The Union Health Ministry decided to ask all drug procuring agencies under its control to stop insisting on WHO GMP certification as a pre-condition for drug companies to participate in government tenders. The Health ministry's move is in the wake of increasing instances of agencies demanding the certification as a prerequisite to take part in the tenders. The decision should prove helpful to hundreds of SSI units who possess valid manufacturing license from the state drugs control departments, but had been deprived of the government orders due to the absence of a WHO GMP certified manufacturing facility.

WHO GMP certification is needed for companies who are looking for export orders and not for companies who want to manufacture and sell their products in the domestic market.

The decision in favour of the SSI sector has come in the backdrop of a series of High Court verdicts from several states in this regard. Atleast three HCs had quashed the decision of the government agencies for WHO GMP certification as an eligibility condition to take part in official tenders. The recent verdicts of the High Courts of Uttaranchal, Andhra Pradesh and Uttar Pradesh had all supported the view of the SSI sector, and had agreed that WHO GMP should not be a pre-condition for participating in domestic tenders.

In the Uttaranchal case, the HC had termed the pre-condition as unfair, unreasonable and arbitrary. It had said that the government of Uttaranchal had issued all necessary certificates that permit the manufacturer to manufacture and sell their medicine in open market from where the general public may purchase and use the same. In this eventuality, the government cannot deprive the petitioners to participate in the tender process of supply of medicines to the government hospitals and dispensaries on rate contract, which will be ultimately distributed to the general public, it had noted.

The central government, through the recent directive, has made sure that none of its procurement agencies are insisting on WHO GMP for procurement of drugs for domestic use. It is known that there are hundreds of central government institutions that float tenders for the procurement of drugs. Even a large hospital is considered as a procurement agency, it is learnt.

According to sources, there are two major consequences of the insistance of WHO GMP certification. While the problems faced by the SSI sector is the most important issue, there are also complaints of some small-scale units, managing to furnish WHO GMP certificates even without possessing the required infrastructure, and thereby creating headaches for larger companies. The big and medium pharma sector unit which possess the certificates feel that the companies who really don't go by the quality norms can quote the lowest prices and thereby topple their chances for winning the tenders. They allege that the SSIs manage to get the certification from states where the drug enforcement agency is weak.

The SSI sector counters this argument by alleging that the bigger companies are going out of the way to influence the procurement agencies for incorporating WHO GMP clause among the tender conditions and thereby killing their chances.

The government decision will now bring an end to the complaint from both the sectors that caters to domestic supply of drugs, sources feel.