Almost 40 per cent of the small scale drug units had to close down their operations during the past 3 years as they were not able to bear the cost of implementing Schedule M norms. The Union health ministry enforced the Schedule M norms from 2005 as a step towards improving the operations of the small scale sector in the new competitive environment.

This fact came into the notice of the National Productivity Council (NPC) during its sample survey in May and June covering the SSI clusters located in Karnal, Chandigarh, Mumbai, Indore, Ahmedabad, Baroda, Himatnagar, Vatva and Surendranagar to assess the ground realities in connection with the proposed Pharmaceutical Technology Upgradation Fund (PTUF) Scheme, it is learnt. The Chemicals Ministry, which has conceived the scheme, had asked the Council to study the SSI sector before finalising the project.

The units have in general cited lack of funds and excise duty structure as the main reasons for failing to complete the implementation of Schedule M norms, as the Council found that R&D was practically absent in these units.

The study also has reportedly assessed that about 50 per cent of closed units and around 4000 running units would get the benefit of the scheme. The majority of units were at different stages of compliance of Schedule M and substantial improvement has been noted in different aspects like layout design, housekeeping, protective instruments, new machineries for tablet/capsule making, coating, printing and packaging and bottle cleaning. About 10 per cent of units were found to have obtained ISO 9001 quality certification.

However, areas of concern were training of employees, documentation including computerisation, lab equipments, good laboratory practices, quality management systems, safety, lack of professional guidance to implement the norms and the absence of technical forums for the SSI industry.

It was found that 95 per cent of SSI units were principally focused towards manufacturing of tablets and capsules. But R&D was practically absent in all the units.

Before implementation of Schedule M, the SSI units were running mainly to comply with the pharmacopoeia requirements without much knowledge and concern about technology, manufacturing environment, quality systems, documentation and health and safety, the Council observed.