Last Updated on October 5, 2020 by The Health Master
The Indian Drug Manufacturers’ Association (IDMA) has appealed to the Central Drugs Standard Control Organisation (CDSCO) to amend Section 19(3) of Drugs and Cosmetics Act, 1940 to incorporate term ‘marketer’ along with term ‘manufacturer or his agent’ in the Section to do away with legal hurdles in ensuring quality and regulatory compliances of the marketed drugs in the country.
As per the Section 19(3) of D&C Act, 1940, a person, not being the manufacturer of a drug or cosmetic or his agent for the distribution thereof, shall not be liable for ensuring drug quality if he proves that he acquired the drug or cosmetic from a duly licensed manufacturer, and he did not know and could not, with reasonable diligence, have ascertained that drug is of inferior quality and that the drug or cosmetic, while in his possession was properly stored and remained in the same state as when he acquired it.
The marketer not being a manufacturer or an agent gets an exemption under Section 19(3). The definition thus needs to be revised accordingly, said IDMA in a representation to Dr V G Somani, Drugs Controller General of India.
Since the Section is not being amended, it would have conflicting implications for making marketers responsible for quality as well as other regulatory compliances. Any rule contrary to the provisions under the Act or having overriding effect will not withstand judicial scrutiny, it said.
The industry body has also urged the CDSCO to introduce a separate part in the Drugs and Cosmetic Rules (D&C Rules), 1945 to ensure that marketers are responsible for quality and regulatory compliances of the drugs manufactured under Loan License arrangement and P2P contract.
The IDMA has requested above amendments to remove lacuna in gazette notification issued by Union health and family welfare ministry on February 13, 2020 on implementation of Drugs and Cosmetics (Amendment) Rules, 2020 holding marketers along with the manufacturers responsible for ensuring quality and regulatory compliances of the marketed drugs in the country. The Rule will come into force from March 1, 2021.
The newly inserted Rule 84E in D&C Rules comprising responsibility of marketer of the drugs said any marketer who sells or distributes any drug shall be responsible for quality of that drug as well as other regulatory compliances along with the manufacturer under these rules.
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The industry body affirmed that the responsibility for quality and regulatory compliance cannot be placed on the marketer grossly and has to be specified clearly, particularly in view of the fact that the outsourcing of products is done in two different manners – loan license arrangement and P2P arrangement that has different set of responsibilities on the marketing company.
In the loan license arrangement, where the technology/product know-how is provided by marketer, the D&C Rules provide the responsibilities in the form of conditions for grant of a loan license.
In P-to-P arrangement, two P-to-P parties, one having manufacturing skills and capabilities and the other having marketing skills and capabilities work synergistically using their respective skills and resources. Under this arrangement, the marketer accepts the product developed and manufactured by the manufacturer under a drug license.
Under the marketing arrangement, it is practically not possible for a marketer to exercise a control on the manufacturing and testing of the drugs that is governed by the conditions of the license issued to the manufacturing company.
Further, the words “responsible for other regulatory compliance”, are vague, non-specific and wide in meaning. The expected regulatory compliances to be complied by the marketer needs to be provided in clear terms, it added.
In fact, since the marketer is neither a manufacturer, nor a loan licensee, the provisions of Chapter VII governing conditions of manufacturing license would not apply to him. The applicable requirements for storage and distribution of drugs are specified in Part VI. Thus, providing for the responsibility of a marketer under Part VII would be out of place, context and scope of part VII.
The IDMA has suggested the introduction of a separate Part in the D&C Rules, since Part VII applies to license holders for manufacturing – own license/loan license and not to marketers.
The newly inserted Rule 84D in D&C Rules requires that before marketing of the product the marketer should have an agreement with the manufacturer.
Pointing out lacuna in provision of Rule 80D, IDMA stated that the key contents of the agreement are not specified. The shared responsibilities for quality and regulatory compliance between the manufacturer and marketer have to be consistent with the legal requirements and hence have to be specified, it said.
As per the gazette notification, in Rule 2 of D&C Rules, existing clause (ea) shall be re-lettered as clause (eb) containing definition of “marketer” which means a person who as an agent or in any other capacity adopts any drug manufactured by another manufacturer under an agreement for marketing of such drug by labeling or affixing his name on the label of the drug with a view for its sale and distribution.
The IDMA suggested that the term ‘agent or in any other capacity’ in the definition of ‘marketer’ has wider meaning and is not specific. Hence the definition of the term ‘marketer’ has to be modified to remove the words ‘agent’ or ‘person in any other capacity’. Marketer cannot be considered as an agent of the manufacturer since he works on a P-to-P contract basis.
This gazette notification, if implemented without amendments suggested by the industry body, may interrupt supply of medicines that would be against the interest of the patients, particularly in the current pandemic period. The disruption caused by the pandemic is predicted to last for at least two years and any interruption to the supply has to be prevented.
This notification, in its current form, may not provide any additional benefit in terms of ensuring product quality but may act as an impediment in government’s thrust on ‘ease of doing business’. Until the suggested amendments are notified, the implementation of the Rules may be deferred, it opined.
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