The pharmacy of the Global South is facing a reputation crisis after cough syrups made by Indian pharmaceutical companies were found to contain harmful levels of diethylene glycol and/or ethylene glycol.
Why is the pharmacy of the Global South facing a reputation crisis?
- Quality Control Failures and Contaminated Products:
- Gambia (2022): Cough syrups made in India containing diethylene glycol and ethylene glycol killed 66 children.
- Uzbekistan (2022): Similar contamination led to the deaths of 65 children.
- U.S. (2023): India-made eye drops contaminated with drug-resistant bacteria caused 3 deaths and 8 cases of blindness.
- Illegal Manufacturing and Unapproved Drugs: Unauthorized drug production and export are damaging India’s credibility. Example: Aveo Pharmaceuticals (Maharashtra) illegally exported unapproved opioid combinations to West Africa, exposed by a BBC investigation in 2023.
- Regulatory Lapses and Weak Oversight: Inconsistent enforcement by regulatory authorities enables violations. Example: State drug authorities in India have issued licenses for unapproved Fixed Dose Combinations (FDCs) without clearance from the Central Drugs Standard Control Organization (CDSCO).
- Global Scrutiny and Trade Barriers: Increased surveillance by international health bodies and trade restrictions. Example: The WHO’s alert on toxic cough syrups led to enhanced inspections of Indian pharmaceutical exports, impacting trade with African and Southeast Asian nations.
How does this impact India’s hegemony?
- Erosion of Soft Power and Global Reputation: India’s image as the “Pharmacy of the Global South” is under threat due to quality concerns and regulatory lapses. Example: The WHO alerts on contaminated cough syrups in Gambia and Uzbekistan have damaged India’s credibility as a reliable supplier of affordable medicines.
- Reduced Diplomatic Influence in Developing Countries: Many nations in Africa and Southeast Asia, which depend on Indian pharmaceuticals, may seek alternative suppliers, weakening India’s influence in these regions. Example: Countries like Nigeria and Kenya exploring Chinese and Brazilian pharmaceutical alternatives.
- Economic and Trade Consequences: Heightened global scrutiny could lead to export restrictions and trade losses, affecting India’s dominance in the generic drug market. Example: In 2023, the U.S. imposed tighter checks on Indian pharmaceutical imports following incidents of contaminated eye drops, impacting Indian drug exports.
| What is the extent of India’s pharmaceutical exports? Total Export Value: India’s pharmaceutical exports were valued at USD 27.85 billion, contributing substantially to the nation’s economy.Global Market Share: India stands as the world’s third-largest producer of pharmaceuticals by volume, supplying approximately 20% of global generic drugs, with North America being a major recipient.Key Export Destinations: The United States remains the largest importer of Indian pharmaceutical products, accounting for 17.90% of India’s total merchandise exports in this sector.India supplies about 26% of Africa’s generic pharmaceutical market, highlighting its role as a key provider of affordable medicines on the continent. |
What steps has the Indian government taken in this situation?
- Strengthening Regulatory Oversight: The Central Drugs Standard Control Organization (CDSCO) has intensified inspections of pharmaceutical manufacturing units to ensure compliance with Good Manufacturing Practices (GMP). Example: Following the Gambia and Uzbekistan incidents, the government ordered inspections of 76 cough syrup manufacturers across 20 states, leading to the suspension of several licenses.
- Policy Reforms and Legal Action: The government introduced a mandatory quality certification for drug exports to certain countries to prevent the export of substandard medicines. Example: After the Aveo Pharmaceuticals case, the Maharashtra government revoked the company’s manufacturing license and seized 13 million illegal medicines.
- International Collaboration and Transparency: The Indian government has increased cooperation with the World Health Organization (WHO) to address quality concerns and strengthen pharmacovigilance. Example: India joined hands with African health regulators to enhance quality assurance for pharmaceuticals exported to African countries.
Way forward
- Strengthen Regulatory Oversight: Implement stricter quality controls, regular audits, and a centralized tracking system to ensure compliance with global standards.
- Enhance Global Collaboration: Partner with international health bodies and key importing nations to improve quality assurance and rebuild trust in Indian pharmaceuticals.
Challenges in India’s Pharmaceutical Sector
| Challenge Type | Issue | What It Means in Simple Terms | Example |
| Regulatory Challenges | Quality & Safety | Strict FDA inspections and safety concerns force companies to spend more on compliance, slowing growth. | Contaminated Indian cough syrups in Gambia led to safety alerts. |
| GMP Compliance | Following Good Manufacturing Practices (GMP) raises production costs by 25% for exports. | Higher costs for Indian drugs sold in US & Europe. | |
| Intellectual Property Rights (IPR) | India’s slow patent process and generic drug production create conflicts with international companies. | Disputes over generic versions of patented drugs. | |
| Lack of Mandatory Recall Law | No strict laws for recalling bad drugs, affecting safety. | Ranitidine was not recalled quickly despite cancer risks. | |
| Systemic Challenges | Dependence on Foreign Raw Materials | 70% of Active Pharmaceutical Ingredients (APIs) come from China, creating supply risks. | COVID-19 lockdown in China disrupted India’s drug production. |
| Unstable Pricing & Policy | Frequent drug price controls discourage companies from investing in new medicines. | Price caps on essential medicines affect production. | |
| Structural Challenges | Counterfeit Drugs | Fake medicines threaten public health due to weak regulation. | Low-quality painkillers & antibiotics in circulation. |
| Limited Infrastructure | Poor storage and supply chains delay critical drug availability. | Remdesivir shortages during the pandemic. | |
| Global Competition | Indian companies compete with China, Israel, and Japan in drug manufacturing. | China dominates low-cost API production. | |
| Slow Digitalization | Indian pharma lags in automation and digital tracking of drug safety and quality. | Lack of AI-driven drug monitoring. | |
| Ethical Challenges | Unethical Marketing | Some pharma companies offer gifts to doctors to promote medicines, leading to overprescription. | Freebies for doctors influencing prescriptions. |
| Unregulated Innovation | Many antibiotics sold in India lack proper testing, worsening antibiotic resistance. | Ineffective Fixed Dose Combinations (FDCs) of antibiotics. | |
| Lack of Transparency | Patients are not informed properly about drug risks and side effects. | Inadequate warnings for strong painkillers & steroids. |
