Central Idea

The Jan Vishwas Bill, aimed at enhancing ease of doing business, has sparked a heated debate over certain amendments that modify the Drugs and Cosmetics Act, 1940.
While the bill intends to streamline regulatory provisions, critics argue that it may allow manufacturers of substandard medicines to evade imprisonment and instead pay fines for their offenses.

Jan Vishwas Bill

Amendment I: The first amendment under the Jan Vishwas Bill eliminates imprisonment for companies repeatedly using government analysis or test reports to promote their products. Instead, offenders will be subject to a fine not less than five lakh rupees, as opposed to the previous fine of not less than ten thousand rupees.
Amendment II: The second, more contentious amendment allows for the “compounding” of offenses under section 27 (d) of the existing Drugs and Cosmetics Act. Compounding enables companies to pay a fine as an alternative to undergoing criminal proceedings. However, section 27 (d) covers offenses related to drugs not of standard quality (NSQ) or colloquially termed substandard drugs.

NSQ Drugs and Their Risks: Substandard drugs (NSQ) are products that fail to meet Indian Pharmacopoeia requirements, leading to potential harm to consumers. Examples include drugs with low levels of active ingredients, affecting treatment effectiveness and causing antibiotic resistance.
Criticism of Inclusion of Section 27 (d): The inclusion of NSQ drugs under section 27 (d) for compounding has raised concerns among many. Critics argue that it could allow companies to escape liability for manufacturing substandard products by merely paying a fine.

Eligible Offenses: Compounding will be available for manufacturers whose drugs are NSQ, enabling them to avoid criminal proceedings by paying a fine.
Government’s Stance: The government contends that compounding will be reserved for minor aberrations or quality control issues, and companies involved in spurious or adulterated drug manufacturing will not be eligible. It aims to offer an alternate mechanism for minor offenses to reduce litigation delays and foster ease of doing business.

Schedule M Requirements: In 2018, amendments were made to Schedule M of the drug act to improve drug manufacturing practices. However, a significant number of drug manufacturers have yet to adopt these measures.
Compounding for Non-Compliance: Under the Jan Vishwas Bill, companies failing to implement Schedule M requirements within the stipulated time will be prosecuted under section 27 (d).

Industry Support for Compounding: Some manufacturers view compounding as a positive step, preventing minor offenses from leading to lengthy litigation and business disruptions. They argue that non-intentional aberrations should not result in imprisonment, especially for first-time offenders.
Balancing Enforcement and Business Growth: Advocates of compounding emphasize that strict action should be taken against repeat offenders or those engaging in offenses with malicious intent. Balancing enforcement and encouraging quality production will enable the pharmaceutical industry to thrive and produce safe, effective products.

Striking a balance between enabling business growth and enforcing quality standards will be critical in determining the long-term impact of the bill on the pharmaceutical industry.

In news: Jan Vishwas Bill, 2022