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Thousands of Indian Pharma Units Risk Closure as Schedule M Deadline Looms; Industry Seeks Extension

Despite the industry's appeals, the government has yet to announce any leniency on the compliance timeline. Officials have indicated that inspections and audits of manufacturing facilities will begin soon, and non-compliant units will face strict regulatory action.

• By Newsdesk
• New Delhi
• Jan 04, 2025

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India's pharmaceutical sector is grappling with an impending crisis as the January 1, 2025, deadline to comply with the revised Schedule M of the Drugs and Cosmetics Act draws near. This regulation, introduced by the Ministry of Health and Family Welfare in January 2024, mandates stringent manufacturing and quality control standards for drug production.

Industry representatives warn that nearly half of India’s 10,000 pharmaceutical manufacturing units may fail to meet the updated guidelines, with up to 5,000 facilities facing the threat of shutdown. Only about 2,000 units currently comply with Good Manufacturing Practices (GMP), while another 3,000 are actively working to upgrade their infrastructure and systems to align with the revised standards.

The remaining 5,000 units, however, are yet to make significant progress, citing financial and operational constraints. With the deadline fast approaching, the pharmaceutical industry has called for a two-year extension to facilitate the necessary upgrades, including procurement of new machinery, facility enhancements, and staff training.

Government Audits and Inspections Expected

Despite the industry's appeals, the government has yet to announce any leniency on the compliance timeline. Officials have indicated that inspections and audits of manufacturing facilities will begin soon, and non-compliant units will face strict regulatory action.

The revised Schedule M aims to elevate India’s pharmaceutical sector to global standards, incorporating measures such as annual product quality reviews, enhanced risk management protocols, and robust quality management systems. These updates are designed to ensure the consistent production of high-quality drugs and bolster the country's reputation in international markets.

MSMEs Particularly Vulnerable

Micro, small, and medium enterprises (MSMEs) are likely to bear the brunt of the new regulations. Industry leaders have emphasized that smaller manufacturers face unique challenges, including difficulties in securing financing and delays in machinery procurement. These hurdles are further compounded by the time-intensive processes of staff training and validation of new equipment.

Recognizing these challenges, the Department of Pharmaceuticals (DoP) has introduced schemes to support MSMEs in meeting compliance requirements. These initiatives provide financial aid for upgrading utilities, testing labs, stability chambers, and production facilities. Former DoP Secretary Arunish Chawla highlighted that several companies have availed of these schemes, with some already receiving assistance following gap analyses and technical committee reviews.

Industry Urges for More Time

While government schemes have offered some relief, industry stakeholders argue that the current timeline is insufficient. They have requested an extension until December 2026 to fully implement the necessary changes.

During discussions with the health minister, industry representatives outlined their concerns, including supply chain delays and the high costs of upgrading infrastructure. The health ministry has acknowledged these challenges and sought detailed reports from the DoP on measures to assist the sector. However, no formal decision on extending the deadline has been announced.

As the clock ticks closer to the deadline, the pharmaceutical industry remains in a race against time, striving to meet the new standards while awaiting a possible reprieve from the government. Failure to act could jeopardize thousands of businesses and disrupt the production of essential medicines, a prospect that could have far-reaching implications for the nation’s healthcare ecosystem.