While  the union commerce ministry is standing firm on its decision to  make barcoding mandatory for all pharma exports from July 1 to check the export of spurious  drugs, a section of the  pharma industry is equally adamant  on  thwarting  the move.

Pointing out that  a section of the exporters  may lose the entire export business in one stroke of the ministry, the industry  is bracing up itself to move court against the introduction of barcoding.

Barcoding is  an international concept which facilitates product identification using international numbering system, promotes brand image and enable timely and accurate capture of product information. The use of barcoding can have wide-ranging benefits such as lowering of inventory costs, reduction in supply chain costs and hence overall reduced costs for products, increasing efficiency of industry and adherence to stringent quality assurance norms through product traceability.

The other key benefits of ID and barcoding on pharma products would be to prevent risk from litigation. It will give a competitive edge to the pharma manufacturers and distributors. Going by the  number of not-of standard drugs being seized in the country, a ID and bar code will help the  pharmaceutical companies to better manage product recalls.

For the genuine manufacturers, barcoding ensures protection from the counterfeiters as the products can be traced  back to the company through the system. It will reflect on the quality standards of the company and the efficient norms practised.

Officials are of the view  that the step would put at rest all baseless speculation of India being a source of spurious drugs and build a formidable reputation of the country’s drug industry. The government also expects the step to clear other illegal channels of trade. For instance, spurious drugs found in Nigeria in 2009 that had  ‘made in India’ label were finally traced back to China.

According to  some experts, barcoding  is a proven, efficient and most  cost-effective mode to capture data for a variety of applications. In fact, ID and barcoding should be a mandatory policy of individual pharma companies. When multinational companies like Pfizer and GSK are using ID and bar codes to trace the products, it is high time Indian pharma too take a clue and follow  the same, they point out.

 Despite all the benefits of this technology, adoption of barcoding continues to be a bone of contention. While a few top pharma firms have either been neutral or have favoured the proposal, many midcap players are opposing it vociferously and most small players have termed it as a death knell for their business. However the  domestic pharma  biggies which compete in the  global markets in the business of branded generics aim to keep themselves abreast with technological advances.

Although the Union commerce ministry’s decision to implement the barcode system  from July 1 is appreciable in terms of brand India promotion, industry sources feel that the time given for the exporting units to implement it is too short and needs to be reviewed.

Many of the drug exporters in the country have resisted the move stating that it is practically impossible to implement the standards of barcoding notified by the government within a span of few months. They say the transition time that the government has granted them to shift from manual packing to automation will incur  huge investments. This, in turn, would increase input costs significantly and take away the cost-advantage that Indian companies are known to offer in a highly competitive international market.

According to one of the experts, the implementation of bar code as per GS 1 global standards is cumbersome, time-consuming and costly. And what has raised concern for the SMEs is the provision seeking the introduction of the bar code at three levels, instead of just the primary packages. For small companies, who will not have huge quantum of export, the barcoding will be a huge burden as the specified machines for the same can cost up to Rs.40 lakhs.

Since  close to 70 per cent  of packaging happens manually here, to be compliant to the new rule, the entire industry has to adopt automation for packaging and that would entail huge  expenses. This is bound to affect the Indian industry adversely in terms of the cost advantage that it is known to offer, in the international market. Within the country, the drug prices would also shoot up.

Further he points out that  it would be  better  to make it mandatory for the chemist to write the batch number and other details on the receipt, so that the drug can be traced back. India has more than six lakh chemists and if they do not have bar code readers what is use of bar code? he asks .

According to a report , the Pharmexcil is  in talks with the government to implement the plan in a phased manner and also start it with mandating only on tertiary packing (cartons) instead of all levels of packaging.

Pharmexcil has already made a representation to the ministry of commerce highlighting various issues that have emerged following the government order. Pharmexcil is now waiting for the ministry’s reply, according to  Bhavin Mehta, COA Member, Pharmexcil.

The IDMA  is understood to have sought the deadline of implementation be postponed from July 2011 to July 2013 and has demanded a clear exclusion of primary packing material such as bottle, blister and vial from barcoding.

An IDMA representation has apprised the ministry that since the text matter on the label of each strip or vial has to be approved by the individual importing country, changes would first have to be approved by the regulator of importing countries. Therefore, the drug makers are insisting on limiting the implementation of technology to tertiary packaging, that is the carton.