India is set to replace its current law governing drugs, cosmetics and medical devices with a new set of rules, even as device makers demand separate legislation for them.

The Drugs & Cosmetics Act 1940, the country’s rule book to regulate all the three sectors, had its latest makeover early last year through an amendment to broaden the scope of medical devices regulation.

What made the Medical Devices (Amendment) Rules, 2020 a necessity was the exponential rise in the number of devices which were getting out of the purview of regulation. Because the pre-amendment rules allowed to monitor only select categories of medical devices.

Even post amendment, the agency can regulate the standards of quality and safety of only those medical devices which are notified by the government from time to time as “drugs.” Hence, the products which are yet to be made “notified medical devices” continue to remain out of the regulator’s domain.

Therefore, the need for establishing a well-defined, comprehensive framework for the increasingly complex medical devices and diagnostic equipment sector has become so compelling for policymakers.

Moreover, the pharmaceutical, as well as the cosmetic industries, have been urging the government to revisit the current laws as they find many of the provisions of this “age-old” laws obsolete.

The health ministry already initiated the process by setting up a committee last month chaired by the Drug Controller General of India, the country’s top drug regulatory authority, to review the existing rules and draft a set of new laws.

The 8-member committee has representations from various state-level drug regulators apart from members from the health ministry. The draft legislation is expected to be ready by the end of November.

“The Committee shall undertake pre-legislative consultations and examine the present Act, previously framed Drugs and Cosmetics Bills and submit a draft document for de-novo Drugs, Cosmetics and Medical Devices Bill by 30.11.2021,” said the order issued by the health ministry notifying the constitution of the committee.

The new laws will lay down the governing principles for the emerging avenues such as e-pharmacy while removing the ambiguities in several sections such as the compensation norms for clinical trials and emergency use authorizations, reports said quoting health ministry officials.

Even as the proposed legislations look to bring these related but diversified pharmaceuticals, cosmetics and med devices segments under the ambit of a unified regulatory framework, various stakeholders in the sectors rue that they have been totally left out of the decision-making process.

Experts also underline the importance of cooperation between industry and the regulator while framing new rules. The presence of the industry representatives is mandatory in the committee as there are many rules that the industry faces problems adhering to.

Regulations are meant for the industry and trade and hence the committee is not complete without representation of these crucial stakeholders, they argue.

The medical device makers are perhaps the most aggrieved lot. They have been urging for a separate set of legislation for medical devices for a long time. Devices are different and cannot be regulated as drugs, as is done in India.

The concern is that the lack of clarity in regulations is stifling the growth of the highly promising medical devices industry. A separate law will go a long way to help allay the confusion surrounding medical equipment regulation and boost indigenous manufacturing by fostering investment. As home-grown manufacturing grows, the dependency on imports of devices will reduce.

India’s $11 billion (2020) medical devices market is expected to expand at a CAGR of 35.4% to $50 bn in 2025, according to India Brand Equity Foundation (IBEF), a knowledge center under the Ministry of Commerce and Industry, Government of India.

However, as much as 80% of the domestic requirement is met through imported devices. This leaves a huge gap in the demand and supply and provides a significant opportunity for device manufacturers.

Foreign investment in the medical devices sector has increased 98% YoY to $301 million from about $152 million a year ago.

A survey conducted by Pharmapack Europe organizers ahead of the event found India as the biggest mover in drug delivery and device innovation with a 6.62 score in a 10-point scale gaining nearly 13% on its score from 2020 after the U.S., Germany and Japan.

To promote the domestic manufacturing of medical devices, India is now offering many schemes and incentives under its ambitious ‘Make in India’ initiative. As part of it, the government is establishing medical device parks—a manufacturing ecosystem to create world-class testing and infrastructure facilities—at various localities.