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Pharmaceutical Export from India: Know the Legalities

calendar13 Dec, 2022
timeReading Time: 4 Minutes
Pharmaceutical Export from India: Know the Legalities

The Indian pharmaceuticals industry is poised at the third position in terms of global production. And in terms of overall valuation, it sits at the 13th position. India is now recognized as a global production and research hub. The Indian drug sector is anticipated to grow at a CAGR of 22 percent, with an overall valuation of US 55 billion dollars by 2020. Generic drugs rule the Indian drug sector, which comprises almost 70 percent of the market. Meanwhile, “over-the-counter” medicines and patented medicines accounted for 21% and 9%, respectively. Given the present growth and global presence, the pharmaceutical export from India can help manufacturers to reap additional profit. The drug export business is profitable, but it revolves around hefty compliances. This write-up will take a close look at the legalities around pharmaceutical export from India, along with other facts.

A Market Analysis of Pharmaceutical Export From India

Following is the market analysis of pharmaceutical export from India:

  • Pharmaceutical export from India accounted for 17$ billion in 2017-18. It is anticipated to grow by 50% to reach a market valuation of 25$ billion by the end of the year 2025.
  • India exports drugs to Africa, North America, the EU, Latin America, the Middle East, and other European regions. Almost 2/3rd of India’s export finds their way to Europe, NAFTA, and Africa. The top five export avenues for the Indian drug sector in 2021-22 were USA, Russia, UK, and Nigeria.
  • USA, Russia, and the UK are among the frontline importers of Indian drugs with a share of 29%, 2.4%, and 3%, respectively 2021-22. India’s export of drugs to these nations in 2021-22 was: the USA with $7101 m, the UK with $704 m, South Africa with $612 m, Russia with $597 m, and Nigeria with $588 m.
  • India’s drug shipping to the USA in value has thrived at a CAGR of almost 7 percent over the past three years. Besides, for Russia and UK, it thrived at a CAGR of 4% and 7.2 %, respectively over the same timeline.
  • As of August 2021, the no. of USFDA-certified units stood at 741. Also, the number of ANDs won by the Indian-based companies till Dec 2020 stood at 4,346. USFDA vetting was not performed during the past few years owing to the COVID-19 outbreak; however, the vetting has now become active and is anticipated to further augment Indian exports to the USA.

Common permits required for pharmaceutical export from India

The following are some common permits required for pharmaceutical export from India:

  • Import-Export Code (granted by the Directorate General of Foreign Trade)
  • Certificate/NOC granted by the State licensing authority operating under CDSCO
  • RCMC certificate accorded by Pharmaceutical Export Promotion Council
  • Drug manufacturing license accorded by CDSCO
  • Exportation documents such as proforma invoices, commercial invoices, bills of lading, packing list, certificate of origin, and letter of credit

How to start pharmaceutical export from India?

  • The first step is to approach DGFT to apply for Import Export Code
  • Get in touch with the prospect interested in importing Indian-based pharmaceutical products.
  • Avail of the required approval from the importing nation before shipping the consignment.
  • Get the export certification/NOC from the licensing authority i.e. Drug Controller General of India.
  • Select the viable shipping method. Don’t forget to take the importer’s consent for the same. Some widespread shipping methods include Expedite Shipping, international freight, etc.
  • Prompt the importer to send the Purchase order enclosing the type and amount of drugs. In response, the exporter should send the proforma invoice, which must include details concerning packing type, product pricing, and freight information.
  • Team up with a freight forwarder to ship the consignment
  • Complete the paperwork like the bill of lading, packing list, commercial invoice, etc.
  • After availing of clearance, the consignment will make its way to the importing nation, wherein custom checks shall be performed.

Role of the Drug Controller Office’s NOC in drug export

Drug exports outside India require a legal permit in the form of a NOC granted by the Drug Controller Office of India. Without this, no manufacturers can ship their pharma products abroad. In India, this NOC is only available to registered drug manufacturers. The State Licensing Authority (operating under the aegis of the Central Drugs Standard Control Organisation) can accord such a NOC. The applicant can head to the zonal office of the CDSCO to apply for this export NOC.

Understanding the significance of PHARMEXCIL’s permits in drug export

PHARMEXCIL (Pharmaceuticals Export Promotion Council of India) is a government institution accountable for advocating drug exports from India. Launched in 2004, the PHARMEXCIL falls under the ambit of FTP (Foreign Trade Policy).  PHARMEXCIL often releases various schemes and initiatives for strengthening the cross-border presence of Indian drugs. The institution seldom organizes events for domestic and international drug companies to boost cross-border trade. Exporters intending to leverage such opportunities need to apply for PHARMEXCIL Registration.

As a trade promotion organization, PHARMEXCIL performs the following functions:

  • Represent Government at domestic and international levels to identify ideal solutions for widespread problems concerning the drug industry.
  • Bolster Government in devising export-friendly policies.
  • Accord legal documents to exporters such as COI  and Registration cum Membership Certificate, aka RCMC.
  • Organize seminars and events concerning export-related subject matters.
  • Help members to avail of Market Access incentives (MAI) claim from the GOI.
  • Organize export meets in India and abroad
  • Organize Trade delegations abroad

As of now, Pharmexcil’s services to access the following products:

  • Active Pharmaceutical Ingredients (API)
  • Herbal/ Ayurveda
  • Finished Dosage Forms (FDF)
  • Siddha
  • Unani[1]
  • Homoeopathy
  • Diagnostics
  • Biologics
  • Surgical
  • Collaborative Research
  • Nutraceuticals
  • Clinical Trials & Consultancy
  • Contract Manufacturing
  • Regulatory Services

Labelling Norms to Ponder for Shipping Drugs abroad

Drugs and Cosmetics Act 1945 entails the following norms concerning the labelling of drugs to be shipped abroad. Every exporter must take these norms into account before starting pharmaceutical export from India.

Labels on packages of pharmaceutical products should be in line with the norms of the importing nation. The label must be legible and reflect the following particulars without fail;

  • Drug’s name;
  • The name, and address of the drug makers
  • The license number of the drug manufacturer
  • Batch or lot number

Conclusion

India is all set to become a global hub for drug manufacturing and research. Owing to competitive pricing and on-par quality, the demand for Indian drugs is escalating rapidly every passing day. This underpins an ideal opportunity for drug manufacturers to reap more profit via pharmaceutical export from India. The compliance requirement for drug export in India is quite stringent. Therefore, adhering to underlying norms is of paramount importance for drug producers and exporters. It would be helpful to avail of professional help before shipping drugs abroad.

Read Our Article: How to Export Medicine Globally from India?

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