India’s pharmaceutical sector has grown into a major industrial segment over the last 30 years having an annual turnover of nearly Rs. 2 lakh crore with as much as 50 per cent of that being exported to over 150 countries including to most of the developed nations. The country has over 10,000 pharmaceutical units and 7 lakh trading establishments in the retail and wholesale segments. And today India has earned the name of the only major supplier of quality generic drugs at lower prices to the world. This is certainly a great achievement for a sector which was dominated by the multinational drug companies till the end of seventies. Indian private sector and the two public sector drug companies namely Indian Drugs and Pharmaceuticals Ltd and Hindustan Antibiotics Ltd then played a critical role in building up a national sector in the subsequent years. The pharmaceutical industry in the country achieved the current global status without having an ideal policy and regulatory environment on account of the fact that the industry is being controlled by different ministries and agencies. The pricing policy is decided by the ministry of chemicals and fertilizers, manufacturing and quality control is decided by the health ministry, investment policy and IPR matters are handled by the industry ministry and the export related policy is decided by the commerce ministry.

The need to place this industry in a conducive industrial environment has been under discussion amongst the industry leaders and the concerned government officials for some time in the context of the growth prospects of this sector. The government decision to have a separate department for handling pricing related issues of this sector in July 2008 was a first step in this regard. Until then, the secretary in charge of department of chemicals and petrochemicals, has been looking after the affairs of the pharmaceuticals sector. Last week, the Union minister for chemicals & fertilizers, Ananth Kumar himself indicated that there would be a separate ministry for pharmaceuticals and medical devices sector in one year. It is certainly an encouraging announcement from the minister. As of now only 14 medical devices are under any regulatory control although most of them are considered to be life saving products and are highly priced. An exercise is already on for some time to bring all these products under price control and quality scrutiny. While clubbing medical devices under the ministry of pharmaceuticals appears to be rather easy, but to assume the regulatory powers of health, industry and commerce for the ministry of pharmaceuticals may not be that easy. Therefore what is the government intention in this regard is not very clear.