Indian industry acknowledges some compliance shortcomings, survey finds

Print 08 June 2015
Eric Palmer / FeircePharmaManufactoring

The FDA has banned nearly two dozen plants operated by Indian drugmakers in the past two years, leading some in India's industry to complain that the FDA has it in for the country's drugmakers. It is a contention that the FDA denies. Now, a new survey by a private consulting firm shows that a lot of industry insiders in India recognize there are shortcomings in compliance at their companies.

The survey from Deloitte found that 55% of those responding believed their compliance teams were not sufficiently trained, BusinessToday reports. The survey, "Managing Growth Through Better Compliance Management," got responses from 33 pharma groups in the country, the newspaper said. More than 60% believed lax internal controls were a big problem, and 42% said a lack of skilled people to manage compliance was a key drawback. 

India's problems with regulators may very well have much to do with the constantly evolving regulations, Deloitte said. Most regulatory agencies have implemented new standards in the past two years, it said, and India may be having trouble finding the professionals needed to stay on top of, and manage, these changes. It takes time to train people in new standards. "In the interim, companies could be exposed to vulnerabilities arising from non-compliance," Rohit Mahajan, senior director of Deloitte Touche Tohmatsu India, toldBusinessToday.

Nearly half of respondents said that their companies were not putting sufficient money into compliance, a response that Deloitte found particularly telling. This lack of investment suggests that top management may not view compliance problems as a high risk that can carry significant consequences, the consultant concluded.

India has some very prominent examples of what can happen when regulators, particularly the FDA, find fault with manufacturing compliance. Ranbaxy Laboratories spent years trying to work its way out of issues that resulted in two key plants being banned and the company signing a consent decree and spending $500 million to settle civil litigation with the government. When the FDA banned two more of its plants for manufacturing and data shortcomings, parent Daiichi Sankyo threw up its hands and sold the company at a loss to Sun Pharmaceutical, which has pledged to bring the company's plants into compliance. Wockhardt, another big Indian drugmaker that had two plants banned by the FDA in 2013, has had its earnings hammered by having its access to the world's largest pharma market limited. It reported this week that sales last year in the U.S., its largest market, were off by 50%.

India, urged by former FDA Commissioner Margaret Hamburg to step up its oversight, has responded with plans to hire more inspectors and do more training. Meanwhile, the FDA has been beefing up its own inspection staff in the country. It says that is not an indication it has singled out the country for oversight, just an acknowledgement that about 40% of the generic and over-the-counter drugs sold in the U.S. come from India, second only to what the U.S. gets from Canada.

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