sector under the Make in India programme.
In 2017, a special regulation (the Medical Rules, 2017) was brought for regulating medical devices in India. The said regulation was further amended in 2020 (the MD Rules) to bring all types of medical devices within its scope. The government is also planning to set up a Medical Devices Authority (MDA) to regulate the medical devices sector.
In March 2020, the government notified two schemes, Production Linked Incentive (PLI) and Promotion of Medical Devices Parks. The PLI scheme aims to boost domestic manufacturing and attract large investment in the industry. The scheme has a total outlay of over INR34 billion. The Promotion of Medical Device Parks scheme aims to develop common infrastructure facilities (CIFs). The CIFs are expected to reduce the production cost of medical devices. The scheme has a total outlay of about INR4 billion.
To promote the export of drugs, the CDSCO has waived the No Objection Certificate (NOC) requirement from the MoFHW for the export of drugs.
In July 2020, the government also notified the PLI scheme for the promotion of domestic manufacturing of key starting materials (KSM), drug intermediates, and active pharmaceutical ingredients (APIs).
In March 2021, the DoP issued operational guidelines for the PLI to enhance the domestic manufacturing of pharmaceuticals, KSM, drug intermediates, biopharmaceutical ingredients, and in vitro medical devices.
The government has modified the foreign direct investment (FDI) regulations allowing 100% FDI under automatic route in greenfield and brownfield projects in the medical device sector.
In February 2020, the CDSCO and the US Food and Drug Administration entered into a memorandum of understanding (MoU) to promote access to high-quality, safe, effective and affordable medications for Indian and the US consumers.
Post-marketing Surveillance Obligations
The holder of the market authorisation for a new drug, an investigational new drug, or an investigational medical device is under an obligation to conduct post-market surveillance (PMS) or Phase IV clinical trials. The holder is required to submit the periodic safety update report (PSUR) as prescribed.
The DC Rules and the MD Rules mandate maintenance of records pertaining to sales, manufacture, batches, master formula, packing and processing, distribution, investigation, testing, and remedial action taken for drugs and medical devices.
In the case of telemedicine, it is mandatory for the RMP to maintain log or record, for example, phone logs, email records, chat/text record, video interaction logs, patient records, reports, documents, images, diagnostics, data, etc, (digital or non-digital) utilised in the telemedicine consultation. If a prescription is shared with the patient, the RMP is required to maintain the prescription records as required for in-person consultations.
The DC Rules, the MD Rules include provisions for product recall (drugs or medical devices) by the manufacturer, importer, or authorised agent as the case may be.
The CDSCO has issued detailed guidelines on the Recall and Rapid Alert System for Drugs (including biologicals and vaccines) for manufacturers, importers, stockists, distributors, retailers for both voluntary and statutory recall.
The following are the key regulatory authorities in respect of drugs and medical devices:
The key powers of the bodies discussed in 3.1 Regulatory Authorities are outlined below.
The CDSCO is the central drug authority. It is responsible for the implementation of the DC Acts and Rules made thereunder. It exercises regulatory control over the import of drugs, approval of new drugs and clinical trials, meetings of the Drugs Consultative Committee (DCC) and Drugs Technical Advisory Board (DTAB). It also acts as a CLA and co-ordinates the activities of SDCOs.
The SDCO of a particular state regulates the regulation of the manufacture, sale, and distribution of drugs, medical devices, and cosmetics at the state level. It monitors the quality of drugs, cosmetics, and medical devices in the concerned state. It also acts as an SLA.
The NCB regulates and implements the provisions of the NDPS Act.
The ICMR is the apex body for the formulation, co-ordination, and promotion of biomedical research
The DoP regulates various complex issues related to pricing and availability of medicines at affordable prices, research & development, protection of intellectual property rights, and international commitments related to the pharmaceutical sector which require integration of work with other Ministries.
The NPPA is responsible for monitoring, fixing, and revising the prices of drugs and medical devices, and enforcement of the provisions of the Drugs (Prices Control) Order, 2013
The RCGM is responsible for authorising the conduct of research and development, exchange of genetically engineered cell banks for research and development, and review of data up to pre-clinical evaluation.
The GEAC reviews applications and approval of activities where the final drug product contains genetically modified organisms/living modified organisms.
The DBT is responsible for administrating development and commercialisation in the field of modern biology and biotechnology.
The SBCC is responsible for inspecting, investigating, and taking punitive action in the case of violations of statutory provisions through the State Pollution Control Board (SPCB) or the Directorate of Health, etc.
The DLC is responsible at the district level for monitoring the safety regulations in installations engaged in the use of genetically modified organisms/ hazardous micro-organisms and their applications in the environment.
The IBSC is the nodal point for the implementation of the biosafety guidelines and the interactions within an institution.
The BIS is responsible for the harmonious development of the activities of standardisation, marking, and quality certification of goods and matters connected therewith or incidental thereto.
The FSSAI is responsible for food safety and regulation in India.
The NMC regulates medical education and medical professionals.
Adulterated, misbranded, spurious, or illegally distributed drugs, cosmetics, and medical devices are regulated under the DC Act and the Rules made thereunder. The manufacture for sale or distribution, selling, stocking, exhibiting, or offering for sale or distribution of such products is a penal offence punishable with imprisonment and/or a fine of varying degrees based on the seriousness of the offence.
With the recent amendments to the DC Rules, that came into effect on 1 March 2021, the marketer of the product is also responsible for quality and regulatory compliance. Manufacture of drugs based on controlled substances (narcotics) is also a penal offence and invites criminal prosecution under the NDPS Act. A patient can also initiate a product liability action against the manufacturer, the product seller, the product service provider (the opponent) under the CP Act. The remedies available include compensation, refund, replacement, repair or removal of the defect, withdrawal of the product from the market, etc. It also allows class action suits.
The manufacture, sale, etc, of a spurious or an adulterated drug amounts to grievous hurt under the Indian Penal Code (IPC). Accordingly, a criminal complaint may be filed at the relevant police station.
Not conforming with the standards prescribed under the BIS Act is also a penal offence punishable with imprisonment and/or a fine.
Other relevant laws or pieces of legislation include the Indian Contract Act, 1872, the Sale of Goods Act, and the law of tort.
The mechanism for suits is governed by the relevant legislations (please see 4.1 Product Safety Offences), the Code of Civil Procedure, 1908 (the CPC), and the Code of Criminal Procedure 1973 (CrPC) depending on the facts and circumstances of the case.
The jurisdiction of a court or a tribunal is determined based on pecuniary or fiscal value, geographical boundaries of a court, and the subject matter of the suit, and is primarily governed by the CPC and the CrPC, and specific legislations such as the CP Act, 2019, the DC Act.
Only criminal actions can be initiated under the DC Act for drugs (including medical devices) that are adulterated or spurious or not of standard quality. For any offence under the DC Act, only an Inspector, a Central/state government-authorised gazetted officer, the aggrieved person, or a recognised consumer association can move the court. Such an action can be brought before a Metropolitan Magistrate or a Judicial Magistrate of the first class, or a higher court. The aggrieved person may also approach the DCGI in the event they believe the medical device was not of standard quality or counterfeit.
Under the CP Act, three types of consumer court are involved, these are District Forums, The State Commission, and the National Commission. The jurisdiction of these courts depends on the pecuniary value of the goods or services paid as consideration.
For class actions under the CP Act, 2019, a complaint can be made to the Central Consumer Protection Authority, the District Collector, or the Commissioner of a Regional office regarding such violations, who are charged with the responsibility of protecting the rights of such consumers as a class.
Under the DC Act, the fine imposed on and released from, the person convicted under DC Act is paid by way of compensation, to the person or their relative or legal heir (in the case of death of an aggrieved person) who had used the adulterated, spurious, or low-quality drug or has suffered injury or death during a clinical trial.
The MD Rules provide for compensation to a subject of a clinical investigation in case of an injury or death during clinical investigation. Where an injury is caused to the participant in a clinical investigation of any investigational medical device, and such injury is attributable to the use of an investigational medical device, the sponsor shall provide to that participant, medical management and such compensation as is provided for in the DC Rules.
The CT Rules also provide for compensation to trial subjects in case of an adverse event. Furthermore, they prohibit the sponsor from limiting liability in respect of trial subject rights that have been specifically outlined in the Rules (for example, the obligation to provide free medical management or to pay compensation to a trial subject in the event of a serious adverse event). However, sponsors can contractually agree to limit liability on other issues with the consent of the trial subject. Sponsors can also enter into a contract with the contract research organisation (CRO) supervising the trial or the trial site where the trial is being conducted to require the CRO or the trial site to compensate the trial subjects or to indemnify the sponsor for compensation payments made by the sponsor.
A person, who is aggrieved by the order passed by a licensing authority may, within the stipulated time, appeal to the Central or a state government as the case may be. The said government may, after such inquiry into the matter as it considers necessary and after allowing the appellant to represent their views in the matter, pass such orders in relation thereto as it thinks fit.
The Parliamentary Standing Committee on Health and Family Welfare, in its 59th report, observed that some SLAs have issued manufacturing licences for several fixed dose combinations (FDCs) without prior clearance from the CDSCO. Consequently, the CDSCO after recommendation from expert committees prohibited the manufacture for sale and distribution of 349 FDCs in the public interest. The stakeholders filed writ petitions against the order of the CDSCO in various High Courts. In view of the said writ petitions, and Orders passed by the High Courts, the government filed a Special Leave Petition before the Supreme Court of India. The Supreme Court sent the matter to the Drug Technical Advisory Board (DTAB) to examine the matter and send a report to the government. The DTAB appointed a subcommittee to reassess the prohibited FDCs and give its recommendations. The Sub-committee recommended that 343 FDCs be prohibited and six be restricted or regulated. The government accordingly banned the said FDCs.
There are no examples of mass tort litigation in respect of the products listed in 1. Applicable Product Safety Regulatory Regimes.
The CPC provides that a representative action can be filed if numerous persons have the same interest in one suit. One or more of such persons may, with the permission of the court, sue or be sued, or may defend such suit, on behalf of, or for the benefit of, all persons so interested. The court may direct that one or more of such persons may sue or be sued, or may defend such suit, on behalf of, or for the benefit of, all persons so interested. The court, at the plaintiff’s expense, gives notice of the institution of the suit to all persons so interested. No part of the claim in any such suit is abandoned and no such suit is withdrawn, and no agreement, compromise, or satisfaction is recorded unless the court has given, at the plaintiff’s expense, notice to all interested parties. If any person suing or defending in any such suit does not proceed with due diligence in the suit or defence, the court may substitute in their place any other person having the same interest in the suit. A decree passed in the suit is binding on all persons on whose behalf, or for whose benefit, the suit is instituted, or defended.
The CP Act provides for the institution of a class action in accordance with the provisions of the CPC where numerous consumers have the same interest. The CP Act empowers the Central Consumer Protection Authority (CCPA) to protect, promote and enforce the rights of consumers as a class. Accordingly, the CCPA has the power to initiate a class action before the appropriate Consumer Commission.
Nestlé Maggi Noodles Case
The National Consumer Disputes Redressal Commission (NCDRC) filed a class action lawsuit against Nestlé India on behalf of Indian consumers under the Consumer Protection Act, 1986. The FSSAI issued an order asking Nestle to recall nine variants of Maggi noodles from the market. The case is still pending before the court. This was the first of its kind class action suit filed in India.
Johnson & Johnson Acetabular Surface Replacement Hip Implants Case
Johnson & Johnson (J&J) sold faulty ASR hip implants to approximately 4,700 Indian patients between 2004 and 2010. J&J announced a global recall of the ASR hip implants in 2010 and subsequently announced a settlement to cover the claims raised by US patients. In India, individual patients filed cases against the company before consumer courts. In 2017, the DCGI set up a committee of experts to probe the matter. This committee stated that J&J had published advertisements in two English language newspapers informing patients that it was effecting a recall of the ASR hip implants and would pay for the revision surgery of those patients who required the implant replaced. Over 1,000 Indian patients contacted the company in response to these advertisements. The remaining patients were not even likely to be aware of this as J&J did not contact each patient individually. In 2018, an expert committee under Dr R.K. Arya recommended that J&J be ordered to pay each patient a baseline level of compensation and additional compensation based on the age of the patient and the disability suffered by them. The DCGI ordered J&J to pay compensation accordingly. The order of the DCGI was challenged before the Delhi High Court on 8 April 2019, which ordered J&J to pay compensation to the affected patients. A petition was also filed at the Supreme Court of India seeking action against J&J. The Supreme Court closed the case, saying that steps had been taken by the government to provide compensation to the patients.
The Arbitration and Conciliation Act, 1996 governs the law relating to domestic arbitration, international commercial arbitration, and enforcement of foreign arbitral awards. It also defines the law relating to conciliation and for matters connected therewith or incidental thereto. The Act also recognises mediation. It is based on the United Nations Commission on International Trade Law (UNCITRAL).
The Indian Courts also promote ADR. The CPC also includes provisions for ADR. The Supreme Court of India has laid down guidelines for the effective implementation of the relevant provisions of the CPC in this regard. The various High Courts have issued their own set of rules for mediation.
The Commercial Courts Act 2015 (as amended) makes it mandatory for parties to exhaust the remedy of pre-institution mediation under the Act before instituting a suit.
Under the CPA, 2019 Act, the parties can avail themselves of the services of a mediator for dispute adjudication where it is deemed reasonable.
The CP Act provides for certain exceptions to product liability actions. These exceptions are that:
A product manufacturer shall also not be liable for failure to instruct or warn about a danger which is obvious or commonly known to the user or consumer of their product or which such a user or consumer ought to have known, taking into account the characteristics of the product.
Demonstration of regulatory compliance may reduce liability; however, the extent of it will depend on the facts and circumstances of each case.
A Draft Notification “Environmental Standards for Bulk Drug and Formulation (Pharmaceutical) Industry” has been issued and draft Environment (Protection) Amendment Rules, 2019 have been proposed to limit the residues of 121 antibiotics and other toxins in the effluents discharged by pharmaceutical factories.
The draft Plastic Waste Management (Amendment) Rules, 2021, which propose a ban on some single-use plastic items, are under consideration.
In July 2021, the Environment ministry exempted drug manufacturers from stringent environmental clearance processes till 31 December 2021. Under this notification, all such proposals will be evaluated for accelerated green clearances by putting activities relating to API under B2 category projects. Since projects in the B2 category do not require environmental impact assessments (EIA) and public hearings, drug manufacturers can get accelerated green clearance.
Please also see 5.2 Legislative Reform.
The Draft Rules on Sale of Drugs by E-pharmacy, 2018 for the regulation of e-pharmacies have been issued.
The Personal Data Protection Bill, 2019 is currently under consideration. It seeks to regulate the use of a person’s data by the government and private companies.
The Medical Devices (Safety, Effectiveness, and Innovation, on) Bill, 2019 is currently under consideration. It aims to provide an improved regulatory framework for medical devices.
The FSSAI, in October 2020, issued a draft regulation on the amendment in standards of several food products including foods and beverages containing CBD.
The Drugs and Magic Remedies (Objectionable Advertisements) (Amendment) Bill, 2020 is currently under consideration. The bill proposes to amend the DMR Act to keep up with changing times and technology. The bill expands the definition of “advertisement”. It also defines the penalty for contraventions. It also brings Ayurvedic, Siddha, and Unani drugs into its ambit. It also covers additional diseases and health conditions.
The MoHFW has constituted a committee to reform the Drug Regulatory System so that the approval process can be fast-tracked.
Also, please see 5.1 Policy Development.
As of now, there are no changes in the regulatory regime discussed throughout this chapter due to Brexit.
The government, the CDSCO and other bodies issued various notices and guidelines to expedite the approval of COVID-19 drugs, diagnostic kits, and vaccines. For example, emergency approvals for COVID 19 vaccines, Covishield, Covaxin, ZyCoV-D, and Sputnik were granted subject to terms and conditions. Restricted emergency use and manufacture approvals were granted to Remdesivir, Favipiravir, and 2-deoxy-D-glucose (2-DG).
Manufacturers of industrial oxygen were allowed to manufacture oxygen for medical use subject to conditions.
Processing of the applications to manufacture hand sanitiser was done in three working days. The hand sanitisers were exempted from the requirement of a sales licence.
The validity of WHO Good Manufacturing Practice and Certificates of Pharmaceutical Products expiring from March to August 2020 were extended.
Prior permission from the CLA for manufacturing and stocking a vaccine for COVID-19 was deferred.
Draft New Drugs and Clinical Trials (Amendment) Rules, 2020 were issued for compassionate use of any new unapproved drug.
The validity of the registration certificates or licences for import of drugs that were due to expire were extended subject to conditions.
Special conditions, under which the permission for import of drugs with a residual shelf life of less than 60% was to be allowed/extended, were specified.
A set of regulations were issued to allow for certain norms to be relaxed thus aiding the import and export of COVID-19 vaccines through courier services.
Submission of the applications for import registration for drugs, cosmetics, and medical devices with self-attested documents were allowed subject to conditions.
In April 2021, the government issued detailed guidelines and relaxed the conditions for the entry of foreign-made COVID-19 vaccines approved by the US FDA, the EMA, the UK's MHRA and Japan's PMDA, as well as the WHO's Emergency Use Listing, into India. Specifically, for such vaccines, the requirement of conducting post-approval bridging clinical trials and the requirement of testing of every batch of the vaccine by the Central Drugs Laboratory (CDL) is exempted if the vaccine batch has been certified and released by the National Control Laboratory of the country of origin. Subsequently, Cipla was granted approval to import Moderna’s mRNA technology-based COVID-19 vaccine for emergency use.
In May 2021, the MoHFW issued guidelines on Liberalised Pricing and Accelerated National COVID-19 Vaccination Strategy which aims at liberalised vaccine pricing and scaling up of vaccine coverage.
In March 2020, the MoT set up an Emergency Control Room to monitor production and supply of medical textiles (N-95 masks, body coveralls and melt blown fabric). The MoT also released notes on the quality control protocols for PPE. The MoHFW also prescribed tests for PPE coveralls. (See 1.1 Medical Devices)
The government is considering indemnity for COVID-19 vaccine manufacturers such as the Serum Institute of India, Moderna and Pfizer.
The Current Situation and Emerging Opportunities in India for Medical Devices and Consumer Healthcare Products
One of India's leading revenue earners, the healthcare business is also one of the country's fastest-growing sources of employment. Hospitals, medical devices, clinical trials, outsourcing, telehealth, health insurance, and diagnostic supplies are just a few examples of healthcare-related services. When healthcare is discussed, it can encompass any type of hospital, medical device, treatment programme, clinical studies, outsourcing, telemedicine, medical care, medical insurance, and diagnostic supplies. Several recent developments, including widening potential, additional services, and increasing public and private sector investment, are supporting the Indian healthcare market's growth. As far as healthcare in India is concerned, everyone already has it. In most cases, state governments administer this model. Furthermore, according to the Indian Constitution, the responsibility for providing healthcare for the industrial sector lies with the states.
The Indian healthcare industry is on the rise, thanks to technological advances in healthcare and services, as well as increased governmental and private spending. This, combined with India's existing high employment levels, accounts for 15% of GDP and more than 40% of overall job generation in the country. However, the need for surveillance of the COVID-19 outbreak has overwhelmed even existing health services, demanding a reassessment of India's healthcare system. Both the business and public sectors have partnered to combat the pandemic, and a wide range of responses have been observed.
In India, hospital systems are divided into two categories: public and private. The public healthcare system includes primary healthcare facilities (ie, clinics) in large cities, as well as additional facilities that meet the needs of under-resourced rural areas by providing alternate venues for secondary and tertiary care services. The private sector is the primary provider of services in metropolitan areas. The National Health Policy was adopted by the Indian Parliament in 1983, and it was updated in 2002 and again in 2017. The increasing prevalence of non-contagious diseases is resulting in an increase in hospital spending on treatment and research. So far, government healthcare policies have had the greatest impact on the growth of private-sector healthcare providers. Ayushman Bharat, the Indian government's healthcare project, commenced operations in 2018 and is still expanding.
The healthcare and medical devices sector in India
The Indian healthcare industry provides health treatment to approximately one and a half billion people in India. The supply of medical devices for use in the home is increasing due to the significant growth in the number of patients with chronic diseases. A significant advantage of having medical equipment and wearables at home is that users have more options for monitoring their vital signs and can be more comfortable with the results. While this demand remains high, consumers are increasingly looking for medical devices that can be used at home. Following the COVID-19 disease outbreak, many new concerns have arisen, particularly for those with other health conditions. People prefer to have their health monitored at home to the need for continuous monitoring in public healthcare settings. Caregivers and patients are able to better protect themselves from infection by lowering the risk to which they are exposed by practising self-monitoring at home. This makes home healthcare safer. Remote monitoring technology that combines the online world and mobile devices has now become available in more modern medical devices. A healthcare professional can provide healthcare coverage for their patients without visiting an institution such as a healthcare facility. Medical devices will continue to be important even after the global epidemic has been contained and the situation has returned to normal. Even where there are no physical healthcare facilities, each geographical area will have consistent and high-quality healthcare.
The medical device industry employs a unique approach to integrating engineering and medical practice. The biomechanics process aims to facilitate the development of machines that can support life within the human body. Ventilators, cardiac imaging machines, CT scans, X-rays, molecular imaging, MRI, and ultrasound scanners are examples. For various functions, medical devices employ disciplines such as engineering, electronics, material science, and information technology. However, it should be noted that the medical devices industry in India is not as essential as it could be, in contrast to other industrial sectors. With a total estimated value of USD15 billion, approximately USD11 billion worth of medical devices from other countries are imported into India every year, almost all of which are unregulated for quality and safety. By 2022, the healthcare industry might triple in size, perhaps reaching INR8.6 trillion (USD133.44 billion). India's public expenditure on healthcare as a percentage of GDP was 1.2% in Budget 2021. An expanding middle class and an increase in the incidence of infectious diseases have been driving up the importance of health insurance. As the demand for low-cost, high-quality healthcare starts to grow, the health insurance market is anticipated to rise in the coming years. Gross written premiums in the health industry increased 13.7% in FY21, reaching approximately INR590 billion (USD8 billion). The health industry accounts for 29.5% of total gross written premiums in the country.
Some regulatory developments
In July 2020, a more stringent and effective set of rules were enacted for Indian consumers, leading to the repeal of the Consumer Protection Act of 1986. Before the passage of the Consumer Protection Act of 2019, product liability was not fully addressed. The Consumer Protection Act of 1986, the Drugs and Cosmetics Act of 1945, the Sale of Goods Act of 1930, as well as the Indian Contract Act of 1872, are some of the heretofore enforceable product liability laws. Under the new Act, manufacturers, sellers, and providers are all subject to liability for those affected by defective services and products. Other significant developments include the shift to online shopping, stricter penalties for false advertisements, and restrictions on celebrity endorsements. Businesses must maintain conformance to prevent medical malpractice claims. This will influence the types of insurance that businesses should carry.
The Medical Equipment Rules, 2017, went into effect in India on 1 January 2018. The medical device regulations (MDR) give the federal government the authority to issue a "warning" for specific types of medical devices, effectively classifying those devices as "drugs" under the scope of the regulations. The government left unregulated medical devices alone.
Normally, only a few devices are contacted at once. While the Ministry of Health and Family Welfare did not notify all medical devices that could be broadly defined as "medical devices," such devices started to be notified on 1 April 2020. As a result, Section IIIA of the MDR was added, which states that all medical devices should be registered with the Drugs Controller General of India via an online platform by 1 October 2021. The device would benefit from regulatory exemptions from key elements of the MDR if it acquired provisional registration (including clinical investigation, clinical performance evaluation, import, manufacture, sale, and quality control requirements). That is, if they do not register their devices by 1 April 2020, all unregistered medical devices will be subject to all MDR regulations and will be treated as if they were registered (before the amendments).
Manufacturers and importers will be required to declare the type of medical device from the time of registration (Class A to D). However, newly notified devices do not yet have a registration portal set up for them. This is because of the delays caused by COVID-19. Companies had to wait until 1 April 2020, to apply for provisional registration for their devices, which meant that revisions to their devices were delayed. In September 2020, the Central Drugs Standard Control Organisation (CDSCO) announced proposal classifications for 1,866 newly notified medical devices and 80 in vitro diagnostic devices as a first step toward making the online registration system easier. Furthermore, device classification is now regulated and standardised on an international scale. Spectacles (frames and lenses), contact lenses, and public respirator masks (2 and 3 ply) are all commonly used medical devices, and thus must be regulated as such.
Initiatives by the government
The Indian government has introduced several significant initiatives to help the Indian healthcare industry grow, including the following.
Emerging opportunities in the medical device sector in India
In India's medical equipment industry, an exciting new opportunity has emerged. Most modern medical devices used in India today are imported from other countries, with China serving as the primary source. With a total market value of approximately USD11 billion, India ranks 19th among the world's medical device markets. This industry is expected to grow to USD50 billion in the next five years because of several government initiatives, including the Ayushman Bharat initiative, which aims to provide affordable healthcare to all citizens. According to World Bank data, India has the fourth-largest Asian market, trailing only Japan, China, and South Korea, with a potential rate of growth of 28%.
With the government's demand for self-sufficiency and the COVID-19 ban in place, India has created new opportunities for a wide range of businesses, including medical device manufacturing. The market is currently growing at an 18% annual rate, and it is expected to reach USD100 billion within the next two to three years. Because of the current market dynamics, Indian manufacturers are in an excellent place to start producing medical devices.
The Indian government's think tank, Niti Aayog, has created a roadmap to promote medical equipment manufacturers in India. The government has also permitted 100% FDI in medical product manufacturing companies under an automatic procedure. The Indian government has devised plans to remove all barriers to investment and to provide tailor-made solutions to transform India into a medical device manufacturing hub. The medical device manufacturing industry includes patient aids, dental products, MRI machines, prostheses, and disposal and consumables.
Medical device manufacturing parks are part of initiatives such as "Make in India", and some states have been granted permission by the Indian government to build them. Six medical device manufacturing clusters will be established in states such as Andhra Pradesh, Kerala, Telangana, Tamil Nadu, Maharashtra, and Sikkim. Domestic medical device manufacturing will be able to produce more sophisticated and higher-end medical devices at a lower cost, while also creating new jobs, thanks to these clusters. The ongoing crisis has demonstrated the country's ability to increase manufacturing to meet increased demand for PPE kits, ventilators, and other life-saving equipment. However, to transition the country from a medical equipment manufacturer to a medical equipment manufacturing hub, additional challenges must be overcome. To facilitate international trade, component inputs used in the manufacture of medical equipment in India must also be streamlined. One positive effect of the government offering tax breaks to medical equipment manufacturers would be to stimulate the growth of these companies in the country.
Healthcare growth in India is expected to accelerate in the post-pandemic era. The Indian government's Ayushman programme has aided in the provision of healthcare to the country's underprivileged. The underprivileged now have equal access to care regardless of their financial situation. Many more projects like this will allow healthcare providers to establish a stronger presence in rural areas. The Indian government is also working on new sustainable development goals (SDGs) for the coming decade. Its purpose is to assist those who are less fortunate, improve public health, and maintain societal harmony. Its mission is to eliminate malnutrition in people of all ages while also promoting the availability of safe drinking water, adequate sanitation, and proper hygiene. The healthcare system faces numerous challenges and opportunities, but it is well-positioned for achievement thanks to government initiatives.
A large country like India provides a plethora of opportunities for medical device companies. As a result of excessive capital investment in advanced diagnostic facilities, the country has now emerged as a significant destination for more expensive diagnostic services for a broader range of people. Furthermore, Indians who use medical services are more concerned about their overall health. Because the Indian healthcare market is so diverse, there are numerous opportunities for providers, payers, and medical technology. As firm competition grows, many companies are looking for new dynamics and trends to help their businesses. The hospital business in India is expected to grow at a CAGR of 16–17% from USD61.79 billion in FY17 to USD132.84 billion in FY22. The Indian government intends to increase public health spending to 2.5% of GDP by 2025 as part of its long-term healthcare strategy. Furthermore, the country provides numerous opportunities for research and development as well as medical tourism. Finally, both urban and rural India offer exceptional investment opportunities in healthcare infrastructure.