Drugs and Cosmetics Act: The Central Legislative Assembly passed the Drugs and Cosmetics Act 1940 and rules 1945 to regulate the import, manufacture and distribution, and sale of drugs and cosmetics. Drugs and Cosmetics Act is applicable on Allopathic, Homeopathic, Unani and Siddha drugs as well on contraceptives, mosquitoes repellents, creams, lotions, cosmetics, and devices used for internal and external use for diagnosis. Under the drugs and cosmetics act, the regulation of manufacture, sale, and distribution of Drugs is primarily the concern of the State authorities while the Central authorities are responsible for approval of New Drugs, Clinical trials in the country, laying down standards for Drugs, control over the quality of imported drugs, co-ordination of the activities of Drug Control Organization and providing expert advice with a view of bringing about uniformity in the enforcement of Drug and Cosmetic Act.
Objectives of Drugs and Cosmetics Act
Table of Contents
- The Drugs and Cosmetics Act 1940 provides the Central legislation, which regulates the import, manufacture, distribution, and sale of drugs and cosmetics in the country.
- The main objective of the Drugs and Cosmetics Act is to ensure that the drugs available to the people are safe and efficacious and the cosmetics market is safe for use.
- The Drugs and Cosmetics Act regulates the manufacture and import of drugs into India so that no substandard or spurious drugs get manufactured and imported in and into India respectively.
- Drugs and Cosmetics Act provides the regulation of the sale and distribution of drugs and cosmetics whereby only qualified and trained persons can undertake their handling, compounding, and distribution.
- Drugs and Cosmetics Act also provides the constitution of two boards namely, the Drug Technical Advisory Board (DTAB) and Ayurvedic and Unani Drugs Technical Advisory Board to advise the Central and State governments on technical matters arising out of the administration of this act.
- Drugs and Cosmetics Act also provides the establishment of two Drugs Consultative Committees (DCC), one for allopathic and the other for Ayurvedic, Siddha, Unani drugs to advise the various Governments and Boards on matters tending to secure uniformity throughout the country in the administration of the act.
Definitions of Drugs and Cosmetics Act
- All medicines for internal or external use of human beings or animals and all substances intended to be used for or in the diagnosis, treatment, mitigation, or prevention of any disease or disorder in human beings or animals, including preparations applied on the human body to repel insects like mosquitoes.
- Such substances (other than food) intend to affect the structure or any function of the human body or are intended to be used for the destruction of vermin or insects which cause disease in human beings or animals.
- All substances intended for use as components of a drug including empty gelatin capsules; and
- Such devices are intended for internal or external use in the diagnosis, treatment, mitigation, or prevention of disease or disorder in human beings or animals.
Ayurvedic, Siddha, or Unani Drug:
It includes all medicines intended for internal or external use of human beings or animals for diagnosis, treatment, mitigation, or prevention of disease or disorder by the formulae described in the authoritative books of Ayurvedic, Siddha, and Unani Tibb system of medicine, specified in the first schedule.
A drug shall be deemed to be misbranded:
- If it is so colored, coated, powdered, or polished that damage is concealed or if it is made to appear of better or greater therapeutic value than it is; or
- If it is not labeled in a prescribed manner; or
- If its label or container or anything accompanying the drug bears any statement, design, or device which makes any false claim for the drug or which is false or misleading in any particular.
A drug shall be deemed to be adulterated:
- If it consists, in whole or in part, of any filthy, putrid or decomposed substance; or
- If it has been prepared, packed, or stored under insanitary conditions whereby it may have been contaminated with filthy or whereby it may have been rendered injurious to health; or
- If its container is composed in whole or in part, of any poisonous or deleterious substance which may render the contents injurious to health; or
- If it bears or contains, for purposes of coloring only, a color other than one which is prescribed.
- If it contains any harmful or toxic substance which may render it injurious to health; or
- If any substance has been mixed therewith to reduce its quality or strength.
A drug shall be deemed to be spurious:
- If it is manufactured under a name that belongs to another drug; or
- If it is an imitation of, or is a substitute for, another drug or resembles another drug in a manner likely to deceive or bears upon it or upon its label or container the name of another drug unless it is plainly or conspicuously marked to reveal its true character and its lack of identity with such other drug; or
- If the label or container bears the name of an individual or company purporting to be the manufacturer of the drug, which individual or company is fictitious or does not exist; or
- If it has been substituted wholly or in part by another drug or substance., or
- If it purports to be the product of a manufacturer of whom it is not truly a product.
A Drug Inspector appointed by the Central Government or a State Government who is an expert and qualified to monitor the safety, utility, efficacy, and quality of a drug from its manufacturing till its sale at the retail shop.
Any article intended to be rubbed, poured, sprinkled or sprayed on, or introduced into, or otherwise applied to, the human body or any part thereof for cleansing, beautifying, promoting attractiveness, or altering the appearance, and includes any article intended for use as a component of cosmetic.
A cosmetic shall be deemed to be misbranded:
- If it contains a color that is not prescribed; or
- If it is not labeled in a prescribed manner; or
- If the label or container or anything accompanying the cosmetic bears any statement which is false or misleading in any particular.
A cosmetic shall be deemed to be spurious:
- If it is imported under a name that belongs to another cosmetic; or
- If it is an imitation of, or is a substitute for, another cosmetic or resembles another cosmetic in a manner likely to deceive or bears upon it or upon its label or container the name of another cosmetic, unless it is plainly and conspicuously marked to reveal its true character and its lack of identity with such other cosmetic; or
- If the label or container bears the name of an individual or a company purporting to be the manufacturer of the cosmetic which individual or company is fictitious or does not exist.
- If it is an imitation of, or is a substitute for, another drug or re-not truly a product.
Licensed premises for the sale of drugs, a retail store that does not require the services of a qualified person and sells both prescription and non-prescription drugs.
Licensed premises for the sale of drugs, which require the services of a qualified person but where the drugs are not compounded against prescriptions.
- He is a person holding a diploma or degree in Pharmacy or Pharmaceutical Chemistry.
- Is a registered pharmacist, (under Pharmacy Act, 1948).
- Has minimum 4 years experience of dispensing and has been approved by licensing authority as a ‘Qualified Person’ on or before 31st Dec 1969.
A Government Analyst appointed by the Central Government or a State Government who shall analyze or test or cause to be analyzed or tested such samples of drugs as may be sent to him by Inspectors or any other persons or authority authorized by the Central Government or a State Government and shall furnish reports of the results of test or analysis by these rules.
Further, shall from time to time forward to the Government reports giving the results of analytical work and research with a view to their publication at the discretion of the Government.
In relation to any drug or cosmetic includes any process or part of a process for making, altering, ornamenting, finishing, packing, labeling, breaking up, or otherwise treating or adopting any drug or cosmetic with a view to its sale or distribution but does not include the compounding or dispensing of any drug, or the packing of any drug or cosmetic, in the ordinary course of retail business.
Import: Means to bring into India.
Patent or Proprietary Medicine:
In relation to Ayurvedic, Siddha, or Unani Tibb systems of medicine all formulations containing only such ingredients mentioned in the formulae described in the authoritative books of Ayurveda, Siddha, or Unani Tibb systems of medicine specified in the First Schedule, but does not include a medicine which is administered by the parenteral route and also a formulation included in the authoritative books.
In relation to any other systems of medicine, a drug for internal or external administration of human beings or animals and which is not included in the edition of the Indian Pharmacopoeia or any other Pharmacopoeia or official books.
It includes any drug and whose therapeutic efficacy has been established through long clinical experience as recorded in authoritative Homeopathic literature, prepared according to the techniques of Homeopathic pharmacy. It does not include medicines, administered by the parenteral route.
Schedules to the Act and Rules
Schedules to the Act:
First Schedule: Names of books under Ayurvedic and Siddha systems.
Second Schedule: Standard to be compiled with imported drugs and by drugs manufactured for sale, stocked, or exhibited for sale or distributed.
Schedules to the Rules:
Import of Drugs
Prohibition of Import of Certain Drugs or Cosmetics:
Following Drugs and cosmetics cannot be imported:
- Any drug or cosmetic which is not of standard quality;
- Any misbranded or spurious or adulterated drug or cosmetics;
- Any drug or cosmetic without an import license, for the import, for which an import license is prescribed.
- Any patent or proprietary medicine, which has not displayed the true formula or list of active ingredients with their quantities as per the label.
- Any drug which claims to cure or prevent any disease or ailments specified in Schedule J.
- Any cosmetic or drug-containing ingredient, which is unsafe or harmful.
- Any drug or cosmetic whose manufacture, sale, distribution, and import of which is prohibited by rule made under this act, except for examination, test, or analysis.
- Drugs not labeled in the prescribed manner.
- Drugs after the expiry, and those which do not meet the standards, quality, and purity specified in the schedule-F.
Import of Drugs under License:
The following classes of drugs can be imported under the license or permit granted by the licensing authority:
1. Drugs specified in schedules C and C1 excluding those specified in Schedule X.
2. Drugs specified in schedule X.
3. Minor quantities of drugs imported for the examination, test, or analysis.
4. Drugs for personal use are covered by a prescription of RMP.
5. Any new drug.
6. An application for an import License shall be made to the licensing authority by the manufacturer or by the manufacturer’s agent in India and shall be accompanied by a License fee of ` 1,000 for a single drug and ` 1,000 for each additional drug, duly signed by or on behalf of the manufacturer.
7. Any application for import license in Form 8 or 8-A, shall be accompanied by a copy of the Registration Certificate issued in Form 41; in the case of emergencies, the issue of Import License by the central government in Form 10 or 10-A without the issuance of Registration Certificate under Rule 27-A, for reasons to be recorded in writing.
8. The License remains valid up to 31st Dec of the year following the year in which its granted unless canceled or suspended earlier.
9. The importer should have proper storage facilities for preserving imported drugs and properties.
10. A fee of ` 250 shall be paid for a duplicate copy of the license if the original is defaced, damaged, or lost.
‘Registration certificate’ means, a certificate issued under Rule 27-A, by the licensing authority in Form-41, for the registration of premises and drugs manufactured by the manufacturer for import into and use in India.
- A fee of ` 1,000 and the US $ 500 dollars shall be paid through a Challan along with the application in Form 40 as a registration fee for his premises meant for manufacturing of drugs intended for import and use in India.
- A fee of US $ 300 dollars shall be paid for a duplicate copy of the Registration Certificate if the original is defaced, damaged.
Suspension and Cancellation:
Both the Import License and Registration Certificate will be suspended or canceled if the manufacturer or licensee fails to comply with any of the conditions. The licensing authority may after giving the manufacturer or licensee, an opportunity to show cause why such an order should not be passed, by an order in writing the reasons and further take measures for the same. The reasons for the cancellation may be:
- The drugs in schedule C and C1 are prohibited for import into the country after the expiry of the potency of the drug product.
- If the drug is banned in the country of origin then it is prohibited from importing into the country except for examination, test, or analysis.
Conditions of Import License:
An Import License is subject to the following conditions:
- The licensee must observe at all the times the undertaking given by him or on his behalf in Form 9:
- The licensee must allow any authorized Inspector to:
- Enter the licensed premises where imported drugs are stored.
- Inspect the substances employed for testing.
- Take samples.
- The licensee must furnish the adequate quantity of samples from the required batches to the licensing authority for examination along with complete protocols of the test applied.
- If licensing authority so directs, until receipt of Certificate of Authorization, the licensee must not sell any batch products to which samples are submitted to the licensing authority.
- The licensee must maintain the record of all sales of imported substances as prescribed under the rules and should furnish the same during the inspection.
- The licensee must maintain separate records for the sale or distribution of Schedule-X drugs.
- Licensee must also comply with such further requirements, prescribed by the authority and of which he has been given not less than four months of notice.
Import of New Drugs:
- A written permission of the licensing authority is required for the import of new drugs.
- For obtaining permission, all documentary and other evidence related to the standards of quality, purity, and strength, etc. should be supplied to the licensing authority.
- An application for an import License for small quantities of a new drug, as defined in rule 122-E for treatment of the patient.
- Every application in Form 12-AA shall be accompanied by a fee of one hundred rupees for a single drug and an additional fee of fifty rupees for each additional drug.
- The fees shall be paid through a challan in the Bank of Baroda.
- A License for the import of small quantities of a new drug, defined in rule 122-E, for the purpose may be canceled by the licensing authority for the conditions subject to which the License was issued. If so, the licensee may appeal to the Central Government within three months of the date of the order of cancellation.
Import of Drugs for Examination, Test, or Analysis:
- The drug is imported under a license in Form-11.
- The drug must be exclusively examined in the place specified in the license by the licensing authority.
- An authorized inspector must be allowed to investigate how imported substances are used; thereof allowed to take the samples.
- The record of the imported substances along with their quantities, the date of importation, and the name of the manufacturer should be maintained and reported to the authority.
- The licensee must comply with any further requirements as may be specified by the authority, and of which the licensing authority has given, to him not less than notice of a month.
- In case if the license is canceled, the licensee may appeal to the Central Government within three months of the date of the order of cancellation.
Import of Drugs or Cosmetics for Personal use:
Import of drugs that are otherwise prohibited under section 10 of the act can be imported on following conditions:
- Drugs or cosmetics must be a part of a passenger’s bonafide baggage and must be intended for the exclusive personal use of the passenger.
- They must be declared to the customs collector, if so directed.
- The quantity of any single drug so imported must not exceed hundred average doses.
- Any drug or cosmetic not forming the part of passenger’s baggage, may be allowed to import to an application made to the licensing authority in form 12-A.
- If the licensing authority is satisfied, a permit is granted in Form 12-B.
*Note: Places through which Drugs may be imported into India:
- Ferozpur Cantonment and Amritsar Railway Stations: by rail (across the frontier with Pakistan).
- Ranaghat, Bangaon, and Mohiassan Railway Stations: by rail (across the frontier with Bangladesh).
- Chennai, Calcutta, Mumbai, and Cochin: by sea
- Chennai, Calcutta, Mumbai, Delhi, and Ahmedabad: by air
Offenses and Penalties Relating to the Import of Drugs:
Manufacture of Drugs
Prohibition of Manufacture and Sale of Certain Drugs:
The following drugs are prohibited to manufacture for sale under section 18 of the act:
- Any drug or cosmetic which is not of standard quality or is misbranded, adulterated, or spurious;
- Any patent or proprietary medicine, whose formula with the quantities, is not disclosed on the label or container;
- Any drug which purports or claims to prevent, cure or mitigate any such disease specified in schedule J;
- Any cosmetic containing any ingredient which may render it unsafe or harmful for use;
- Any drug or cosmetic in contravention of this act or rules made thereunder;
Conditions for Grant of License:
The license is granted, if the applicant complies with the following conditions:
- The manufacture must be conducted under active direction and personal supervision of competent technical staff (approved manufacturing chemist), as per the rules.
- The licensee and factory premises should comply with the conditions and requirements prescribed under Schedule M respectively.
- The applicant must provide for various operations, adequate space, plant, and equipment, as per Schedule M.
- The applicant must provide a separate testing unit or quality control section with an, independent head, with adequate facilities, for the test and standardization of drugs and raw materials.
- The applicant should make adequate arrangements for the storage of drugs, manufactured.
- For patent and proprietary medicines, the applicant must furnish the documents and data related to claims, safety, stability, therapeutic justifications, etc., as per the rules.
After completion of the inspection, Drug Inspector forwards a detailed report and his recommendations to the Central Licensing Authority.
- On receipt of application in the prescribed form along with fees for grant or renewal of license by the applicant, the authority verifies the statement, post-performance of the licensee, and the above requirements. Thereafter, the Licensing authority on necessary inquiries and satisfaction grants the license to the applicant in the prescribed form.
- If Licensing authority thinks that the applicant is incapable to fulfill the requirements, it may refuse to grant or renew the license.
Types of Licenses for Manufacture of Drugs
Conditions of License for Manufacture of Drugs
Manufacture of Schedule C, C1, and X Drugs:
Following are the general conditions of license of schedule C, C1, and X drugs in Form 28-B and 28-D; other than schedule C and C1 drugs in Form 25; Schedule X drugsForm 25-F.
Manufacture of Drugs for Test, Examination, and Analysis:
A license is required to manufacture any drug in small quantity for examination, test, or analysis purposes.
- If a person proposing to manufacture does not hold a license to manufacture drugs specified in Schedule C and C1 or other than Schedule C, C1, and X, shall obtain a license Form 29 before manufacturing such drugs.
- The licensee shall carry the manufacture and examination of drugs at the place specified in the license.
- In the case of drugs that are unsafe for use, a license in Form 29 can be granted only on producing NOC (no objection certificate) from the licensing authority.
- Application must be countersigned by the Head of the Institution, which proposes to undertake the manufacture.
- License remains valid for 1 year unless canceled or suspended.
- Any drug for examination, shall be placed in the containers, labeled to manufacture it, name and address of the manufacturer. Thereafter supplied to any other manufacturer, when necessary.
- The licensee shall allow Inspector to inspect the premises and satisfy himself that only examination is conducted.
- The licensee shall keep a record of the number of drugs supplied for analysis also maintain the ‘Inspection Book’.
- The licensee shall comply with such requirements specified and of which the authority has given him not less than 1 month’s notice.
Manufacture of New Drugs:
- As per Rule 122 E of the Drug and Cosmetics Rules 1945, a New Drug can be 1. A new substance of chemical, biological or biotechnological origin; in bulk or prepared dosage form; used for prevention, diagnosis, or treatment of disease in man or animal, which except during local clinical trials has not been used in the country; and which, except during local clinical trials, has not been recognized in the country as effective and safe.
- A drug already approved by the licensing authority for the proposed claims, which is now proposed to be marketed with modified or new claims; or A fixed-dose combination of two or more drugs individually approved earlier for certain claims, which are now proposed to be combined for the first time in a fixed ratio; or If the ratio of ingredients in an already marketed combination is proposed to be changed, with certain claims, like:
- Dosage form (including sustained release dosage form).
- Route of Administration.
- All vaccines shall be new drugs unless certified otherwise by the Licensing Authority.
- A new drug shall continue to be considered a new drug for four years from the date of its first approval or its inclusion in the Indian Pharmacopoeia, whichever is earlier.
Conditions of License:
- No ‘new drug’ can be manufactured, before approval from the licensing authority.
- The applicant, shall submit data as given in Appendix-1 to Schedule Y, including the results of clinical trials as per the format of Appendix-2 to Schedule Y.
- While applying for the license, the applicant shall furnish the evidence certificate that the drug has already been approved.
Note: What is a Subsequent New Drug Application?
A Subsequent New Drug application is an application for approval of an already approved new drug by the Central Drugs Standard Control Organization (CDSCO). It can be made for the following cases:
- Bulk Drug already approved in the country (approved within 4 years).
- New drug (Formulation) already approved in the country.
- A drug already approved and proposed to be marketed with a new indication.
- A drug already approved and proposed to be marketed as a ‘New Dosage Form / New Route of Administration.
- A drug already approved and proposed to be marketed as a ‘Modified release dosage form’.
- A drug already approved and proposed to be marketed with Additional Strength.
All the applications for approval of New Drug, Fixed-Dose Combination, and Subsequent New Drug are made under Form 44 (Application for grant of permission to import or manufacture a New Drug or to undertake clinical trial).
It is issued by the licensing authority, to a person who does not own, arrangements for the manufacture but intends to avail the manufacturing facilities owned by another licensee.
1. In the case of pharmacy business is operating its business in more than two states then it is required to obtain a drug license in each state where the business is carried on. A separate license shall be issued in case drugs are sold in more than one place.
2. After the license is granted to the business, the licensee must ensure that all the conditions of the drug license must be complied with during business. In the case of any changes or modifications in business activity authority must be informed and all the registers, records, and forms must be maintained in a specified manner.
3. The licensing authority shall, before the grant of a loan license, satisfy himself that the manufacturing unit has adequate equipment, staff, capacity for manufacture, and facilities for testing, to undertake the manufacture on behalf of the applicant for a loan license.
4. Application for the manufacture of more than ten items for each category of the drug on a loan license shall be accompanied by an additional fee of rupees three hundred per additional item specified in Schedule M and Schedule M3.
5. The licensee shall allow Inspector to inspect the premises and satisfy himself that only examination is conducted.
6. The licensee shall maintain the ‘Inspection Book’ in Form 35.
7. The licensee shall comply with further requirements specified by the authority.
8. The licensee shall test each batch of raw materials used and each batch of the final product and also maintain the records of manufacture and testing of each batch as per schedule U.
9. Shall maintain the reference samples from each batch for 3 years.
10. Report to the licensing authority, regarding the changes in expert staff or change in the manufacture or testing units.
11. For Schedule C and C1 drugs, the licensee shall furnish the data of stability and date of expiry to the licensing authority.
12. If the licensing authority is satisfied that a loan license is defaced damaged or lost or otherwise rendered useless, he may, on payment of a fee of rupees one thousand, issue a duplicate license.
It is granted to break up any drug than those specified in Schedule C and C1.
- Repacking of drugs should be conducted under hygienic conditions under the personal supervision of a competent person, approved by the licensing authority.
- The licensee must provide and maintain adequate arrangements for carrying out tests of drugs repacked, in the specified place by the authority.
- The licensee shall allow Inspector to inspect the premises and to take samples of repacked drugs.
- The licensee shall test each batch of raw materials used and each batch of the final product and also maintain the records of manufacture and testing of each batch as per schedule U. Records must be retained for 5 years from the date of repacking.
- Licensee must allow the Inspector to inspect all the registers and records maintained.
- The licensee shall maintain the ‘Inspection Book’ in Form 35.
- Shall maintain the reference samples from each batch of repacked drugs, for the specified period.
- Licences remain valid for 5 years from the date its granted or renewed, unless suspended or canceled.
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