In the last few years, the Indian pharmaceutical sector has seen an immense growth both in terms of domestic and international stratum and recognized itself as one of the largest in terms of volume. The emerging market of medical devices is one of the biggest contributions behind the growth in this overall pharmaceutical sector in India.

Further, the approval of 100 % FDI in the pharmaceutical sector under the automatic route for Greenfield investments as well as under the Government approval route for investments in existing companies1 has made India as one of the emerging markets for direct investment in pharmaceutical sector. Various large multinational pharmaceutical companies have shown interest to enter into acquisitions and tie-ups with Indian pharmaceutical companies to make attractive investment for the biggest reason being that India offers them potentiality and ability to manufacture generic drugs and medical devices at a comparatively low cost while at the same time maintaining desired quality.

In spite of such an emerging stride in the Indian market of medical devices, until lately, the medical device sector has remained unregulated and functioning in absence of any standards for the devices used in the healthcare sector. However, the recent initiative of the Indian Government by introducing the Drugs and Cosmetics (Amendment) Bill, 2013 [the Bill 2013] would act like a boon to the industry and would bring along, positive hopes to achieve an assurance of the best and safest medical technologies in the country.

In 2006, the Government realized that the country requires a legislation to bring under its control the safety and performance of medical devices and accordingly introduced the Medical Devices Regulation Bill, 2006 with the intention to consolidate laws related to medical devices and establish the Medical Device Regulatory Authority of India (MDRA). This Bill was aimed at establishing and maintaining a national system of controls for the quality, safety and availability of medical devices in India. However, the above Bill has not been enacted by the Parliament.

At present, provisions related to import, manufacture, distribution and sale of medical devices are covered under the Drugs and Cosmetics Act, 1940 [“Act”] and the Drugs and Cosmetics Rules, 1945 [“Rules”]. However, the said Act and the Rules cover only notified Medical Devices2. Notified medical devices are those medical devices which have been notified as drugs by the Government of India. Notified Medical Devices are currently covered under the definition of Drugs under the Act under Section 3 (b) (iv) which reads as follow:

“b) “drug” includes—

…(iv) such devices intended for internal or external use in the diagnosis, treatment, mitigation or prevention of disease or disorder in human beings or animals, as may be specified from time to time by the Central Government by notification in the Official Gazette, after consultation with the Board ”

The Drugs and Cosmetics (Amendment) Bill , 2013

The most recent measure taken up by the Government on 29 August, 2013 is the introduction of the Drugs and Cosmetics (Amendment) Bill, 2013. The Bill 2013 interalia contains a separate Chapter for regulatory provisions for import, manufacture, sale, distribution and export of medical devices and for regulating conduct of clinical trials in India. This Bill 2013 also provides provisions for setting up of a Central Drugs Authority (CDA) as an overarching body for regulation of drugs and cosmetics. The Authority shall have power to issue a license or a certificate, as the case may be, for the manufacture for sale or for export of drugs specified in the Third Schedule to the Act.

Regulations on the Medical Devices

In terms of medical device, the Bill 2013 has thrown light on the definition of the term “medical device” on the same approach as that of MDRB. In the Bill 2013, medical device includes additionally the instruments for diagnosis, monitoring, treatment, alleviation of, or assistance for handicaps also. Once the Bill is passed, the definition of medical device will no longer be read in the light of the definition of “drugs” as specified under Section 3(b)(iv) of the Drugs and Cosmetics Act, 1940 which creates ambiguity and restricts the ambit of medical device only to notified medical devices.

Provisions related to import, manufactu re, sale, distribution and export of medical devices

The import, manufacture, sale, distribution, export and labelling of notified medical device is regulated under the Drugs and Cosmetics Act, 1940. However, it is felt by the industry and regulatory authorities that provisions related to drugs cannot be applicable entirely for medical devices. In this context, the present Bill 2013 is an attempt to frame provisions which are specific for medical devices. For instance, the Bill 2013 specifies the conditions under which medical devices shall be deemed to be misbranded, adulterated, spurious or not of standard quality. In order to define when a medical device shall be deemed to be misbranded under Section 7 C of the Bill, it has made new insertion of the term “functional value” and states as “…………if it is made to appear of better or greater therapeutic or functional value than it really is…” Similarly, a new subclause (e) has been inserted in Section 7D of the Bill 2013 which defines when a medical device shall be deemed to be adulterated drugs and the same reads as “if its containers is composed, in whole or in part, of any deleterious substance which may render it dangerous to use or injurious to health.”

The Bill 2013 restricts any person to import or manufacture for sale or for export by himself or by any person on his behalf those medical devices which are not of standard quality or misbranded, adulterated, spurious under Section 7F and it has also inserted a new sub-clause that includes restriction for import or manufacture for sale or for export any software or part or component or instrument or the list of the software or part or ingredient or instrument contained in it, unless displayed in the prescribed manner on the label or container.

The Bill 2013 has also laid down the penalties for the offences related to import, manufacture for sale, stocking, exhibiting, offering for sale of medical devices or distribution or export of any adulterated, spurious or not of standard quality medical devices and penalties related to grievous injury or death caused due to use of such medical devices. Further, Section 7 M specifies provisions for confiscation of medical device, implements, machinery, receptacles, packages, coverings, animals, vehicles, vessels or other conveyances of persons convicted for offences under Chapter II A of the Bill 2013.

Advisory body pertaining to the matters related to the medical devices

The Bill 2013 includes Section 5A which specifies the establishment of a Medical Devices Technical Advisory Board which will act as an advisory body to the Central Government, the Central Drugs Authority and State Governments on technical matters pertaining to medical devices, arising out of the administration of the Bill 2013 and to carry out other functions assigned to it by or under the purview of the Bill 2013.

Similarly, another advisory committee called “the Drugs, cosmetics and Medical Devices Consultative Committee” may also be constituted by the Central Government which would require to provide advice to the Central Government, the Central Drugs Authority and State Governments on matters pertaining to secure uniformity throughout India in the administration of the provisions of the Bill 2013.

Formation of the Central Drugs Authority (CDA)

Further, the Bill 2013 has inserted Chapter I A that specifies the structurization of new regulatory authority- the Central Drugs Authority. The CDA will be empowered to act like a regulatory check on the functioning of the Central Licensing Authority and the State Licensing Authorities. In fact, in order to attempt for diligent functioning of these authorities, CDA can assess periodically the functioning of the authorities and further specify regulations, guidelines, norms, structures and requirement for effective functioning. In the recent years, there have been several reports of irregularities in issuance of permissions, licenses or certificates and permits by the State authorities. Keeping in view such circumstances, the Bill 2013 empowers the CDA to review, suspend or cancel any permission, license or certificate issued by the Central Licensing Authority or the State Licensing Authorities and it extends to issue, renew, suspend or cancel such license, certificate, approvals and permissions for conducting clinical trial as well.

Regulations with respect to conduct of clinical trial in the Bill 2013

The insertion of Chapter IB on the provisions related to clinical trial will strengthen statutory protections related to the serious risk involved in the conduct of clinical trial. A new insertion of provision specifies that the CLA may, in public interest, abbreviate, defer or omit the pre-clinical and clinical data requirements for approval of clinical trial of drugs indicated in life threatening or serious diseases or diseases of special relevance to the country. Further, Bill 2013 has inserted provisions related to stringent punishment for the companies conducting clinical trial without permission or in contravention of any provisions specified in the Bill 2013 and provisions related to compensation for adverse effects of clinical trial suffered by the participants of clinical trial. The Bill 2013 also lays down that the companies which are held responsible to pay compensation to the victims of clinical trial who suffered injury or death as a result of the adverse effect of the clinical trial companies, fails to do so, shall be punished with imprisonment which may extend to two years and with fine which shall not be less than twice the amount of the compensation.

Conclusion

The emerging stride of Indian pharmaceuticals is not only helping in the growth of the economy of the country but also bringing the concept of globalization more nearer. The Bill 2013 would undoubtedly provide a set of regulations which would define the standards and quality of medical devices to be available in the market.

The Bill 2013, once passed, will govern import, export, manufacture, distribution and sale of the medical devices and conduct of the clinical trials in India. Further, the Bill 2013 would completely overhaul all existing standards and lead to systematize the activities in the market related to medical devices and consequently, it will attract more international medical device companies to show willingness to manufacture products locally or import medical devices because of their assured quality and standard. Further, provisions relating to conduct of clinical trials which have been addressed extensively are a significant step towards implementation of Good Clinical Practice- a practice appreciated worldwide. Precisely, this Bill 2013 would not only play the role of a strict vigilance on conducts of the companies dealing with medical devices and clinical trials but also have a deterrent effect on those companies for not adhering to the standards formulated for the medical devices and procedures of conducting safe clinical trials.