Drug Regulation Trade Secret

IP Reveries: Class 5.2 – Interrogating India’s Drug Regulation System


CDSCO Vision – To Protect and Promote Public Health in India.

Prof Antilegend is back to greet you all on this yuletide! After brooding over the basics in the last class, this session (i.e. class 5.2) sieves through the Indian drug regulation system, which has attracted much attention in the last few months. For the previous class, please go here. And if this is your first time coming across the IP Reveries series, you can see what it is about as well as get links to our previous classes in the introductory post here. IP Reveries is co-authored by Swaraj Barooah and myself. For these classes that touch upon Indian drug regulation, we’d like to give a shout out of appreciation for the works of Prashant Reddy T & Dinesh S Thakur which we have learned and are tremendously learning from.

Interrogating India’s Drug Regulation System

Prof. Antilegend: Hello Stars, good morning. Now that you have got an inkling of the drug innovation process from the last class, let’s dig a little bit into the realm of (dodgy?) drug regulation. (smiling)

Slato: Yes. Those readings, that you suggested, gave us a bit more of an introduction to this whole pharmaceutical IP and non-IP world. But Prof. … so much information, trials, waivers and whatnot, we’ll have to break it down.

Prof. Antilegend: Yes, yes, we will need to. Why don’t we start with you telling me what stood out to you from your reading so far? Any particular part that you’d like to start with?

Pocrati: Hmm… I seem to have gathered several small bits of information but not sure how to piece it all together.

Prof Antilegend: Sure, let’s tread with your troves of information. 

Pocrati: Okay, So… It appears that in India, regulatory approval for the import, manufacture, distribution and sale of drugs is still governed by the pre-independence Drugs and Cosmetics Act, 1940 (along with some associated Rules). Is this actually the law that governs current medicine too? In any case, as per this regulatory setup, manufacturers of ‘new drugs’ need to submit data from the different phases of clinical trials, including trials conducted within India, to the regulators for them to check if it’s safe and provides the benefits it claims to. Here you may ask – what are ‘new drugs’? Well, while you can find exact details in the legislative provisions, for purposes of our current discussion, what I’ve understood is that the “new drugs” label is given to those that haven’t received regulatory approval in the form or combination that is sought to be sold; it is also given to novel drug delivery systems, or biologics/vaccines. This ‘new drug’ status lasts for 4 years, except for biologics/vaccines which are considered ‘new drugs’ indefinitely.

Feus: Wait – what does that mean … if it’s 3 years old, it’s still new? What’s the point of this legal fiction?

Prof Antilegend: Good question. What this means is that if you want regulatory approval for a drug that hasn’t been sold in India before, then you will need to submit clinical trial data to the regulators for approval. If your drug is approved, then for the first 4 years of approval, it will continue to be considered a ‘new drug’. This means that if anyone else also seeks to sell their version of that drug, they too will need to submit clinical trial data, even though your version of the drug has been approved. And as we’ve seen in the previous class, this is very expensive and time-consuming, and it automatically reduces the number of potential competitors. And this requirement remains for 4 years after the first approval, unless it is a vaccine or biologic drug. So far, so good, right? You can get a better idea about this from this reasoned report, see paragraphs 142-143.

Akira: Wait … isn’t this a bit duplicative? And perhaps ethically questionable? Repeating expensive trials on human subjects, for drugs that have already received approval?

Prof. Antilegend: It might be and there’s a whole additional ‘data exclusivity’ debate waiting for you if you go there. But – as it turns out, the question to be asking is whether this actually plays out this way in practice! (And let’s not even go into the practice of regulation of manufacturing standards and other details!!)  In reality, it is often the case that new drugs are introduced into the Indian market after they have received foreign regulatory approval. Resultantly, the Indian drug regulator normally exempts manufacturers or importers of a new drug to submit trial reports and grants approval on the basis of bioequivalence and bioavailability tests. 

Feus: bio-equivalence … available tests … What’s that now?

Prof. Antilegend: Essentially, these tests show that the concerned drug produces the same effect at the same rate, as the already approved drug.

Nya: Okay … and (confused face) Prof., you also said that once approved in other markets, they are generally accepted in India. But then those drugs must have been tested primarily on foreigners with different genetic compositions. How ethical and logical is it to assume that tests conducted in the X part of the world on a certain population with different genetic dispositions be suitable to the population of our country (again with a much more diverse population)? This is a matter of health, the mere availability of *a* vaccine/medicine isn’t always the answer. It should be effective as well as safe in the long run. No? What about their testing requirements on the Indian population

Prof. Antilegend: Hm. Technically, Yes, there is a requirement for local trials to ensure that drugs work well on the Indians. In fact, the 59th Parliamentary report on CDSCO highlighted this point noting that:

There is evidence that the effect of some drugs can vary among various ethnic groups. For example, the blood levels reached after intake of lipid lowering agent rosuvastatin are far higher in Asians, compared to Europeans and North American Caucasians, Hispanics and Blacks needing lowering of dosage. Failure to lower dose in Indians can result in severe toxicity, including life-threatening muscle injury leading to fatalities. Hence, testing drugs in the Indian ethnic groups is of paramount importance before approving any drug of foreign origin.” (¶ 7.10)

However, like other things, they can also be waived in the “public interest”. From what I have understood so far from reports and articles is that these waivers have become the norm, meaning that no/very few generic companies conduct these trials before getting approvals in India. Please go searching for data on this though, if you can find any! But note, generic companies are still required to submit bioequivalence and bioavailability studies without any exceptions when a drug is new i.e. in the initial 4 years. (with a pause) Although it’s a different discussion that some Indian Clinical Research Organisations have been accused of fudging even them. Anyway, You can read about them after class here, here, and here.

Pocrati: Wait, with so many tests, I am a bit confused now. Please confirm this – there is one test of bio-equivalence/availability in the initial 4 years period when a drug is ‘new’. This is to enter the market and escape clinical trials. Correct? And there is another test on the Indian population to confirm the therapeutic efficacy which is waivable. Okay? But (curiously) what happens after 4 years when a drug loses the label of “new drug”?

Prof. Antilegend: Yes, you are correct. Regarding your question – the answer is a bit bizarre.  So … before 2017, even the bioequivalence/bioavailability studies were not required after 4 years. But then came a notification which mandated these bioequivalence/availability tests for certain classes of drugs (not treading into the technicalities here!). But this notification only has a prospective application. This means that before 2017, those generic companies which applied for approval (which they generally did) after 4 years may not have submitted these tests. What this means is that we are very likely to have some ‘untested’ drugs in the market today and the 2017 notification can’t help it.

Slato: Oh, sounds damn dangerous!!!

Prof. Antilegend: Exactly, it is! This issue was raised by the Ranjit Roy Choudhary Committee which recommended making these studies mandatory for all generics. (Unfortunately, the report itself doesn’t seem to be available online anywhere – so if any of you can share it, we could share it with the rest of the class!) Sadly, the CDSCO’s drugs consultative committee consisting of state drug controllers and the Drug Controller General of India rejected this recommendation on commercial feasibility. There were even FIRs filed that asked, among other things, for the mandating of these tests for all the generics, but were dismissed as raising issues of only “academic interest”.

Pocrati: That’s sad though I am glad that something happened finally in 2017. But for ‘untested drugs’ that actually go wrong and harm people – there would be some harsh punishment, no? What are those punishments? Even in the Gambia tragedy, I believe that the accused drug manufacturer would be banned now from manufacturing drugs. Please tell us a bit about that.

Prof. Antilegend: Speaking ideally, yes, a minacious manufacturer should face harsh punishments. But now speaking legally, it is not the case in India, sadly! On paper, the highest punishment is 10 years which can be extended to life imprisonment with a fine of 3 lakhs when the drug causes or is likely to cause death. And, for a sub-standard drug, the punishment is between 1-3 years with a fine. However, health researchers and activists say that it does not happen in practice, (sometimes it even turns out that most punishments are just for sitting one day in court!). And what further flaws this fettle is the recent Drugs, Medical Devices and Cosmetics Bill 2022 lowering these punishments.   The Bill, under its Section 56(e), establishes a new category of offences relating to the production or distribution of misbranded medications Technically, this is about “NSQ” drugs i.e. drugs “not of standard quality”! The bill, in its fourth schedule, mentions 43 manufacturing-related defects for which the lowest punishments can be given i.e. imprisonment of up to one year and a fine of at least two lakh rupees. And the defects which are not in the “43 defects list”, the manufacturer is liable for a higher punishment of up to 2 years imprisonment and a fine of Rs 5 lakh.

Coming to the Gambia incident, things are in utter uncertainty – while the Drugs Controller General of India gave a clean chit to Maiden Pharmaceuticals saying that the drugs complied with standards and has no diethylene glycol (DEG), a Geneva lab revealed otherwise claiming the presence of the toxin DEG in impugned syrups. So, no punishment as such except Haryana Government’s order to stop the manufacturing. It is important to note here it is not the first time Maiden Pharmaceuticals to create a cause of consternation! See this image prepared by an Indian newspaper:

Source – Times of India

Slato: Can you give any examples from this “43 defects” club?

Prof. Antilegend: Good question. For the examples … (thinking) … it includes “heavy metals” and “particulate contamination/foreign matter”. Meaning that if a medicine is found to have metals, fungus, or glass particles (which are supposedly dangerous for our consumption), the manufacturer will receive a reduced sentence or maybe no imprisonment at all! Note, the story does not end here – the Bill even has a compounding provision in Section 71 which means that the trial and prison time for the offence can be waived as long as the manufacturer agrees to pay the fine. Moreover, Section 58 even empowers the government to expand the list of exceptions i.e 43 defects lists with the lowest list can be expanded. …

Feus: Prof., I think we should definitely do something about it. But let’s start with taking a break and coming back with more mental mettle! (with a smug)

Prof. Antilegend: Sure. Although I have a few more things to discuss, I want someone to summarise this class, relating it to the previous class.

Sugastine: Yes, I can do it. So …  first, we had a ‘theoretical’ session about drug innovation, its stages, tests etc. Then, in this class, we discussed the practicality of the previous class as to how drug innovation actually works in India. Here, we saw the dire state of our drug regulation, the increasing discretions (and discrepancies) and decreasing punishment and checks. Anything left?

Prof. Antilegend: Fair enough. In the next class, let’s mix theory and practical understanding and deliberate on the future of drug regulation and come back to where we started – “test data”, its importance and implications. But before you leave, here’s a reading recommendation –  Allison Durkin, at el.’s Addressing the Risks That Trade Secret Protections Pose for Health and Rights.

Mindy: Sure, see you in the next class. Thanks

(steps of the students leaving the class)

Image from here

Lokesh Vyas

Lokesh graduated from the Institute of Law Nirma University (2021 batch) and won the first edition of the Shamnad Basheer Essay Competition, 2020. He is currently pursuing an LLM from the American University Washington College of Law and working as a researcher at the Program on Information Justice and Intellectual Property (PIJIP). He is a recipient of the Arcadia Fellowship and Arodhum Scholarship.

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