Tag Archives: Ranbaxy Laboratories

Let’s set a global drug quality benchmark The crisis in Indian pharma is a chance to develop a new regulatory path


With Indian-made generics accounting for a US market share of over 25 per cent, it is not surprising that it is gaining significant mindshare of the American drug regulator, the Food and Drug Administration (FDA).

The spate of quality issues with leading Indian pharmaceutical companies in the past couple of years, however, should not be viewed in isolation.

Big Pharma in the West, too, has been facing increasing flak from the FDA and other regulators over good manufacturing practice violations. High profile names such as J&J, Genzyme (Sanofi), GSK, Sandoz, Watson, Teva and many others have encountered their share of quality problems and have been served with ‘warning letters’ from the FDA.

The real issue is of quality medication, and how we can ensure that every tablet or dose whether for home or overseas markets is of the highest quality. This is important since India has already taken its place at the high table of the global generics market with around $15 billion in exports expected to increase to $20 billion by 2020.

It is widely accepted that instances of good manufacturing practices (GMP) violations stem from negligence. This makes it vital for Indian companies to put in place checks and balances to prevent such slip-ups. While it is true that we have a crisis at hand, I do not believe that there will be any sustained damage as Indian companies can swiftly take corrective action and regain their reputation as a quality producer of affordable generics to global markets. This could even be an opportunity to create a quality benchmark for others to emulate.

Understanding Non-compliance
Non-compliance is not new to the global pharmaceuticals industry. It is due in part to the stringent and diverse regulations across markets that require compliance. The FDA is a highly vigilant regulator that relentlessly pursues non-compliance action against a large number of companies in the US as well as all over the world.

Given our fast growing share of the US generics market, the FDA has naturally been conducting inspections in India more assiduously and frequently. This has resulted in several notices being issued to Indian companies almost concurrently. Compounding this is the hefty fine levied on Ranbaxy for a past breach in compliance. The unfortunate impression it has created is that non-compliance is pandemic in the Indian drug industry

What Ails Indian Pharma
There are several factors that have led to this crisis in the Indian pharmaceuticals industry. One is that there are too many regulators and policy makers. Regulation and policy is governed by the ministries of health as well as chemicals and fertilisers.

For biopharmaceutical companies, in addition to these, there is the Department of Biotechnology and the Ministry of Environment. Manufacturers, thus, have to comply with overlapping, and at times contradictory directives, from three different departments. At the policy-making level, a single ministry for the pharmaceuticals sector is one way forward.

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The start can be made with biologicals and biosimilars by expediting the long-awaited Biotechnology Regulatory Authority of India under the Department of Biotechnology. Biosimilars, or biogenerics, particularly need to be regulated by a separate group within the regulatory system.

Take, for instance, the two to four-year timeline for pharmaceutical generics at a cost of $1 million to $2 million per Abbreviated New Drug Application (ANDA). In the case of biogenerics, which present the next big growth opportunity, regulatory barriers are steep and time to market is five to eight years at a steep price of $50 million to $75 million per ANDA-equivalent.

Another concern is the dual quality of drugs. The International Conference on Harmonisation of Technical Requirements for Registration of Pharmaceuticals for Human Use (ICH) guidelines mandate a much higher quality level for generics than the innovator products, which then adds to the cost.

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Emerging markets, on the other hand, require quality specifications to match those of the innovator, which is what causes the criticism. In any case, so long as the drug meets the quality norm of the market in which it is sold, that should not be a serious concern.

Finally, there is a huge gap between small and large pharmaceutical companies based on quality testing and automation in manufacturing infrastructure. This by itself creates quality issues and it is vital to ensure that we bring pharmaceutical manufacturers, irrespective of size, under the ambit of common quality standards.

Watchdog that Barks – and Bites
While the industry needs to heed the writing on the wall, there is much that government can do to redress the situation. To start with, we need uncompromising regulation along the lines of the US FDA. Existing regulation is completely derelict both at the central and state levels. The issuing of manufacturing licenses should be strictly regulated and the frequency of spot audits stepped up along with severe penalties for non-compliance.

Mere training workshops, which are the norm, will not suffice to upgrade the competence levels of regulators. Rigorous training programs for regulators of at least one year should be instituted and made compulsory. It is important that approval and regulation be conducted by people who thoroughly understand compliance requirements including quality, efficacy, immunogenicity and GMP – not just the quality standards handbook. Clearly, the government needs to look beyond the rank and file of its technocracy to induct experts with wider exposure to manufacturing and compliance for key regulatory and approvals positions.

Bottom Line
While there is much that the industry can contribute in terms of self-regulation, the government needs to sit up and notice that this poorly but over-regulated sector needs much more support than information technology, which enjoys virtually no regulation. Instead, it has saddled the pharmaceutical sector with an unfair tax structure, control prices and denied much-needed tax incentives for R&D, overseas development and international patents. The sector needs investment to upgrade infrastructure and expertise – and the government must act now to provide the enabling framework and policies.

For all the challenges however, I believe this crisis is a huge opportunity to develop a new regulatory path that others will follow. But to do that we must first earn the credibility of the outside world. The first step forward would be to evolve — one with a global standards quality framework and implemented it with zero-tolerance regulation.

Integrity is vital in the health-care business: Swati A. Piramal

Swati A. Piramal, Vice Chairperson, Piramal Enterprises

After the recent US Food and Drug Administration (FDA) episode involving Ranbaxy, there is a general apprehension that Indian-made medicines and drugs are sub-standard and that middle-class India is buying and consuming drugs that are questionable in quality. In fact, parents of young children are reluctant to give any drugs to them, fearing that they are sub-standard.

For Piramal Healthcare, quality manufacturing and operational excellence is critical for the safety of patients taking medicines made in our plants. I recall asking my Quality Control Group whether we could face FDA complaints. The clear answer was, “It is highly unlikely.” The team cited the multiple times the US FDA and other agencies such as the UK-MHRA (Medicines and Healthcare products Regulatory Agency), have inspected our plant at Pithampur (in Madhya Pradesh) and our Digwal plant near Hyderabad. They recalled the tremendous effort and investment that was made to get them to US FDA standards. We are also audited by our customers, which comprise large pharmaceutical companies, several times a year.

What is important about maintaining the highest quality standards and the highest integrity? It is the ethical culture of the organisation, independent reporting of quality, investment in continuous improvement, training of staff, and getting the values imbibed in each employee, even the lowest in the line function.

In our company, the ethical culture deeply pervades the organisation. The active whistleblower policy goes directly to the board, which goes into great details, on any complaints. The quality operations function reports directly to the Executive Director, and not to any line manager, who is responsible for sales and profits. The quality operation is, therefore, totally autonomous and independent.

The quality standards of global regulators are a constantly moving bar. They change every year and, therefore, education of personnel on continuous improvement, adhering to new standards and training are critical. We have a robust system of training and audits conducted by both internal and external experts. Of course, zero error is difficult to achieve. But it is a mighty goal in the search for excellence.

Integrity is vital in any health-care business, where we are saving lives when patients use our medicines. At Piramal, workers, even at the lowest level, are involved in continuous improvement. Operational excellence is rewarded. At 14 Piramal plants, from where products are exported to over 100 countries, many foreign regulators visit frequently. The quality team takes pride in having no major deficiencies or warning letters in the US FDA audit system. Workers are encouraged to report aberrations and deviations promptly. Such an open culture helps to quickly identify issues, and is less costly, in the long run.



Project revital India’s drug regulator is getting a makeover but better enforcement and safer medicines are yet a chimera.


Is everything in order in Indian pharma industry?

India’s pharmaceutical industry suffered twin blows recently when Ranbaxy Laboratories and Wockhardt, two of the country’s biggest drug makers, came under fire from US authorities. While Ranbaxy on May 13 admitted to fudging data , Wockhardt said on May 24 the US drug regulator had banned imports of medicines from one of its factories near Aurangabad in Maharashtra.

The incidents raise some pertinent questions: is everything in order in the Indian pharmaceutical industry? Are drug makers maintaining quality standards? And what are Indian authorities doing to ensure the medicines we consume are safe?

“We need to tighten our domestic laws and have a quality culture so short cuts are avoided and there is proper documentation,” says Kewal Handa, a former managing director at Pfizer India who now runs healthcare advisory firm Salus Lifecare. “One never hears of such stringent penalties in India ,” he adds, referring to the $500 million Ranbaxy agreed to pay to settle cases in the US .

G.N. Singh, Drug Controller, General of India
By 2017, you will see a totally different regulatory regime where we have a more systemoriented and sciencebased evaluation: G.N. Singh

Ranjit Shahani, Vice Chairman and Managing Director at Novartis India, agrees the government must come down heavily on companies that do not follow regulations. “The Indian government clearly has to allocate significant resources speedily to controlling quality. Incremental change will not make any difference,” says Shahani, who is also President of the Organisation of Pharmaceutical Producers of India, a group of global drug makers.

Such incidents “tarnish India’s image”, says Kiran Karnik, former president of the National Association of Software and Services Companies. Karnik has been tracking and writing on the subject of public health, among other areas, after his stint at NASSCOM.

The Indian drug landscape comprises two worlds. One world is relatively safe where companies such as Ranbaxy and Wockhardt, despite their weaknesses, meet stringent US and European regulations. According to the Drug Controller General of India (DCGI), there are 169 plants in the country approved by the US Food and Drug Administration (FDA).

Besides, 160 facilities are approved by European regulators and about 1,300 are certified by the World Health Organisation. The other world is a mix of players of different sizes with many of them small and escaping strict monitoring because regulatory agencies are under-staffed and under-equipped. Overall, the DCGI estimates there are about 8,000 manufacturing units across the country. Industry estimates put the number as high as 20,000 units.

A close look at the Indian pharmaceutical industry shows a complicated regulatory structure and a web of entities at the central and state levels tasked with monitoring the sector. Drug companies come under the purview of the chemicals and fertiliser ministry. The Central Drug Standards Control Organisation (CDSCO), the top industry regulator (see Between Many Stools) headed by the DCGI, comes under the health ministry. There is a separate agency for monitoring food products, the Food Safety and Standards Authority of India. In contrast, in the US, almost everything that goes into the human
body is regulated by the FDA.

In May 2012, a parliamentary standing committee report on the functioning of the Central Drugs Standard Control Organisation (CDSCO) pointed out that it was facing a severe staff shortage. It noted that, as of October 2011, only 124 of 327 sanctioned posts were occupied. The organisation’s headquarters was staffed by four deputy drug controllers and five assistant drug controllers.

These nine officers together handle 20,000 applications, attend more than 200 meetings, and respond to 700 parliament questions and about 150 court cases annually. That has changed in the past year, says DCGI G.N. Singh. “It is not nine officers now but 200,” he told Business Today. Singh said a total of Rs 3,500 crore would be spent on expanding the regulatory agencies in the five years to 2017. Of this, Rs 1,500 crore has been earmarked for strengthening the central regulator and a similar amount for state-level agencies. “By 2017, you will see a totally different regulatory regime where we have a more system-oriented and science-based evaluation,” he adds.

According to last year’s parliamentary report, the main problems are inadequate infrastructure, shortage of drug inspectors and lack of accurate data. The panel said a 2003 report by a group led by R.A. Mashelkar estimated a requirement of more than 3,200 drug inspectors.

Piramal Enterprises’s bulk drugs unit at Digwal village, about 100 km from Hyderabad, has had four US FDA inspections in the past decade. The company claims it has never had any adverse comments. Business Today visited the plant to see how the company ensures it meets FDA standards. The company maintains log books in the quality control laboratory where samples of the material produced are analysed before dispatch. In the documents section, there is a constant check on temperature as samples from each batch of production are stored there.

In the raw material warehouse, the focus is on labelling and ensuring clear identification of incompatible and hazardous raw material. During FDA inspections, the bulk drugs units are usually asked to show a complete manufacturing step conforming to the required quality systems. In the finished product area, the focus is on the particle size of ingredients based on required dosage and customer needs.

The panel said there were only 846 drugs inspectors against 1,349 sanctioned posts in states. Singh says the number of drug inspectors has now risen to about 1,200 and will cross 3,000 by 2017.

Singh denies the staff shortage has hampered regulatory work. “We are also good now and that is why the share of substandard drugs being sold in the Indian market is down from 10 per cent in 2002 to between four and 4.5 per cent today.”

Industry executives disagree. “The share of spurious drugs being sold in India may be over 20 per cent in India,” says Tobby Simon, founder and President, Synergia Foundation, a Bangalore-based applied research think tank. He adds the WHO estimate of the value of counterfeit drugs globally would be about $140 billion this year and could touch over $200 billion by 2020.

Two recent incidents indicate the severity of the situation. In April, a scandal involving purchase of spurious medicines by a government-appointed committee came to light in Jammu and Kashmir. On May 6, shops, other businesses, public transport and educational institutions remained closed in Srinagar to protest against fake drugs. Again, in April, the Gujarat Food and Drug Control Administration (FDCA) busted a racket of illegal manufacturing and sale of spurious drugs in Ahmedabad. Last year, the FDCA launched a system that notifies all chemists and druggists of recalled fake or substandard drugs through text messages. Other states are keen to implement a similar system.

Laboratory testing of samples is another big issue. At present, drug inspectors pick samples randomly to check for quality or following a complaint from a consumer. These samples are then sent to state laboratories for testing, and manufacturers asked for an explanation in case of an adverse report. Singh says about 50,000 drug samples are tested annually across the country. He says the aim is to enhance this number five to six times by 2017 and also to ensure quicker turnaround time.

Currently, it takes five to six months to get the final sample report. “We will have a fast-track system, and mobile labs equipped not only with modern equipment but also with trained manpower,” he says. The government is also planning to use the expertise of organisations such as the Centre for Cellular and Molecular Biology and the Indian Institute of Chemical Technology, both in Hyderabad, for this exercise.

Are these measures enough? No, say industry executives. The government’s main focus appears to be on controlling drug prices as part of its social welfare agenda. While price control benefits consumers, it may also encourage companies to cut corners.

Industry executives say that, as FDA-approved plants cannot match the prices of drugs made in non-certified units, many top companies do not take part in tenders that government hospitals and some large government organisations call for drugs supply, since the selection yardstick is the lowest price. Howsoever stringent, external supervision alone cannot tackle all problems the pharmaceutical industry is facing. The government and industry should encourage corporate executives as well as government officials to disclose wrongdoings in their organisations. “The government has had a whistleblower policy for the last two years with a reward of Rs 25 lakh for the whistleblower,” says Shahani of Novartis. “Have you heard of any whistleblower?”