The Central Drugs Standards Control Organisation (CDSCO) has recently released a list identifying 53 drugs as Not Standard Quality (NSQ), which has raised significant concern within the pharmaceutical industry. The list includes essential medications from reputable companies like Alchem, Sun Pharma, and Glenmark, highlighting a pressing issue regarding drug quality in India.

However, these companies assert that the flagged batches were not manufactured by them, instead labeling them as spurious.

According to Gangadi Madhukar Reddy, MD and CEO of MedPlus Health Services, Not Standard Quality (NSQ) drugs typically refer to medications that do not meet the defined standards of quality set by regulatory authorities. He added that NSQ drugs may arise due to issues like labeling errors, incorrect ingredient concentrations, or slight variations in the dissolution profile of active ingredients. For instance, if a medication is required to contain 100 mg of an active pharmaceutical ingredient (API), it might be found to have a concentration ranging from 95 mg to 105 mg, which could prompt a classification as NSQ.

Reddy emphasised that reputable manufacturers often adhere to stringent operating procedures, making the likelihood of producing NSQ drugs among top brands relatively low.

In contrast, spurious drugs are counterfeit products that may contain harmful or ineffective substances. They can be fake copies of genuine medications, lacking the active ingredients they claim to have, or they might include entirely different substances altogether.

Rajeshwari Hariharan, Counsel at Delhi High Court, describes spurious drugs as those “where the drug is either adulterated or the active ingredient is completely different.” For example, a spurious antibiotic may not contain any antibiotic properties at all, rendering it not just ineffective but potentially dangerous.

Hariharan highlighted that the penalties for manufacturing spurious drugs are severe. Under the relevant laws, manufacturers can face criminal charges, and the consequences may include jail time for directors and the potential seizure of their factories.

The Indian Pharma Alliance (IPA), which represents 23 major pharmaceutical companies, also emphasised the critical need to distinguish between NSQ and spurious drugs. Mixing these categories can unjustly tarnish the reputations of legitimate manufacturers, harming their credibility and undermining India’s standing as a reliable drug exporter.

According to Reddy, many small retailers inadvertently contribute to the spurious drug problem by sourcing from wholesalers rather than directly from manufacturers. This practice increases the risk of unknowingly selling counterfeit medications. MedPlus Health Services mitigates this risk by procuring products directly from manufacturers, ensuring authenticity, he added.

Both Reddy and Hariharan, stressed that the solution lies in combining stringent laws with effective consumer education. The introduction of technological interventions, such as QR codes on packaging, could empower consumers to verify the authenticity of the drugs they purchase, ensuring that they receive genuine products.

Below is the verbatim transcript of the discussion.

Q: You have around 4,400 pharmacies that you run across India. Give us a sense in terms of whether you all have tackled this spurious drugs problem at your pharmacies and how does one recognise it?

Reddy: We have been looking at this problem from the time we started, and the way we tackle it is, we work directly with the companies in procuring the products. A lot of times, small retailers who can’t have access to the distributor or the CNF agent end up buying through wholesalers and small third party sellers from where they end up actually getting this fake drugs.

So for us, given that we buy directly, we have not seen the problem at all.

Q: If you could just give us a sense in terms of how serious this issue is, which the CDSCO has flagged off about these 53 drugs, many of them from very legitimate companies, such as Sun Pharma and the rest?

Hariharan: The kind of drugs that the CDSCO has now banned is a different category altogether. These are drugs which are combinations. So what has now been banned is a combination of an existing drug. So this is not necessarily a spurious drug.

Now, when you talk about spurious drug, that’s a completely different category. Spurious drugs are those where the drug is either adulterated or the active ingredient is completely different, or it is somehow mixed. It’s not the actual thing, which is promised to be. So for example, if they’re supposed to be selling antibiotics, then the drug in the container will not actually contain antibiotics, it might just contain something else, or it might be adulterated with something, or it might just have completely different ingredients, or it might have been expired, that is the category of spurious drugs.

The ones that the CDSCO has now banned are drugs which are of good quality. But they are in the market for some time, but people have made combinations. So they’ve made a combination of maybe an antibiotic with some other cough drug or something like that. So it’s just a combination which the CDSCO has banned.

Q: I just want you to help us differentiate between what is a not-standard-quality (NSQ) drug, because that could be even just labelling issues, and what is the penalty for, say, manufacturing a spurious drug?

Hariharan: Penalty for manufacturing a spurious drug is quite drastic under the act. In fact, if you are caught having spurious drugs, then the act provides for criminal action. In fact, your director can be behind the bars, so that’s very serious. Your factory can be seized, it can be locked. So there are very serious consequences of selling spurious drugs.

So a spurious drug are the ones which have either expired or it has adulteration, something like that. That is spurious drug.

Q: Of the sales that you do, what are the overlaps between, say, something like, not of standard quality and how do you tackle that menace? One understands that spurious drugs can be taken care of by buying directly from the company or authorised dealers from the company, which someone like you with over 4,000 stores are able to do that. But of drugs which are of not standard quality or some of these combinations which may not be approved, how do you tackle that and what proportion, according to you would be that in the overall market?

Reddy: So again, the differentiation is between fake. Some XYZ company makes a drug and basically sells it off as a Sun Pharma or a Dr Reddy’s or whatever brand out there. Very easy to do that because today packaging industry has come a long way. It’s very difficult to make out what the drug is inside that. And the fact that there are 10,000 odd manufacturing companies, I’m pretty sure a lot of them really don’t have significant business. A lot of these guys will fall prey to this, will go and basically make it for someone. And it’s very easy to actually get that done. So that is a different class of drug altogether because that’s the fake drug. We don’t let that ever come into our system because we’re buying directly from the company.

On the not standard quality, that’s a different story altogether. It’s almost impossible to tell. And I’m assuming that any of the top brands out there will always be of standard quality. I don’t think there’s any problem at all. The top brands, they make these in the best qualities, best kind of settings possible. They have standard operating procedures out there. We ourselves have seen that a lot. We ourselves get our own drugs made in the same practice in which these guys get them made. I don’t think there’s any problem out there. But once in a while, once in a while there could be something out there and those are easily recalled. And not of standard quality could mean, let us say the dissolution profile is not exactly right or maybe the assay is not showing the exact amount of quantity of drug which is required. 95 to 105% is the amount of API required in a drug so it could be slightly lesser and so someone in a random check can pull it. But I haven’t seen any instance in which a top brand has been basically pulled up for NSQ.

It is possible that someone has found the drug and said this top brand is actually not of the right quality but that that in my mind is probably because that company never even made the drug, someone else made it and passed it of as this company’s drug.

Q: I just wanted to understand that you all have a private label that you’ll sell drugs through as well. So now how do you ensure that there’s no kind of contamination, no kind of spurious drugs coming through? Do you have a QR code which you implement on all of your drugs? Or is it going against the ethos that you want to keep your costs low? So how exactly do you ensure this?

Reddy: For us, when it is our own drug, it is the most tightly integrated supply chain. We’re going directly to the company, we’re making sure they’re making it the right way. After they test it, we also test it. Then it goes into our system, and it is sold only in our stores. So the MedPlus drug is not sold anywhere else at all. So, if you are buying a Medplus drug from the Medplus store, there is absolutely no chance of it being a fake.

And as far as quality is concerned, we are getting them made in the same factories in which all the top companies are getting them made. In fact, 90% of our stuff is just made in our own four factories, and these are four of the best contract drug manufacturing companies in the country, on par with anything else in the world. So, we get all of these made, so we’re very, very sure about the quality. And we’re not selling elsewhere. No one else is selling MedPlus drugs. So, you can be sure if you’re buying a MedPlus drug, it is guaranteed to be genuine.

Q: ASSOCHAM report indicates 25 out of 100 drugs in India are spurious. Can you give us a sense, how do we curb this menace? Do you need to sort of strengthen your penalties when it comes to spurious drugs? Where does one need to sort of strengthen the supply chain?

Hariharan: We have to, I think, tackle it on both fronts. One, we need to have more stringent laws. And as soon as we find a counterfeit or a fake drug, we need to take extremely stringent action. Second, with regard to the drug per se, so that the consumer is able to find out whether it is a fake or not, probably on the packaging you need to have some kind of technology integrated system, so that the consumer will be able to know that drug which I am purchasing is actually a genuine one. So we should be able to indicate it in some way through technological intervention.

Ultimately it is the consumer, who is affected by this and consumer is the one who is going to suffer. So that’s the reason why at both ends we need to tackle it. And perhaps this should also become part and parcel of the law.

I believe the drug controller and the pharma companies are working towards that, because pharma companies want the consumer to get genuine drugs. I don’t think there’s a single good pharma who wants really bad drugs to come to people.