NEW DELHI/MUMBAI, (Reuters) – Officials of India’s drug regulator have been colluding with pharmaceutical firms to speed up approval procedures, allowing some drugs that are not permitted in other countries to go on sale, according to an 18-month investigation by lawmakers.
The parliamentary panel’s 78-page report names a number of major international drug companies and Indian firms.
The report may fuel concerns over lax supervision of the global industry in emerging markets, where Western drug manufacturers are increasingly focusing their sales effort.
The report talks generally of collusion between officials in the Central Drugs Standard Control Organisation (CDSCO), independent medical experts and pharmaceutical companies but does not directly accuse the firms of wrongdoing or name any of the CDSCO officials.
Instead, the panel catalogued a series of procedural failures that it said raised questions about how some of the drugs, including those made by pharmaceutical giants, were allowed to be sold in India.
Thirteen drugs scrutinised by the panel are not allowed to be sold in the United States, Canada, Britain, European Union and Australia, it said.
The Indian pharmaceutical market is the fourth largest in the world in terms of volume, according to the Organisation of Pharmaceutical Producers of India (OPPI). It generates $12 billion in sales every year.
International drug companies whose profits are being squeezed by patent expiries in the developed world are investing heavily in emerging markets, which are expected to account for 29 percent of global pharmaceuticals sales by 2015, up from just 12 percent in 2005, according to IMS Health.
The dash into new markets has brought with it greater scrutiny from U.S. regulators, which are investigating a number of drug companies under the Foreign Corrupt Practices Act.
The Indian government has come under intense pressure over the past two years over its failure to stem graft that has undermined investor confidence.
“COLLUSIVE NEXUS”
The report by the health committee of the upper house of India’s parliament painted a chaotic picture of the CDSCO, which oversees the licensing, marketing and trials of drugs in India.
“There is sufficient evidence on record to conclude that there is collusive nexus between drug manufacturers, some functionaries of CDSCO and some medical experts,” it said.
The report underlines the difficult relations between international drug companies and India, a country with a long history of making cheap off-patent medicines. Western firms were alarmed by New Delhi’s decision in March to effectively end Bayer’s monopoly on cancer drug Nexavar by issuing the country’s first-ever compulsory licence.
The panel recommended the government re-examine certain drugs that had been approved, investigate the “gross violation” of Indian laws it had uncovered, and take action against officials alleged to have colluded with the drug companies.
“What we have found is very alarming,” Brajesh Pathak, chairman of the Standing Committee on Health and Family Welfare told Reuters. “The Health Ministry should investigate the matter and take urgent action on the report.”
The Health Ministry said it was studying the report and would take “appropriate action” if required.
The newly appointed Drug Controller General of India, G.N. Singh, who is head of the CDSCO, said he had not seen the report but that his team was dedicated to making sure “there are no violations”.
The OPPI, the main lobby group for foreign drug-makers, said some of the committee’s “observations” raised serious concerns.
“We sincerely hope that necessary remedial measures will be taken by the concerned authorities to set the system right, sooner,” said Tapan J. Ray, OPPI’s director general.
“So far as clinical trials are concerned, OPPI members remain committed to sponsoring clinical trials that fully comply with all legal and regulatory requirements in India,” he said.
A spokesman for Danish drugmaker Lundbeck, whose anti-anxiety drug Deanxit the report described as “unlawfully approved”, said the medicine had been approved after undergoing mandatory clinical trials in India.
OPINIONS WRITTEN BY “INVISIBLE HANDS”
The parliamentary report found numerous shortcomings in the CDSCO.
The regulatory body suffered chronic staff shortages and was overwhelmed by its responsibilities in a country where more than 10,500 drug manufacturers were operating and the pharmaceutical industry was growing at a rate of about 10 percent a year.
The report also said the body had for decades neglected the “poor and hapless patient” in favour of the drugs industry.
“The regulatory procedures are not at all stringent in India and there is a general apathy towards human life.
