Indian Parliamentary Research Service Legislative Summaries

The 2005 Bill increases penalties significantly for certain offences in the Drugs and Cosmetics Act, 1940 (Principal Act). Some of them are listed in Table 1.

The 2005 Bill also: (a) designates Session Courts as special courts to try offences related to adulterated and spurious drugs; (b) in addition to drug inspectors, allows police officers of a minimum rank of sub-inspectors and authorised officers of the central and state governments to prosecute offenders; and (c) makes offences related

Table 1: Some offences and penalties in 2005 Bill

Nature of Offence

Penalty

Manufacturing or selling adulterated/spurious drugs leading to grievous harm or death.

Life imprisonment and min fine of Rs 10 lakh or 3 times value of the drugs confiscated. Fine to be paid as compensation to victim or relative of victim.

(1940 Act: 5 years to life imprisonment and min fine of Rs 10,000).

Manufacturing or selling a drug which is adulterated or without a license.

3-5 years imprisonment and a min fine of Rs 1 lakh.

(1940 Act: 1-3 years imprisonment and min fine of Rs 5,000. Court has discretion to impose lesser penalty).

Manufacturing or selling spurious drug.

7 years to life imprisonment and min fine of Rs 3 lakh or three times the value of the drug confiscated.

(1940 Act: 3-5 years imprisonment and min fine of Rs 5,000. Court has discretion to impose lesser penalty).

Drugs and Cosmetics Act, 1940

Drugs and Cosmetics (Amendment) Bill, 2007

Structure for Regulation of Drugs and Cosmetics

The central government shall establish a Drugs Technical Advisory Board and an Ayurvedic, Siddha and Unani Drugs Technical Advisory Board.

The central government shall establish a Central Drugs Authority (CDA) which replaces both Drug Technical Advisory Boards. It shall consist of a Chairperson and 3 to 5 members. The CDA shall appoint a Drugs Controller (India) who shall be the Chief Executive Officer and the legal representative of the CDA.

The CDA shall recommend to the central government standards for drugs and cosmetics, the Central Drugs Laboratories for testing drugs and cosmetics, measures to regulate import, export, manufacture for sale, and distribution of drugs and cosmetics, measures to regulate clinical trials etc; and may appoint Government Analysts and Inspectors.

The central government may establish a Drugs Consultative Committee to advise the central and state government and the Drugs Technical Advisory Boards. The members shall be nominated by central and state governments.

The central government may establish a Drugs Consultative Committee and an Ayurvedic, Siddha and Unani Drugs Consultative Committee. These committees may advise the CDA as well as the central and state governments on matters related to uniformity in the administration of the law. Both Committees are to be composed of representatives of the central and state governments, industry, consumer groups, etc.

Licensing

Central government to prescribe in the Rules the authority that would issue licenses. License for manufacture of drugs in Schedules C and C1 and imports, shall be issued by the Central License Approving Authority (Drug Controller, India). License for manufacture and sale of other drugs and manufacture of cosmetics shall be issued by Licensing Authorities appointed by state governments.

The CDA will be the sole licensing authority for manufacturing for sale, export, import distribution or stocking of certain drugs and cosmetics.

Definition

The definition of “drug” includes, among other items, devices intended for internal or external use in the diagnosis or treatment of disease in human beings or animals, as may be specified by the central government.

The definition of “drug” expanded to include medical device, instrument, and software needed for their application, as may be specified by the central govt after consultation with the CDA. The device may be used for the purpose of diagnosis of any disease; diagnosis of or compensation for any injury or handicap or control of conception.

Creation of Fund

No fund

The central government shall set up a Central Drugs Authority of India Fund. It shall include all grants and fees received by the CDA. It shall be used for salaries of the members and employees of the CDA and for the implementation of the Bill.

Regulation of Clinical Trials

Clinical trial is not defined in the Act but is detailed in the Rules. Clinical trial means “a systematic study of new drugs in human subjects… with the objective of determining safety and/or efficacy of the new drug.”

“Clinical trial” means systematic study of any drug or cosmetic [not just ‘new’ drugs].

Clinical trials shall be conducted only with the permission of the Drug Controller, (India) and an ethics committee of the testing institution. The ethics committee should have a Chairperson who is outside the institution and a mix of medical and non-medical persons.

No penalty prescribed for violating this provision.

Clinical trial can be conducted only with the permission of the CDA.

If a person contravenes this provision, he shall be punished with imprisonment for a maximum term of five years and a fine of up to Rs 10 lakh. On subsequent conviction for the same offence, the person shall be punished with imprisonment up to 10 years and a fine which may extend to Rs 20 lakh. A person can be prosecuted only on a complaint made in writing by an officer authorised by the CDA.

2005 Bill

Standing Committee Recommendations

Penalty

Penalty enhanced for manufacturing or selling adulterated or spurious drugs, which is likely to cause death or grievous harm.

In addition to death and grievous harm, prolonged illness should be a criterion for imposition of this penalty.

Penalty for subsequent offences

Deletes provision of penalty for subsequent offences in case of manufacturing or selling any drug in contravention of the law (other than adulterated or spurious drugs) and in case of use of Government Analyst reports for advertising.

Provisions should not be deleted.

Cognizance of offences

In addition to drug inspectors, police officers and authorised officers of the central and state governments may prosecute offenders.

Prior permission of the Drug Licensing Authority of the concerned area should be made a pre-condition before involving police inspectors and government officers.

Compounding of offences

Allows authorised officers of the central and state governments to compound certain offences.

There should be certain pre-requisites for compounding such as aggrieved party’s concurrence; the amount compounded should be adequate to compensate the aggrieved person; the cost of litigation should be included in the sum compounded.

Special Courts

Provides for special courts to try offences and designates Courts of Session as Special Courts.

New courts should be set up for the purpose of trying offences under the Drugs and Cosmetics Act, 1940.

Recommendations

Drug Regulation at central level

• Transform the Central Drugs Standard Control Organisation into a well-equipped, independent and professionally managed body, with the status of CDA, under the Ministry of Health and Family Welfare

• Establish 10 main divisions within the CDA manned by adequately trained manpower

• Provide for funds for new structure and sourcing of external expertise and provide for technical manpower

• Allow CDA to grant manufacturing licenses to address issue of non-uniformity of enforcement

2007 Bill establishes CDA with provision for offices in other places; creates Fund for financing its activities; and centralises licensing

Drug Regulation at state level

• Strengthen state drug control organisations with additional manpower, infrastructure, technical capabilities and adequate budget

• Set up intelligence cum legal cell under the supervision of trained senior nodal officers, and enforce condition of licence for sale of drugs

2007 Bill has no provision

Medical Devices and Diagnostics

• Separately define medical devices and frame guidelines for their regulation

• Set up Medical Devices Division in the CDA

• CDA should set up regulatory mechanism for quality assurance and post-marketing surveillance of imported and locally made medical devices

2007 Bill expands definition of “drugs” to include certain devices

Clinical Research

• Share responsibility for safety of Indian subjects in clinical research by all stakeholders (investigators, sponsors, ethics committee and regulators)

• Institutionalise Good Clinical Practices to achieve credibility for data generated in India

• Require regulatory agency to develop adequate capacity to undertake routine inspections of clinical trial sites

• Consider expedited approvals for Phase II and III clinical trials on the basis of approvals accorded by International Conference on Harmonisation signatory countries

• A single window clearance mechanism for approval of applications related to drug research

• Rationalise policies related to animal experiments

2007 Bill provides for regulation of clinical trials for any drug or cosmetic

Spurious and Sub-standard Drugs

• Create effective interaction among stakeholders (regulators, consumers, industry, medical profession)

• Enhance penalties making offences cognisable and non-bailable

• Identify designated courts for speedy trials of spurious drug cases

• Discourage proliferation of drug distribution outlets

• Industry should create counterfeit drug strategies and surveillance systems

• Review system to tackle issue of non-uniformity in action taken on sub-standard drugs in different states

• Strengthen states with technical know-how and manpower to monitor quality of drugs manufactured and sold

• Improve testing laboratories by making Good Laboratory Practices norms a statutory requirement, accreditation with National Accreditation Board for Testing and Calibration Laboratories mandatory, etc

2005 Bill provides for enhanced penalties for certain offences, makes offences cognisable and non-bailable, and designates Sessions Courts for trying cases