Over 60% of India's Pharma SMEs at Risk of Closure Over GMP Compliance

Economic Times
Economic Times
10h ago
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Over 60% of India's pharma SMEs risk closure by December 31 for not complying with updated GMP rules, threatening drug shortages and jobs.
Over 60% of India's Pharma SMEs at Risk of Closure Over GMP Compliance
A What happened
India's pharmaceutical sector includes about 12,000 drug manufacturing units, with 8,500 SMEs facing a compliance deadline for tighter good manufacturing practices under revised Schedule M rules by December 31. Most SMEs, operating single facilities and burdened by limited capital, are unlikely to meet these standards. Closure of these units could disrupt manufacturing of key medicines such as antibiotics, anti-inflammatory drugs and diabetes treatments, affecting domestic supply especially to tier-II and tier-III cities and exports to low- and middle-income countries. This threatens medicine security, hundreds of jobs, and the pharma supply chain. The government has not extended the deadline despite industry requests and states are tasked with stricter enforcement.
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Key insights

  • 1

    Structural fragility of India's pharma SMEs: Most small pharmaceutical producers lack capital to upgrade facilities per stricter GMP norms, showing structural financial vulnerability in a key medicines supply segment.

  • 2

    Risk to medicine security beyond India: Closure of compliant-challenged SMEs can create shortages domestically and impact exports crucial to low- and middle-income countries reliant on Indian generics.

  • 3

    Trade-off between quality standards and supply continuity: Stricter quality enforcement improves drug safety but risks drastic supply disruption when many SMEs cannot comply, revealing tension between regulation and access.

Takeaways

India faces a critical juncture balancing drug quality enforcement with maintaining supply from financially fragile SMEs. The immediate risk is medicine shortages and disruption to health systems locally and globally.

Topics

Health & Medicine Medicine World & Politics Policy & Regulation