Drug License

Analysis of New Draft Bill 2022 for drugs and medical devices

calendar11 Aug, 2023
timeReading Time: 8 Minutes
New Draft Bill

In India, the healthcare and medical equipment industries have seen significant growth during the past ten years. According to reports, India has a 250-crore medical device business that accounts for just 6 per cent of the country’s overall healthcare market. The fourth-largest medical device market in Asia is found in India, where the USD 10 Billion medical technology market is expected to grow to USD 50 Billion by 2025.

Barriers to the present regulatory system include a lack of a regulatory environment, norms and guidelines, poor penetration, significant capital expenditure, and a lack of active government involvement. As a result, regulatory agencies have realised the necessity to create regulations and approval procedures as well as quality benchmarks that are on par with international norms. The Drugs, Medical Devices, and Cosmetics Bill, 2022, a proposal of which was made public by the Ministry of Health and Family Welfare in July 2022, aims to update, replace, and modernise the antiquated Drugs and Cosmetics Act 1940. The ministry has been steadily reviewing and streamlining the regulations to reflect the changes better and adopt new technology. The Drug Controller General of India, Mr V.G. Somani, led an eight-member committee established by the Ministry of Health and Family Welfare to create the proposed law, which has since been posted on the ministry’s website for comments and ideas from stakeholders and the general public. The main goal of the proposed New Draft Bill is to provide comprehensive laws to guarantee that medical products marketed in a nation are safe, effective, and fulfil established standards of quality. As the former Act does not cover the same issue, one of the key reasons for introducing this Bill is to regulate medical devices and the makers of medical devices.

What is New Draft Bill 2022 for the pharmaceutical sector?

The Drugs and Cosmetics Act, enacted by Parliament in 1940, primarily governed the import, production, distribution, and sale of medications and cosmetics across the nation. The rate at which India’s healthcare sector has grown, placing it as the fourth-largest medical technology sector in Asia. The pre-independence legislation had many gaps and hurdles, which made it difficult to ensure that regulatory approval procedures, quality benchmarks, and guidelines were up to pace with international standards.

The Drugs and Cosmetics Act of 1940 is weak and out-of-date, so the Ministry of Health and Family Welfare[1] proposed a draft of the Drugs, Medical Devices and Cosmetics Bill, 2022 in July 2022 with the intention to evaluate, replace, modernise, and remodel the old Act. The ministry has been consistently reviewing and streamlining the rules to adopt the new technology further, accommodate the changes, and consolidate the law relating to importing, manufacturing, distributing, and selling cosmetics. For the purpose of writing the law, the Ministry of Health and Family Welfare formed an eight-person committee under the direction of Mr V.G. Somani, the Drug Controller General of India (DCGI).

  • What is the prime objective of the New Draft Bill?  

The Act (Drug and Cosmetic Act of 1940) was passed before independence and did not consider the sporadic legal, medical, and technical improvements that have taken place over the past several years. The main goal of the New Draft Bill is to take these changes and modifications into account. While explaining the need for the New Bill, the ministry said, “We comprehend the need for the Act to be amended and consolidated in order to reduce the potential for conflicts that may arise when interpreting the Act and the rules that have been introduced in recent years to regulate medical devices, clinical trials, cosmetics, and the proposed law for online pharmacies.”

The Proposed Bill is the first step towards changing India’s current approach to regulating drugs and cosmetics. Even though it aims to update the D&C Act, the majority of it is a direct replica of current law. Although repeating the existing legislation, the Draft Bill’s changes, omissions, and aims are anticipated to raise expectations for stakeholders, consumers, and quality.

  • Reasons for the need of a comprehensive Bill

Three factors were cited by the National Institute for Transforming India (NITI) Aayog as the main justifications for a new, distinct regulation for medical devices. As per NITI Aayog, ‘The Drugs and Cosmetics Act of 1940 is outdated, so it cannot regulate medical devices in a robust and wholesome manner; lack of human expertise in the Central Drugs Standard Control Organization (CDSCO) to assess the efficacy and safety of medical devices; professionals in the CDCSO have chemical-based knowledge that only applies to pharmaceuticals and lack of knowledge regarding the complex electronic technology that some medical devices come with; and outdated legislation that prohibits the marketing of medical devices to minors’.

As India is considered to have an indigenous medical device sector valued at INR 250 crore and expected to develop even further, it was, in fact, the ideal moment to alter the legislation and establish laws for clinical trials and investigations for pharmaceuticals and medical devices.

Another reason is the second schedule of the precolonial era act (Drugs and Cosmetic Act). In the present Act, there are no standards for medical devices, and there is no provision to punish a maker of medical devices because the Drug and Cosmetic Act only recognises legally enforceable standards for medications. The new regulation’s proposed clause is intended to control the use of medical devices, cosmetics, and clinical studies, among other things.

Key highlights of the New Draft Bill

  • New definitions: The proposed Bill adds a number of new definitions or provisions in Chapter I for greater clarity, efficient operation, and effective implementation, including medical device, drug, new drugs, over-the-counter (OTC) drugs, cosmetics, adulterated cosmetics, bioequivalence study, bioavailability study, clinical trial, clinical investigation, controlling authority, manufacture, and others.
  • Medical devices: Should be handled independently and apart from Drugs: Presently, all medical devices are classified as drugs and are governed by the Pharmaceuticals and Cosmetics Act and the Medical Devices Rules of 2020. The proposed Bill now wants to remove the present restrictions and proposes a new definition for medical devices placing them outside the jurisdiction of ‘Drugs’. In addition, Chapter II of the proposed Bill recommends the formation of a Medical Devices Technical Advisory Board (MDTAB), independent from the Drug Technical Advisory Board (DTAB), to advise the Central Government on technical topics.
  • Constitution of the Drugs, Medical Devices and Cosmetics Consultative Committee: To provide advice to the Central Government, State Governments, the Pharmaceuticals Technical Advisory Board, and the Medical Devices Technical Advisory Board on any topic and to ensure consistency in the administration of this Act and the rules enacted thereunder across the nation. The Chairperson of the aforementioned Committee shall be the Drugs Controller General of India (DCGI).
  • Chapter III: Chapter III is concerned with the standards established for the import of pharmaceuticals and cosmetics. Chapter IV is concerned with the production, sale, and distribution of medications and cosmetics, as well as drug clinical trials. Chapter VI, on the other hand, is concerned with standardising the import, manufacturing, sale, and distribution of medical equipment, as well as clinical research.
  • Under Chapter V: Under Chapter V of the proposed Bill, there is a separate chapter for Ayurveda, Unani, and Siddha medications and cosmetics, which are currently covered by the D& C Act. Furthermore, for the first time, such chapter wants to control Sowa Rigpa and homoeopathy, including standardising its import, manufacturing, sale, distribution, and clinical study of such items.
  • E-pharmacy: A law to govern the largely unregulated and ever-growing field of e-pharmacies will be proposed for the first time. The proposed Bill currently tries to govern e-pharmacies, and it is expressly stated that no person shall sell, stock, show, offer for sale, or distribute any medicine via online method (e-pharmacy) unless under and in compliance with a license or authorisation given in such way as may be stipulated. Nevertheless, the New Draft Bill does not address the mechanism and rules for granting licences to e-pharmacies, which may be established after consultation with the Central Government.
  • Provisions to name or create medical device testing centres for the purpose of reviewing and testing medical devices for regulators and businesses have also been incorporated in the new proposed Bill.
  • The Central Government-appointed Central Drug Regulatory Authority for Ayurveda, Siddha, Sowa-Rigpa, Unani, and Homoeopathy pharmaceuticals and cosmetics must control the manufacturing and distribution of such drugs and cosmetics. The Central Regulatory Authority shall also construct, at the state level, such infrastructure as the Central Government may specify in order to effectively implement the provisions of this Act for the quality assurance of such medications and cosmetics.

New provisions with respect to clinical trials introduced

Johnson and Johnson’s faulty hip implants case (2018), which exposed the toothless regulatory provisions of the Drugs and Cosmetic Act of 1940, forced the government to enact rules and regulation which talks explicitly about Clinical trials in India. The following clauses have been added under the New Draft Bill regarding clinical trials:-   

  • The Medicines and Clinical Trial Regulations, 2019 are currently the sole regulations in this area. The proposed Law now includes a distinct Chapter for clinical trials and inquiry. The proposed Bill makes clinical trials or clinical studies of pharmaceuticals and medical devices illegal unless approved by the central licencing body.
  • In the interest of public health or during a drug emergency time, the Central Government has been authorised to develop procedures for the Central Licensing Authority to waive the need for clinical studies for the manufacturing or import of new pharmaceuticals or experimental new remedies in the country.
  • The proposed Bill places the onus on the investigators to provide medical care for any injuries sustained during the trial.
  • The proposed Bill provides for compensation for participants or their legal heirs who are injured or killed while participating in clinical trials and investigations for pharmaceuticals and medical devices.
  • If the compensation is not paid, there is a new provision for imprisonment and a fine equal to double the compensation sum. This is considered as a positive move because monetary compensation of a few lakhs has not been a deterrent for large corporations conducting trials until date, however incarceration may be.

Clauses regarding the penalty under New Draft Bill

The proposed Bill has replicated most of the offences of the existing Drugs and Cosmetic Act of 1940; however, in order to make the punishments more stringent, the New Draft Bill enhances the period of imprisonment between 1-10 years which may extend to life imprisonment and amount of fine up to INR 15 lakhs for any contravention of provisions of the Bill. Additionally, the Bill introduces penalty provisions for clinical trials and clinical investigation without permission, and for failure to provide compensation for injury or death related to clinical trials.

Comparison between the New Draft Bill & Act of 1940

The Bill proposes to create independent authorities and boards to take decisions on the regulation of medical devices in India. The key comparative move between the New Draft Bill and the Act of 1940 has been described in the below table:

ParticularsDrugs, Medical Devices and Cosmetic Bill of 2022Drugs and Cosmetic Act of 1940
Constitution of Technical Advisory Board State drugs laboratories and State Medical Devices Testing Centres in India.Advisory Boards for Drugs and Medical Devices are to be constituted separately. State Drug Laboratories and Medical Devices Testing Centres are to be constituted within all the states.Under the present Act, only the Single Drugs Technical Advisory Board is constituted. Provisions for the states to establish drug laboratories for testing are not covered under the 1940 Act or 1945 Rules.
Prohibition of import of certain cosmetics.The New Draft Bill prohibits importing cosmetics that are not of standard quality or are misbranded, adulterated or spurious.Under the current Act, there is no such provision for the prohibition of the import of adulterated Cosmetics prescribed in the Act.
Prohibition of online sale of Drugs and Cosmetics.Under New Draft Bill, there is a prohibition on the sale of drugs and cosmetics through online mode without obtaining a license.The Act has no such provisions to regulate the online sale of drugs and cosmetics.
Prohibition of manufacturing of New Drug.The New Draft Bill prohibits manufacturing any new drug without obtaining a license.No such restriction was prescribed in the 1940 Act.
Police to assist Drugs Control Officer.Under the New Draft Bill, a police officer can assist the Drugs Control Officer in demanding his assistance in the investigation and preventing the escape of suspected offenders.Under the Act of 1940 there is no such equivalent provision.
Scientific Research BoardUnder the New Daft Bill, Scientific Research Board will be established to support the regulatory authority on the scientific advances used for developing and innovating Ayurveda, Siddha, Sowa-Rigpa, and Unani drugs Homoeopathy.The act does not talk about the establishment of a Scientific Research Board.  


Currently, drug manufacturing, distribution, and importation are all governed under the Drugs and Cosmetics Act of 1940. The fundamental objective of the legislation is to guarantee that all medicines and cosmetics marketed in India are secure, efficient, and adhere to global standards. It also emphasises the clinical evaluation of experimental medical devices and the assurance of novel pharmaceuticals’ quality, safety, effectiveness, and performance. Lastly, it puts guidelines and limitations on medicine imports designed to safeguard the public’s health.

In July 2022, the Indian Ministry of Health and Family Welfare presented a Draft Bill to replace the existing Drugs and Cosmetics Act of 1940 (D&C ACT) in order to adopt the changing requirements and stimulate the adoption of new technologies. The revision of the D&C Act is a good and long-overdue step. Under the current regime, the distinction between allopathic pharmaceuticals, cosmetics, Ayush products, and medical equipment removes the industry’s anonymity and ambiguity.

The New Draft Bill focuses on regulating medical devices as a distinct category. It also recognises the importance of independent regulatory authorities with technical expertise in medical devices. In this aspect, the Draft Bill is perfect for the sector. The MDR, on the other hand, may need to be modified in order to be consistent with the Draft Law.

Read our Article: CDSCO Registration For Obstetrical And Gynaecological Medical Devices

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