SVKM’s NMIMS

SCHOOL OF BUSINESS MANAGEMENT

MBA-PHARMACEUTICAL MANAGEMENT

COURSE- Legal Environment of Organizations

NAME- ASIF AHMAD
ROLL- A001
DIVISION- A

DRUG REGULATION
WHY DRUG IS REGULATED?

Drugs are substances specifically recognised by an official Pharmacopeia and Formulary that are
approved for use to treat, diagnose, cure or prevent a disease or disorder. A medical substance
induces change to the function or structure of the patient’s body.

The regulation of drugs and medicine is crucial to the health and safety of the public. Ensuring
that a medicine is high quality is achieved by checking the efficacy, quality and safety of the
drug. The medicines are prepared, stored, manufactured and shipped according to health and
safety guidelines of professional and experienced chemists and pharmacists. The FDA (Food and
Drug Administration) and other health governing authorities prohibit illegal and unethical
production of drugs.

Regulation is important and followed continuously in every step and process that the drug
material passes through. These steps include: raw material handling, formula applications, lot
number maintenance, humidity, light and temperature control, storage, special packs for
sensitive drugs, SOPs for drug movement, refrigerator usage, legal documents and records,
shipping and handling, all of which are necessary for proper drug maintenance and for the safety
and health of the consumer.

Regulations for drugs should be under the control of the authorities. The national government
may be responsible for activating the national medical regulatory board, which is represented by
medical regulatory authorities (MRAs). The regulatory bodies are responsible for the ensuring
that all medicine production complies with the rules and regulations and ethical behavior
guidelines outlined by the local and international bodies. Decisions made by the authorities
should be clear and transparent; they should be made in compliance with the rules and
regulations to ensure the prosperity of the country.

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

HOW IT IS REGULATED ?

On December 12, 2014, the Department of Pharmaceuticals (DoP) of the Government of India
announced details of the ‘Uniform Code of Pharmaceutical Marketing Practices (UCPMP)’, which
would be effective across the country from January 1, 2015.

Just to recapitulate, the DoP came out with a draft UCPMP on March 19, 2012, inviting
stakeholders’ comments. Immediately thereafter, the officials at the highest level of the
department held several discussions on that draft with the constituents of the pharmaceutical
industry, Ministry of Health, Medical Council of India (MCI), besides other stakeholders.
Unfortunately, no decision on the subject was taken for nearly three years since then, probably
due to intense lobbying by interested constituents.

UCPMP is a voluntary code issued by the Department Of Pharmaceuticals relating to marketing

practices for Indian Pharmaceutical Companies and as well medical devices industry. It is
applicable on Pharmaceutical Companies, Medical Representatives, Agents of Pharmaceutical
Companies such as Distributors, Wholesalers, Retailers, and Pharmaceutical Manufacturer’s
Associations.

General Points
I. A drug must not be promoted prior to receipt of the marketing approval by the
competent authority, authorizing its sale or supply.
II. The promotion of a drug must be consistent with the terms of the marketing approval.
III. Information about drugs must be up-to-date, verifiable and accurately reflect current
knowledge or responsible opinion.
IV. Information about drugs must be accurate, balanced, fair, objective, and must not
mislead either directly or by implication.
V. Information must be capable of substantiation. Substantiation that is requested pursuant
to para 1.5 above must be provided without delay at the request of members of the
medical and pharmacy professions including the members of those professions
employed in the pharmaceutical industry.

Role of Medical Representatives

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

 I. The term "medical representative" means sales representatives, including personnel
retained by way of contract with third parties and any other company representatives
who call on healthcare professionals, pharmacies, hospitals or other healthcare facilities
in connection with the promotion of drugs.
II. Medical representatives must at all times maintain a high standard of ethical conduct in
the discharge of their duties. They must comply with all relevant requirements of the
Code.
III. Medical representatives must not employ any inducement or subterfuge to gain an
interview. They must not pay, under any guise, for access to a healthcare professional.
IV. Companies are responsible for the activities of all their employees including Medical
Representatives for ensuring compliance of the Code. This would be additionally ensured
by the companies through appropriate clause in the contract of the employment
between the companies and its employees/Medical Representatives.
V. Other third parties working for or on behalf of pharmaceutical companies, and those that
do not act on behalf of companies (such as joint ventures and licensees) commissioned
to engage in activities covered by the Code should also have a good working knowledge
of the Code.

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)
Guideline regarding Samples
I. Free samples of drugs shall not be supplied to any person who is not qualified
to prescribe such product.
II. Where samples of products are distributed by a medical representative, the
sample must be handed directly to a person qualified to prescribe such product or to a person
authorized to receive the sample on their behalf.
III. The following conditions shall be observed in the provision of samples to a
person qualified to prescribe such product:
a. Such samples are provided on an exceptional basis only
b) Such sample packs shall be limited to prescribed dosages for three patients for required
course of treatment;
c) Any supply of such samples must be in response to a signed and dated request from the
recipient;
d) An adequate system of control and accountability must be maintained in respect of the
supply of such samples;
e) Each sample pack shall not be larger than the smallest pack present in the market;
f) Each sample shall be marked "free medical sample — not for sale" or bear another
legend of analogous meaning;
g) Each sample shall be accompanied by a copy of the most up-to-date version of the
Product Information (As required in Drug and Cosmetic Act,1940) relating to that product

IV. A pharmaceutical company shall not supply a sample of a drug which is an anti-
depressant, hypnotic, sedative or tranquillizer.
V. The companies will maintain details, such as product name, doctor name, Quantity of
samples given, Date of supply of free samples distributed to Healthcare practitioners etc.

Guidelines regarding practice of giving Gifts

I. No gifts, pecuniary advantages or benefits in kind may be supplied, offered or promised
to persons qualified to prescribe or supply drugs, by a pharmaceutical company or any of
its agents i.e. distributors, wholesalers, retailers etc.
II. Gifts for the personal benefit of healthcare professionals and family members (both
immediate and extended) (such as tickets to entertainment events) also are not be
offered or provided.

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

Relationship with Healthcare Professionals

Travel facilities: Companies or their associations/representatives or any person acting on their

behalf shall not extend any travel facility inside the country or outside, including rail, air, ship, cruise
tickets, paid vacations, etc., to HealthCare Professionals and their family members for vacation or for
attending conference, seminars, workshops, CME programme etc. as a delegate. It is hereby
clarified that in any seminar, conference or meeting organized by a pharmaceutical company
for promoting a drug or disseminating information, if a medical practitioner participates as a
delegate , it will be on his/her own cost.

Hospitality: Companies or their associations/representatives shall not extend any hospitality like
hotel accommodation to Healthcare Practitioners and their family members under any pretext.

Cash or monetary grants: Companies or their associations/representatives shall not pay any cash
or monetary grants to any healthcare professional for individual purpose in individual capacity
under any pretext. Funding for medical research, study etc., can only be extended through
approved institutions by modalities laid down by law/rules/guidelines adopted by such approved
institutions, in a transparent manner. It shall always be fully disclosed.

Where there is any item missing, the code of MCI as per "Indian Medical Council (Professional
Conduct, Etiquette and Ethics) Regulation, 2002 as amended from time to time, will prevail.

PENALTY PROVISIONS
Once it is established that a breach of code has been made by a company, the committee
can propose one of the following decisions against the alleged company to the Head of the
Association for action:
I. To suspend or expel the company from the Association.
II. To reprimand the company and publish details of that reprimand.
III. To require the company to issue a corrective statement in the media (covering all media)
which was used to issue promotional material textual & audio visual; details of the

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

 proposed content and mode and timing of dissemination of the corrective statement
must be provided by the company to the committee for approval.
IV. To ask the company to recover items from the concerned persons, given
V. in violation of the code as stipulated in clauses 6 and 7; details of the action taken must
be provided by the company in writing to the Committee.

ANALYSIS

A survey report of Ernst and Young titled, “Pharmaceutical marketing: ethical and responsible
conduct”, carried on the UCPMP and MCI guidelines, highlighted some of the following points:

a) More than 50 percent of the respondents are of the opinion that the UCPMP may lead
to manipulation in recording of actual sampling activity.
b) Over 50 percent of the respondents indicated that the effectiveness of the code would
be very low in the absence of legislative support provided to the UCPMP committee.
c) 90 percent of the respondents felt that pharma companies in India should focus on
building a robust internal controls system to ensure compliance with the UCPMP.
d) 72 percent of the respondents felt that the MCI was not stringently enforcing its medical
ethics guidelines.
e) Just 36 percent of the respondents felt that the MCI’s guidelines would have an impact
on the overall sales of pharma companies.

Vagueness in measuring delivery of the deliverables:

Let me now get back to the UCPMP. As mentioned in the draft proposal of 2012, after six
months from the date of its coming into effect, the government would review the quality of
implementation of the UCPMP by the pharma players and their trade associations. If the same
is found unsatisfactory, the DoP may consider a statutory code, thereafter.

Interestingly, nothing has been mentioned in the UCPMP document about the process that
would be followed by the government to assess the quality of implementation of the Code after
six months prompting the DoP to take a very crucial decision, either way.

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

Vagueness in monitoring UCPMP:

The UCPMP of the DoP states, the Managing Director/CEO of the company is ultimately
responsible for ensuring the adherence to the code and the executive head of the company
should submit a self-declaration within two months from the date of issue of UCPMP.
Thereafter, within two months of the end of every financial year, the declaration needs to be
submitted to the respective industry associations for uploading those on the Associations’
websites. These declarations must also be uploaded on the website of the respective
companies.

As we know, there are several thousands of pharma marketing players in India. Many of these
players, especially those in the micro and small-scale sectors, including their trade associations,
do not maintain websites either. Thus, it would be interesting to know how does the DoP
monitor such declarations bi-monthly in the six months’ time, to start with.

Lack of strong deterrents and cumbersome process:

There are no strong deterrent measures in the UCPMP to minimize flouting of the code, nor
would the complaint filing process encourage any victim with relevant details, such as patients,
to lodge a complaint after paying non-refundable Rs.1, 000. It is beyond an iota of doubt that
patients are the ultimate victims of most of sales and marketing malpractices by the pharma
players.

Moreover, this non-refundable money would ultimately go to whom and how would it be used
are still unclear.

CONCLUSION:

December 12, 2014 announcement of the UCPMP in its self-regulatory mode sends a message
of good intent of the government to curb pharma marketing malpractices in India, which are
threats to the society.
However, I reckon, the document is rather weak in its effective implementation potential.
Meaningful and transparent deterrent measures to uphold public health interest are also
lacking. The entire process also deserves a well-structured monitoring mechanism and digital
implementation tools that can be operated with military precision.

SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)

It also raises a key question – Is this UCPMP good enough, especially after witnessing that self-
regulation in pharma marketing practices is not working in most countries of the world?
In that sense, would the UCPMP, in its current avatar, with weak enforcement potential, shorn
of enough deterrent against violations and commensurate sanctions, be able to deliver the
requisite deliverables is a big question.

References:

https://pharmaceuticals.gov.in/sites/default/files/Uniform%20Code%20of
%20Pharmaceuticals.pdf
http://www.tapanray.in/indias-pharma-marketing-code-ucpmp-is-it-crafted-well-enough-to-
deliver-the-deliverables/
https://www.insightsonindia.com/2020/02/07/uniform-code-of-pharmaceuticals-marketing-
practices-ucpmp-code/
http://www.nishithdesai.com/fileadmin/user_upload/pdfs/Research_Papers/Uniform-Code-
for-Pharmaceutical-Marketing-Practices_Decoded.pdf

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SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)
SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)
SVKM’S NMIMS MBA (PHARMACEUTICAL MANAGEMENT)