Strict norms force medical device producers to abandon projects

Stringent Central licensing norms can discourage investors to invest in the upcoming medical device park at Nalagarh. Delays and the lack of transparency in the current licensing process are forcing the manufacturers to opt for countries such as Vietnam and Malaysia for their manufacturing operations.

These concerns have been highlighted by a parliamentary committee in its recently released report, where the regulatory roadblocks have adversely hit the medical devices sector. Since a medical device park is coming up at Nalagarh, the state’s pharmaceutical industry is worried about its fate in the light of these observations. There are 29 medical device units operating in various industrial clusters such as Baddi-Barotiwala-Nalagarh.

Initially, its project cost was pegged at Rs 349.83 crore, with the Central Government providing Rs 100 crore for the development of common scientific facilities and the state government contributing the remaining funds. The project has now been restructured. Under the new plan, only 25 per cent of the land will be allocated exclusively to medical device industries. The government expects to attract global players to invest in this park. It will take some time for the project to attain maturity as the state government was facing fund paucity.

India imports almost 85 per cent of its domestic requirement of medical devices. Four medical devices park were granted to Uttar Pradesh, Tamil Nadu, Madhya Pradesh and Himachal Pradesh in 2022 to reduce the import of medical devices.

Since the licensing of the medical device sector is Centrally controlled, the parliamentary panel has raised concerns that centralisation of authority may result in creating a situation for arbitrary or discretionary decision-making and recommended establishment of an independent industry advisory board, comprising representatives from the industry.

The panel expressed concern that the current licensing process of the the Central Drugs Standard Control Organisation (CDSCO) was plagued by delays, inconsistent timelines and a lack of transparency, hindering the growth of the medical device industry. The committee expressed serious concern that due to rigid process and inordinate delays by the CDSCO, a large number of manufacturing units have gone to Vietnam and Malaysia. Rather, several medical devices manufacturers were scared to set up a unit in India due to delaying tactics of the CDSCO, claimed the panel headed by Member of Rajya Sabha Ram Gopal Yadav. The parliamentary panel has recommended implementation of a fully digitised, time-bound and trackable licensing system with defined timelines for each stage of the licensing process, including automatic notifications to applicants.

Dr Rajesh Gupta, president of the Himachal Drugs Manufacturing Association, said that the licensing system should be time-bound and digitised, where queries were addressed in a time-bound manner so as to avoid delays and regulatory roadblocks.