New Indian GMP Rules to Benefit Multinationals

Small-scale drugmakers represented by the Confederation of Indian Pharmaceutical Industries have urged the government to withdraw new rules obliging manufacturers to adopt good manufacturing practice standards. The legislation is due to be enforced at the end of June.

The government has already twice delayed the implementation of revisions to the so-called Schedule M of India's Drugs and Cosmetics Act. Small drug producers have now enlisted left-wing political parties to pressure the country's fragile governing coalition, amid claims that the reform could close up to 4,000 below-standard manufacturing facilities and lead to the loss of 900,000 jobs. Leftist parties note that many drugs produced by smaller manufacturers are roughly four times cheaper than branded equivalents.

The multinational sector and India's larger firms are likely to be the main beneficiaries of the modernising measures. It is expected that in the longer term the number of Indian manufacturers will consolidate from the current 27,000 to roughly 450, with quality large-scale drugmakers able to meet supply gaps caused by the exit of smaller producers.