The Union health ministry will soon amend the Drugs & Cosmetics Rules, 1945 pertaining to the condition under the manufacturing licences regarding the validity of the licence in the event of a change in constitution of the firm operating under the licence.

The health ministry's action in this regard comes in the wake of proposals to this from the Union commerce ministry. The commerce ministry had earlier forwarded several representations from the pharma industry regarding the difficulties faced by the companies in the process of merger in their export commitments because of the condition of the licence for manufacture of drugs which restricts the validity of the licence in the event of change in the constitution of the firm operating under the licence.

According to source, similar representations were also received by the health ministry from bona-fide exporters whose products are registered in the importing countries.

The text of the condition is, "The licensee shall inform the licensing authority in writing in the event of any change in the constitution of the firm operating under the licence. Where any change in the constitution of the firm takes place, the current licence shall be deemed to be valid for a maximum period of three months from the date on which the change takes place unless in the meantime, a fresh licence has been taken from the licensing authority in the names of the firm with the changed constitution."

In order to ensure that bona-fide export is not hampered it was proposed by the ministry to amend the above condition by incorporating the following clause in the above condition. "Provided that in case the licensee is a bona-fide exporter or is in the process of merger or acquisition, the licence shall be deemed to be valid for the purpose of export only, for a period of one year from the date on which the change has taken place. This period may however, be further extended on the recommendations of the Licensing Authority defined under clause (b) of rule 21 on case to case basis."

The issues came up for deliberations during the last DTAB meeting. After deliberations, the DTAB agreed to the proposed amendment.