INTRODUCTION
The Healthcare industry in India comprises of hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance, and medical equipment. The industry is growing at a tremendous pace owing to its strengthening coverage, services and increasing expenditure by public as well as private players.
The Ministry of Health and Family Welfare (MoHFW) is committed to rapidly immunization coverage and consolidate the health systems strengthening efforts keeping in mind the socio-cultural practices and beliefs in child immunization among tribal communities in India. Universal Immunization Programme (UIP) is one of the largest cost-effective public health interventions targeting close of 26.7 Mn newborns and 29 Mn pregnant women annually for reduction of vaccine preventable under-5 mortality rate, by providing free of cost against 12 vaccine preventable diseases.
Growing incidence of lifestyle diseases, rising demand for affordable healthcare delivery systems due to the increasing healthcare costs, technological advancements, the emergence of telemedicine, rapid health insurance penetration and government initiatives like e-health together with tax benefits and incentives are driving the healthcare market in India.
- The hospital sector in India was valued at ₹ 7940.87 Bn in FY21 in terms of revenue & is expected to reach ₹ 18,348.78 Bn by FY 2027, growing at a CAGR of 18.24%.
- The Telemedicine market is the maximum potential eHealth segment in India, which is expected to touch $5.4 Bn by 2025, growing at a compound annual growth rate (CAGR) of 31%
- Over the next 10 years, National Digital Health Blueprint can unlock the incremental economic value of over $200 Bn for the healthcare industry in India.
- India has the world's largest Health Insurance Scheme (Ayushman Bharat) supported by the government.
India's healthcare sector is divided as follows:
Hospitals: Comprising of Government Hospitals (includes healthcare centres, district hospitals and general hospitals) and Private Hospitals (includes nursing homes, mid-tier and top-tier private hospitals).
Pharmaceuticals: It includes manufacturing, extraction, processing, purification, and packaging of chemical materials for use as medications for humans or animals.
Diagnostics: It comprises businesses and laboratories that offer analytical or diagnostic services, including body fluid analysis.
Medical Equipment and Supplies: It includes establishments primarily manufacturing medical equipment and supplies, e.g. surgical, dental, orthopedic, ophthalmological, laboratory instruments, etc.
LEGAL UPDATES
1. REGULATIONS FOR MEDICAL RESEARCH AND GOVERNANCE IN HOMEOPATHY
The National Commission for Homeopathy (Medical Research in Homeopathy) Regulations, 2023 ("MRH Regulations") came into effect on 01 December 2023. The MRH Regulations aim to set standards for medical research in homeopathy in India, including setting up of a research regulation committee to monitor research progress. The MRH Regulations set the standards for research on pre-clinical and clinical trials and regulates advance research of homeopathy on scientific lines in an interdisciplinary and integrative manner.
Further, the National Commission for Homeopathy (General) Regulations, 2023 ("NCH Regulations"), have also come into effect on 04 December 2023. The NCH Regulations aim to regulate the governance and collaboration of various stakeholders within the field of homeopathy such as mandatory joint sitting (at least once a year) of the National Commission for Homeopathy, the National Commission for Indian System of Medicine, and the National Medical Commission. Further, autonomous boards like the Board of Ethics and Registration for Homeopathy, Homeopathy Education Board, and the Medical Assessment Rating Board for Homeopathy are required to meet at least once a month to fulfil their assigned functions under the National Commission for Homoeopathy Act, 2020 and the NCH Regulations. The NCH Regulations also empower the National Commission of Homeopathy to engage experts and professionals to strengthen the governance, collaboration, and overall standards within the field of homeopathy.
2. DRUG CONTROLLER GENERAL OF INDIA LAYS DOWN NEW RULES FOR COMPOUNDING OF OFFENCES
The Jan Vishwas (Amendment of Provisions) Act, 20235 which was passed earlier this year, and is yet to be notified, provided for certain offences under the Drugs and Cosmetics Act, 1940 ("Drugs Act") to be compoundable offences. Accordingly, offences relating to contravention of the provisions of the Drugs Act for manufacturing of drugs, excluding adulterated or spurious drugs, will be compounded by the central government or the state government. In view of the above, the DCGI has made recommendations to frame rules for compounding of offences under the Drugs Act and the central government is expected to soon come out with the draft rules for the same.
3. PARALLEL APPROVAL OF DRUGS IN SYNC WITH GLOBAL MARKETS TO EXPEDITE THE LAUNCH OF NEW MEDICINES IN INDIA.
The Organisation of Pharmaceuticals Producers of India ("OPPI") representing multinational pharma giants like Novartis, Roche, Sanofi, AstraZeneca and Merck, has requested the Drug Controller General of India ("DCGI") to enable drug approvals in India in parallel with approvals being granted in the global market. This request is made due to the inadvertent delay of getting drug approvals in India as compared to the United Kingdom, United States, and the European Union.
The main challenge which causes this delay are complex clinical trials. OPPI envisions a transformative approach to drug approval processes, advocating for regulations that enable parallel filing of marketing approval applications in sync with major global markets. OPPI further focused on the importance of a predictable regulatory pathway with minimal ambiguity and enabling early access of innovative therapies to patients in India. According to the OPPI, the timelines can be easily reduced to less than 2 years if India participates in global trials for early access to innovation and for bringing innovative therapies to Indian patients. This can be further shortened if the overall review timeline is reduced to 12 months, or the review is done parallel to the global market.
4. GOOD MANUFACTURING PRACTICES (GMP) REVISED UNDER THE PHARMA MANUFACTURING RULES
On 05 January 2024, the Ministry of Health and Family Welfare ("Health Ministry") notified an amendment ("GMP Amendment") to Schedule M of the Drugs and Cosmetics Rules, 1945 ("Drug Rules"). Schedule M of the Drug Rules prescribes good manufacturing practices for pharmaceutical products. The GMP Amendment has broadened the scope of 'Good Manufacturing Practices' to 'Good Manufacturing Practices and Requirements of Premises, Plant and Equipment for Pharmaceutical Products', thereby extending the compliances and quality standard requirements to premises, plants, and equipment.
The GMP Amendment extends the scope of its application to contract manufacturers as well. Every contract manufacturer is required to adhere to the compliances stipulated under the GMP Amendment, and the contract givers are required to evaluate the same. Sub-contracting and changes in the process, equipment, test methods, specifications are required to be undertaken with the approval of the contract giver. Other changes include introduction of pharmaceutical quality systems (PQS), quality risk management (QRM), product quality review (PQR), qualification and validation of equipment, and a computerised storage system for all drug products.
The GMP Amendment prescribes the following timelines for complying with the requirements: (a) large manufacturers (having a turnover in excess of ₹ 250 Crores) have been given a period of 6 months from the date of publication of the GMP Amendment (i.e., January 5, 2024); and (b) small and medium manufacturers (having a turnover of up to ₹ 250 Crores) have been given a 12-month window.
5. ALLAHABAD HIGH COURT DECLARES MEDICAL REPRESENTATIVES AS DEEMED 'WORKMEN' WITHIN THE MEANING OF THE INDUSTRIAL DISPUTES ACT, 1947
The Allahabad High Court delved into the classification of medical representatives as 'workmen' under the Industrial Disputes Act, 1947 ("ID Act") and ascertained that after coming into force of Sales Promotion Employees (Conditions of Service) Act, 1976, medical representatives would be deemed to be workmen as per the provisions of ID Act. In the instant case, a workman, who was initially appointed as a clerk in Nicholas Piramal India Limited was subsequently appointed as a medical representative.
The workman was alleged to be involved reason and justification while prescribing antibiotics. The pharmacists have also been directed to implement Schedule H and H1 of the Drugs Rules and sell antibiotics only on valid prescriptions.
6. NEW GUIDELINES ISSUED FOR INTENSIVE CARE UNIT ADMISSION AND DISCHARGE CRITERIA
The Health Ministry has introduced guidelines for regulating the admission and discharge criteria for intensive care units ("ICU Guidelines") for hospitals to decide the need of admitting a patient for treatment under the intensive care unit ("ICU"). The ICU Guidelines have been compiled by a panel of 24 doctors with expertise in critical care medicine. Altered level of consciousness of recent onset, hemodynamic instability, need for respiratory support, patients with acute illnesses requiring intensive monitoring and/or organ support or any medical condition or disease with anticipation of deterioration have been listed as criteria for ICU admission. Patients who have experienced any major intraoperative complication like cardiovascular or respiratory instability or have undergone major surgery also feature among the criteria.
According to the ICU Guidelines, blood pressure, pulse rate, respiratory rate, breathing pattern, heart rate, oxygen saturation, urine output and neurological status among other parameters should be monitored in a patient awaiting an ICU bed. The ICU Guidelines also include discharge criteria such as return of physiological aberrations to near-normal or baseline status, reasonable resolution and stability of the acute illness that necessitated ICU admission, patient/family agreeing for ICU discharge for a treatment-limiting decision, or palliative care.
7. INDIA'S FOOD SAFETY REGULATOR WORKING ON STRICTER RULES FOR HEALTH SUPPLMENTS
The Food Safety and Standards Authority of India ("FSSAI") is working on framing regulations for nutraceuticals and health products (including supplements) more stringent, since the FSSAI has conducted surveys, wherein many unregulated, expired and non-compliant products has been discovered and ceased.
The authority received several complaints in relation to non-compliant health supplements being sold in the market, pursuant to which FSSAI conducted a drive across the nation to in order to investigation nutraceuticals and health supplements for quality and safety throughout their manufacturing and sale process.
In September 2023, nutraceutical accounted for 31% of all billing at chemists, according to a survey of nearly 13,000 bills across 15 cities by research firm Pronto Consult. It said this indicated massive growth of 24% year-on-year in the segment.
8. NEW MARKETING CODE FOR PHARMACEUTICAL COMPANIES NOTIFIED; PHARMACEUTICAL ASSOCIATIONS TO SET UP DEDICATED PORTAL FOR HANDLING COMPLAINTS OF VIOLATIONS
The Department of Pharmaceuticals on 12 March 2024 has notified Uniform Code for Pharmaceutical Marketing Practices (UCPMP) 2024. In order to ensure strict compliance with UCPMP, all pharmaceutical associations are required to establish an Ethics Committee for Pharmaceutical Marketing Practices (ECPMP) and set up a dedicated UCPMP portal on their websites. Unlike the previous iteration of the code, the 2024 iteration has explicitly permitted pharma and medical device companies to provide brand reminders up to ₹1000 per item, and has also allowed another informational and educational items to be included in the category of brand reminders.
9. NEW LAW FOR REGULATION OF PRICES OF DRUGS AND MEDICAL DEVICES WILL COME INTO PLAY SOON
Indian Department of Pharmaceuticals has constituted a committee which has been tasked with a role to draft a new Drugs and Medical Devices (Control) order. The committee will also examine pricing regulation for drugs and medical devices with focus on balancing price availability for essential medicines and price moderation for medical devices without hindering growth of the industry.
The committee will consist three core members, which are as follows:
- Secretary, Department of Pharmaceuticals.
- Chairman, national Pharmaceutical pricing Authority.
- Senior Economic Adviser, Department of Pharmaceuticals.
10. IMPORT OF MEDICINES TO GET BOOST FROM INDIA'S FREE-TRADE AGREEMENT WITH FOUR COUNTRIES OF EUROPEAN FREE TRADE ASSOCATION
Four European Free Trade Association states, namely, Iceland, Liechtenstein, Norway and Switzerland, have signed a Trade and Economic Partnership Agreement with India for facilitating trade and investment flows. While India has secured soft investment commitments under the Agreement, EFTA states have been given concession on import duty on pharmaceutical products exported to India and have promised simplified customs procedure.
The countries acknowledges the relevance of the WTO Agreement on Subsidies and Countervailing Duties and agree to implement additional notification and consultation procedures. They also discuss the application of anti-dumping measures, allowing a Party to exempt originating products from global safeguard measures if they do not pose a serious threat of injury, consistent with WTO regulations. Additionally, the Agreement allows for bilateral safeguard measures if a Party encounters potential economic harm due to increased imports resulting from trade liberalization under the Agreement.
BRIEF ABOUT KEY LAWS AND REGULATIONS
1. The Clinical Establishments (Registration & Regulation) Act, 2010 ("Clinical Establishments Act")
The Clinical Establishments Act, inter alia, regulates all clinical establishments in India, and prescribes certain minimum standards for facilities and services provided by such clinical establishments. In terms of the Clinical Establishments Act, a 'clinical establishment' means, among other things, a hospital, maternity home, nursing home, dispensary, clinic, sanatorium or an institution by whatever name called that offers services requiring diagnosis, treatment or care for illness, injury, deformity, abnormality or pregnancy in any recognized system of medicine established and administered or maintained by any person or body of persons, whether incorporated or not. The Clinical Establishments Act mandates the registration of a clinical establishment. Every clinical establishment shall obtain a certificate of provisional registration and thereafter, upon fulfilment of prescribed standards, a certificate of permanent registration from the district registering authority. Further, the council established at the national and state levels under the Clinical Establishments Act is, inter alia, required to maintain registers and periodically review the minimum standards to be followed by the clinical establishments.
2. The Clinical Establishments (Central Government) Rules 2012 ("CECG Rules") and allied state legislations
The CECG Rules, inter alia, provide conditions for registration and continuation of clinical establishments. In terms of the CECG Rules, clinical establishments are required to charge rates for each type of procedures and services within the range of rates determined by the Central Government in consultation with the state governments and display such rates for the benefit of the patients at a conspicuous place in a local language as well as in English. Clinical establishments are required to maintain electronic records of patients and statistics, in accordance with the CECG Rules.
The Ministry of Health and Family Welfare vide its notification dated 18 May 2018 amended the CECG Rules and introduced minimum standards for medical diagnostic laboratories (or pathological laboratories). It stipulates that each clinical establishment undertaking diagnosis or treatment of diseases, pathological, bacteriological, genetic, radiological, chemical, biological investigations or other diagnostic or investigative services are carried on with the aid of laboratory or other medical equipment, to comply with the minimum standards of facilities and services.
Certain States in India have framed rules under the CERC Act or under respective state legislation for clinical establishment, prescribing inter alia the powers of registration authority, procedure for registration of clinical establishments and applicable fee. In addition to the legislations summarized above, our facilities are also required to comply with the certain state specific rules prescribed under the Clinical Establishments Act, such as, the Haryana Clinical Establishments (Registration and Regulation) Rules, 2018, the Uttar Pradesh Clinical Establishments (Registration and Regulation) Rules, 2016.
3. The Pre-Conception and Pre-Natal Diagnostic Techniques (Prohibition of Sex Selection) Act, 1994 ("PCNDT Act") and Pre-Natal Diagnostic Techniques (Regulation and Prevention of Misuse) Act, 1994 ("PNDT Act") and the rules framed thereunder
The PCNDT Act and PNDT Act prohibit sex selection, before or after conception, regulate the use of pre-natal diagnostic techniques by restricting their usage for the purposes of detecting genetic or metabolic disorders or chromosomal abnormalities or certain congenital malformations or sex-linked disorders and seek to prevent the misuse of such techniques for the purposes of pre-natal sex determination leading to female foeticide. The PCNDT Act and PNDT Act mandate all genetic counselling centres, genetic clinics and genetic laboratories carrying out pre-natal diagnostic techniques, to register with the appropriate authority, failing which penal actions may be taken against them. Hospitals providing pre-natal diagnostic facilities fall within the purview of the PNDT Act. Further, the PCNDT Act and the PNDT Act prohibit advertisements relating to pre-conception and pre-natal determination of sex and any violation is punishable with fine and imprisonment.
The PCPNDT Rules prescribe qualifications of employees, required equipment and places for a genetic counselling centre, laboratory and clinic. The PCPNDT Rules stipulate the format in which an application for registration should be made by such centre, laboratory or clinic before the appropriate authority appointed under the PCPNDT Act and lays down the manner in which records are to be maintained and preserved by such genetic counselling centre, genetic laboratory or genetic clinic. The PCPNDT Rules provide for code of conduct and conditions to be followed by owners, employees or any other persons associated with a genetic counselling centre, genetic laboratory and genetic clinic registered under the PCPNDT Act. The PCPNDT Rules further require every genetic counselling centre, laboratory and clinic to intimate every change of employee, address and equipment installed, to the appropriate authority within the time prescribed and preserve such information as permanent records.
4. The Medical Termination of Pregnancy Act, 1971 ("MTP Act") and the Medical Termination of Pregnancy Rules, 2003
The MTP Act regulates the termination of pregnancies by registered medical practitioners by using medical or surgical methods and permits such termination of pregnancies only on specific grounds. It stipulates that medical terminations of pregnancies can be carried out only in certain stipulated circumstances by a registered medical practitioner who has the necessary qualification, training and experience in performing such terminations and only at a place equipped with facilities that meet the prescribed standards issued under the MTP Act and if such place is approved for the purpose. Further, in March 2021, the Medical Termination of Pregnancy (Amendment) Act, 2021 was introduced, which, inter alia, expands the scope of circumstances under which a registered medical practitioner can terminate pregnancies and imposes an obligation on the medical practitioners to protect the privacy of women undergoing the stipulated treatment. Under the Medical Termination of Pregnancy Rules, 2003 framed pursuant to the MTP Act, private clinics and hospitals can receive approval for such procedure only if the government is satisfied that termination of pregnancies will be done under safe and hygienic conditions, and such clinic or hospital has the requisite infrastructure and instruments in place.
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