India’s pharmaceutical industry registered a strong export growth during the years 2007 to 2015 and it is expected to continue growing with an annual rate of approximate 22 per cent. According to a survey details pharma SMEs are cost-effective vital resources of skill, knowledge and employment and as per a research report, Indian pharma sector is expected to grow $ 45 million by 2020.

SMEs have strong re-engineering skills, which is helping to produce low-cost yet high-quality value proposition. Contract Research and Manufacturing (CRAMs) and biopharma have emerged as areas of high relevance to the MSME sector.  Increasing opportunities in the generics pharmaceutical market, both domestic and exports are fuelling the growth of this sector. The SME sector is a significant part of the supply chain for the larger players. It is forecast that the MSME units can effectively meet the two major public expectations viz. cost effective and affordable medicines given a framework of excellent manufacturing process, technology, regulatory compliance, distribution system and prices.

In India, drug manufacturing, quality and marketing is regulated in accordance with the Drugs and Cosmetics Act of 1940 and Rules 1945. This act has witnessed several amendments over the last few decades. The Drugs Controller General of India (DCGI), who heads the Central Drugs Standards Control Organization (CDSCO), assumes responsibility for the amendments to the Acts and Rules. Other major related Acts and Rules include the Pharmacy Act of 1948, The Drugs and Magic Remedies Act of 1954 and Drug Prices Control Order (DPCO) 1995 and various other policies instituted by the Department of Chemicals and Petrochemicals. The Indian pharma industry is highly fragmented and therefore creates barriers in the growth path of small pharma companies. There are more than 24,000 registered units, which meet 70 per cent of the country’s needs. Primarily they operate in the local market, and manufacture formulations relating to medicines of mass consumption and thus have a huge market.

Some of the important schedules of the Drugs and Cosmetic Actsi? include: Schedule D: dealing with exemption in drug imports, Schedule M: which, deals with Good Manufacturing Practices involving premises and plants and Schedule Y: which, specifies guidelines for clinical trials, import and manufacture of new drugs. The central regulatory authority undertakes approval of new drugs, clinical trials, standards setting, control over imported drugs and coordination of state bodies’ activities. State authorities assume responsibility for issuing licenses and monitoring manufacture, distribution and sale of drugs and other related products. Pharmaceutical SMEs in India have traditionally been less focused on exports in comparison to large domestic firms. However, now they have become preferred partners for the supply of active pharmaceutical ingredients (APIs) and finished dosages for Indian as well as foreign pharmaceutical firms. Still the following areas are a cause for concern:

Stringent regulations, lack of financing options, little or no global exposure, poor public image and increasing competition from other low cost nations are some of the critical issues being faced by the SMEs in pharma industry.

• Lack of transparency in licencing procedures
• Inadequate regulatory expertise and testing facilities to implement uniform standards
• Need for greater thrust on institutional support to small scale firms to enable speedy implementation of Schedule M up gradation and standardization of drug quality
• Need for greater clarity on patentability of pharmaceutical substances and conditions under which firms can apply for compulsory licences to prevent legal battles between local firms, MNCs and civil rights groups.

Therefore robust and focused business models and plans are need of the hour for pharma SMEs in their growth momentum. High level of entrepreneurial zeal and low operational costs across various pharmaceutical business processes help pharma SMEs grow and prosper.

Government support will be critical in laying the foundation for SMEs to gear-up and face the inescapable challenge through several incentives like development of Pharmaceutical SEZs. The SME segment is also challenged by the need to create visibility and demonstrate credibility to prove their global competitiveness and regulatory environment.

There is a lack of awareness and knowledge about various procedures and regulations among SMEs. Another drawback is that SMEs are seen to have limited ability to attract and retain talent. Moreover, SME players are more vulnerable to market fluctuations as compared to larger players, owing to their restricted ability to adapt to changing market conditions.
 
The future
The concept of national schools of pharmacy should be established to develop and introduce model curriculum in regulatory environment with latest trends and happenings through strong data base. Pharmacists should become knowledgeable to participate in medication management with regulatory approach monitoring. The concept of going through guidelines, practice, appropriate training and implementation should be studied as realistic project program at the school level.  If such tools are adopted the pharmacy profession will make the clinical trial industry in India to grow to over a billion dollars in the next five years and position itself as a destination of choice for CRO services by way of strict implementation of patent laws, single window clearance of clinical trial protocols by regulatory clearances and shall accord industry status to this sector. India will emerge as a major global player in the field of pharmaceuticals exports and as a provider of quality medicines at low costs. It shall also emerge as a major player in the generic drugs market in USA and Europe.

The focus of Indian pharmaceutical regulatory bodies is now shifting towards the risk management and science based GMP regulations with the affordability of quality medicines. The need of the hour is to change the attitude of  the Indian pharmaceutical manufactures from 'What will happen to others, will also happen to me' to 'We resolve to make our industries compliant to regulatory requirements by converting industries research and innovation driven'. This too is true that when our intentions are clear and our efforts are consistent and in the right direction, nothing is impossible.

All changes and challenges are always tough but facing them with determination yields a long lasting success! The future of SMEs in pharma industry is bright. They can play a strong role in R&D segment. Moreover, government is also taking a lot of initiatives and multiple reforms to strengthen their position. Right business model for growth and collaborative approach from domestic and global players will certainly enhance the SME sector in regulatory environment.