Regulator's generic-drug emphasis surprises pharma biz

The Indian pharma sector has been taken by surprise. The Drug Controller General of India (DGCI) has stated that manufacturing licences will only be issued based on generic or chemical names, and not brand names. CNBC-TV18's Archana Shukla reports that industry is divided on whether this order is part of the government's drive to push generics and phase-out brand names.

India's drug regulator has granted licences for Crocin, Calpol, Dolo, Metacin, Febrex-Plus, Pacimol and Panadol among others. However all these are brand names for one generic drug - Paracetamol. But this trend is to continue no more. The DGCI has ordered that manufacturing licences will be granted only for the generic drug and not for specific brand names. It argued that licences based on trade names may be seen as an endorsement of that trade name, which goes against the spirit of legislation.

DG Shah, secretary general, IPA, said, "We have clarified with the drug regulator. The spirit of the current circular is to align ourselves to international standards and separate manufacturing licences from trademarks - a step to deal with the issue of similar-branding tussles. It is not to eliminate brands."

This puts paid to speculation that the order was a sign of the government moving to evict some of the brands from the market. After all, the government has ordered public sector doctors to prescribe only generic names and not brands. Experts say such a shift away from branded generics will not be easy.

Kewal Handa, former MD, Pfizer India , explained, "The entire ecosystem needs to change. We are not yet ready for the change. Firstly, moving 95 percent of the current branded-generics to generic-generics is a huge task and the products have been approved without even safety and efficacy data. Add to this, 50 percent of the market comprises of combination-drugs. How are you going to deal with the combination market?"

Speaking on combination-drugs, the DCGI's reiteratation that it alone, and not state regulators, has the power to licence such drugs has bridged the gap between central and the state drug regulators.

Many see this move as the central government re-establishing control over the drug industry that had dissipated over time. But participants hope it will call for wider consultation before taking any more steps to move towards a predominantly generic-drug ecosystem.