Procedure for Applying for Drugs and Cosmetic License in India

(Laws in making, Type of Licenses, Forms, Penalties & Recent Developments)

Monika Taparia
Monika Taparia

Published on: Jan 1, 2022

Megha Jain
Megha Jain

Updated on: Nov 28, 2022

(19 Ratings)
7578

INTRODUCTION

The Drugs and Cosmetics Act is governed by Central Drugs Standard Control Organization (CDSCO) to regulate the import, manufacture, distribution and sale of drugs and cosmetics through licensing and to prevent substandard in drugs. Recently Many notifications issued under Section 26B of the D&C Act which empowers the CDSCO to control and regulate or restrict the manufacture of a drug in public interest.

LAWS IN MAKING

The Government is continuously working to bring new laws and amendments to monitor new retail avenues and regulatory demands that has emerged in recent years and to regulate medicines, cosmetics and medical devices in the pharmaceutical market. Drugs and Cosmetics (Draft Amendment) Rules, 2021 introduced on 23rd September 2021, amending the existing Rules by substitution of Rule 30AA with following key points

  • New Homoeopathic medicine not to be imported without obtaining a written permission by the Licensing Authority
  • While applying for permission the importer shall produce documentary evidence for assessing the safety, therapeutic efficacy of the medicine including the minimum homoeopathic proving carried at with it.

KEY DEFINITIONS

  • Drug includes
    • 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 human body for the purpose of repelling insects like mosquitoes
    • Such substances (other than food) intended to affect the structure or any function of the human body or intended to be used for the destruction of 10[vermin] or insects which cause disease in human beings or animals, as may be specified from time to time by the Central Government by notification in the Official Gazette
    • All substances intended for use as components of a drug including empty gelatin capsules
    • Such devices intended for internal or external use in the diagnosis, treatment, mitigation or prevention of disease or disorder in human beings or animals, as may be specified from time to time by the Central Government by notification in the Official Gazette, after consultation with the Board.
  • Cosmetic means 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.
  • Manufacture 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 8 [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 and “to manufacture” shall be construed accordingly.
  • Marketer a ‘marketer’ is any person who adopts a drug manufactured by another manufacturer for sale and distribution, by affixing or labelling their name on the drug.

Drug and Cosmetic License

Drug License: All manufacturers/retailers/traders that are directly or indirectly related in sale/purchase/manufacturing of medicines or involved in pharmacy business in India are required to obtain a drug license from the Drugs Controller General (India) or Central Drugs Standard Control Organization (CDSCO).Retail drug license is required to run a chemist shop and wholesale drug license is required for those who are engaged in the activities of wholesale of drugs and pharmaceutical products.

Cosmetic License: Every manufacturer of Cosmetics or importer of cosmetic have to obtain this license. The regulatory authority or body for Cosmetic Registration in India is the Central Drug Standard Control Organization (CDSCO).

CLASSIFICATION OR TYPES OF DRUGS LICENSE

Manufacturing Drug License

  • This license shall be obtained by the manufacturing units which manufacture drugs such as Allopathic, Ayurvedic, Cosmetics products or any other drugs
  • If a single manufacturer has two or more factories situated in different for manufacturing the same or different drugs a separate License shall be required in respect of the drugs manufactured by each such factory
  • There must be competent technical staff consisting at least of one person who is a whole-time employee and who is a graduate in Pharmacy or Pharmaceutical Chemistry and must have at least eighteen months practical experience of drugs manufacturing
  • Adequate space, plant and equipment for the manufacturing operations to be complied with Schedule M (Schedule M prescribes the good manufacturing practices (GMP)
  • There shall be separate arrangements for carrying out tests for the strength, quality and purity of the drugs at a testing unit and the repacking unit
  • Travelling agents of licensed manufacturers and importers of drugs involved in free distribution of samples of medicines among members of the medical profession, hospitals, dispensaries and the medical institution or research institutions are not required to obtain License.

Import Drug License

  • This license shall be obtained by the persons who are using or engaging in the distribution of imported drugs
  • The premises to be equipped with proper storage accommodation for preserving the properties of the drugs , where the imported substances will be stocked
  • Patent or proprietary medicines to be imported in containers intended for retail sale
  • All consignments of drugs to be imported to be accompanied with invoice or other statement containing the name and address of the manufacturer and the name and quantities of the drugs as well
  • The importer has to submit a declaration to the Drugs Controller before importing any kind of drugs which is not covered under mandatory licensing. The declaration should be signed by or on behalf of the manufacturer or importer.

Multi-Drug License

  • This license shall be obtained by the persons or entrepreneurs operating in more than one state
  • In case drugs are sold or stocked for sale at more than one place, separate License with respect to each such place is required by making separate applications.

Sale Drug License

  • This license shall be obtained by the wholesalers and retailers who are engaging for distribution of Drugs. There are three categories of drug license:
    • Wholesale drug license
    • Retail drug license
    • Restricted license for general store
  • Loan Drug License: This license shall be obtained by the persons who do not have their own land for manufacturing of drugs but want to manufacture the products and services with their brand name on land of others who are already issued with the License of manufacturing.

STEPS AND PROCEDURE OF REGISTRATION

  • As there are different types of Drug and Cosmetic license and the type of license required depends on goods, services, activities and the nature of business. The applicant has to make application online in the requisite Forms as per the category mentioned below with fees and required documents:
    • Form COS- 1: Application to obtain registration certificate for import of cosmetics
    • Form COS- 3: Permission to import or manufacture new cosmetics in India
    • Form COS-5: License to manufacture cosmetics for sale or for distribution
    • Form COS-6: Loan license to manufacture cosmetics for sale or for distribution
    • Form 8 & Form 8A: License to import drugs
    • Form 19 & 19A: License to sell, stock or exhibit or offer for sale, or distribute of drugs
    • Form 24: License to manufacture or distribution of drugs for sale purpose
    • Form 24A: Loan license for Drugs
  • Documentation for obtaining drug and cosmetic license is a crucial element in the whole process of licensing in India
  • The applicant has to apply separate applications for each type of prescribed license via different forms mentioned above
  • Scrutiny of application and Inspection of Factory premises takes place. The Drug Inspector visits the premises and verifies the particulars of application. A query is raised in case of any shortcoming / discrepancy
  • Products Scrutiny also takes place. The Drug Inspector verifies details of the products applied on online application and if they are found to comply with the norms, the application will be considered for grant of license. Inspector may raise any clarification in the application
  • After satisfactory verification, Drug Controller Department issues the License
  • The drug control administration also provides the approval for technical staff as per Drugs and Cosmetics Rules, 1945 framed under the legislation abiding by the WHO and GMP inspection norms.

DOCUMENTS REQUIRED FOR DRUG & COSMETIC LICENSE

The list of documents required for the Wholesale /Retail or sale drug and cosmetic License depends on the applicant’s type and business activity. Few important documents are as following:

  • Incorporation Certificate of the Company
  • KYC documents of each Director/Partner/ or Proprietor
  • Proof of premises such as rent agreement, electricity bill, property tax receipt etc
  • Site plan
  • KYC details of Technical Person
  • List of Cosmetics with Product sheets in specified proforma for approval of products along with their composition formula
  • Ownership details of the brand of cosmetic whether it is registered or under trademark, if any
  • Manufacturing Process description with flow diagrams. In-house specifications, where applicable; method of analysis of products. Copies of BIS where applicable
  • Below is the List of various Regulatory Authorities regulating the business of Drugs and Cosmetics:
# Regulatory Authority Types of License Authority Link
1 Department of Ayush
  • Ayurvedic Medicines
  • Siddha Medicines
  • Unani Medicines
  • Homeopathic Drugs
  • Herbal Products For Medicinal and cosmetic use
https://main.ayush.gov.in/
2 State Drug Controlling Authority with an approval by the Central License Approving Authority Central Drugs Standard Control Organization (CDSCO)
  • Cosmetic manufacturing license
  • Allopathic Drugs License
  • Veterinary Medicines license
  • New Drug Approval including investigational and subsequent new drug
  • Clinical trial (test License)
  • Import of medical devices, drugs and cosmetics
https://statedrugs.gov.in/SFDA/Homepage
https://cdsco.gov.in/opencms/opencms/en/Home/
3 Single window for multiple stakeholders involved in the processes of Central Drugs Standard Control Organization (CDSCO)
  • Permissions related to drugs, clinical trials, ethics committee, medical devices, vaccines and cosmetics
  • The system also builds up the database of approved drugs, manufacturers & formulations, retailers & wholesalers in India.
https://www.cdscoonline.gov.in/CDSCO/homepage
4 Food Safety and Standards Authority of India (FSSAI) Proprietary food like Herbal Powder and Churna where no Medicinal Use is claimed https://foscos.fssai.gov.in/
5 XLN INDIA for States of Chandigarh, Chattisgarh, Delhi, Goa, Himachal Pradesh, Jharkhand, Jammu-Kashmir, Kerela, Pudducherry and Uttaranchal
  • Retail (Medical Store) Drug License
  • Wholesale drug license
  • Allopathic drugs
  • Homeopathic Drugs
https://xlnindia.gov.in/login.aspx

LIST OF IMPORTANT RULES

  • Drugs and Cosmetics Rules, 1945 contains provisions relating to classification of drugs, guidelines for the storage, sale, display and prescription and contains procedures, forms, fees relating to import, manufacture, distribution and sale of drugs and cosmetics in India
  • Medical Devices Rules, 2017 contains the provision of medical device substances used for in vitro diagnosis and surgical dressings, surgical bandages, surgical staples, surgical sutures, ligatures, blood and blood component collection bag with or without anticoagulant and mechanical contraceptives, disinfectants and insecticides
  • New Drugs and Clinical Trials Rules, 2019: applies to all new drugs, investigational new drugs for human use, clinical trial, bioequivalence study, bioavailability study and Ethics Committee
  • Cosmetics Rules, 2020 carry out the provisions relating to Scrutiny of applications for registration and import of Cosmetic products and applications for NOC /Clarification with respect to import of cosmetic products
  • National Pharmaceutical Pricing Policy 2012 to put in place a regulatory framework for pricing of drugs so as to ensure availability of essential medicines at reasonable prices and provide sufficient opportunity to support the growth of industry
  • The Drugs (Prices Control) Order, 2013 imposes the provision on manufacturer to display on the label of container of the formulation and the minimum pack thereof offered for retail sale, the maximum retail price of that formulation based on the ceiling price with the words “Maximum Retail Price” preceding it and the words ‘inclusive of all taxes’ succeeding it.

LABELLING REQUIREMENTS ON IMPORTED COSMETIC

  • Registration certificate number of brand
  • Name and address of certificate holder
  • Name and address of the manufacturer
  • Name of the cosmetic
  • Date of manufacture/Expiry
  • List of ingredients
  • Adequate directions for use
  • Any warning, caution or special directions

RECENT DEVELOPMENT

The Health Ministry has passed an amendment on February 11, 2020 with following key highlights:

  • Earlier the D&C Rules has a provision that only the manufacturer of the drug is liable for any defects in the drug or for gaps in compliance in respect of such drug and not the marketing company of the drug
  • With effect from March 01, 2021, pharmaceutical companies have to ensure that contract manufacturers engaged by the pharmaceutical companies are also compliant with the D&C Rules.

Blood Bank Amendment with effect from March 11, 2020 came into force to tighten existing regulation for blood banks and streamline the blood donation process with following key highlights:

  • Blood banks are renamed as blood centers, revising the licensing procedure for blood centers, introduced new qualification requirements for technicians working at blood centers
  • Specifies Blood donation norms.

Cosmetic Rules, 2020, came into force with following key provisions:

  • The concept of new cosmetic was introduce and streamlines the process of import registration of cosmetics
  • Comply with the IS standards for testing the safety of the new cosmetic.

The AYUSH Ministry provides stringent regulatory guidelines to prevent misleading advertisements of Ayurveda, Siddha and Unani (ASU) medications:

  • The manufacturer of Ayurveda, Unani or Siddha cannot participate in the advertisement of any drugs which is used for diagnosis, cure, mitigation, treatment or prevention of any disease, disorder, syndrome or condition
  • The Ayurveda, Siddha or Unani drug can be advertised only after the allotment of the Unique Identification Number (UNN) with an objective other than restricted purpose.

OTHER COMPLIANCES ON PHARMA INDUSTRY

  • The Biomedical Waste (Management and Handling) Rules, 1998 require the setting up of requisite bio-medical waste treatment facilities and adherence with certain procedures for the disposal of bio-medical waste generated by the research activities or the testing of biological products
  • The Manufacture, Storage and Import of Hazardous Chemicals Rules, 1989 mandates that an occupier in control of a pharmaceutical industrial activity has to provide evidence of having identified major accidental hazards and taking proper steps to prevent major accidents
  • Director General of Foreign Trade has mandated the bar coding requirements for primary, secondary and tertiary level packaging of finished pharmaceutical products for export. Any non-compliance with the bar coding requirements can lead to counterfeiting or piracy of the pharmaceutical products.
# Form of Application Form of Grant of License Concerned Applicant Purpose
1 Form 44 Form 46 or 46A Manufacturer of new drugs Approval to manufacture the new drug and its formulations in Form 46 and for raw material in Form 46A
2 Form 40 Form 41 Manufacturer of drugs Registration Certificate for registration of the premises and the drugs manufactured by the manufacturer meant for import into and use in India
3 Form 8 Form 10 Importer of drugs License to import drugs excluding those specified in Schedule X (Schedule X is a class of prescription drugs in India which cannot be purchased over the counter without the prescription of a qualified doctor)
4 Form 8A Form 10A Importer of drugs License to import drugs specified in Schedule X
5 Form 12A Form 12B Importer for personal use of drugs License to import small quantities of drugs for personal use
6 Form 12 AA Form 11 Importer of new drugs License to import small quantities of new drugs by a Government Hospital or Autonomous Medical Institution for the treatment of patients
7 Form 12AA Form 11 Importer of drugs for Medical treatment License to import drugs by a Government Hospital or Autonomous Medical Institution for the treatment of patients
8 Form 29 Form 11, Form 12 or Form 30 Importer or Manufacturer of drugs License to import or to manufacture drugs for purpose of examination, test or analysis
9 Form 19AA Form 20BB or Form 21BB Wholesaler or Distributor of drugs License to sell, stock or exhibit or offer for sale by wholesale, or distribute drugs from a motor vehicle
10 Form 19-B Form 20C or Form 20D Retailer or Wholesaler of homeopathic drugs License to sell, stock or exhibit or offer for sale or distribute Homoeopathic medicines by retail or wholesale
11 Form-19 or Form 19A Form 20, Forms 20A, Form 20-B, Form 21, Form 21A, Form 21B and Form 21C Wholesaler of drugs Restricted licenses to dealers or persons in respect of drugs, whose sale does not require the supervision of a qualified person
12 Form 19-C Form 20F, Form 20G or Form 21C Retailer or Wholesaler of drugs A License to sell, stock, exhibit or offer for sale or distribute drugs specified in Schedule X by retail or by wholesale
13 Form 24 Form 25 or Form 25A Manufacturer of drugs License to manufacture for sale or for distribution of drugs other than those specified in Schedules C and C (1) and X (Schedule C and C(1) covers serum, hormones, vaccines, toxins, anti-toxins and other biological and special product)
14 Form 24A Form 26A Manufacturer or Distributor availing manufacturing facilities of other licensee Loan License to manufacture for sale or for distribution of drugs other than those specified in Schedules C and C (I) and X
15 Form 24B Form 25B or Form 26B Re-packer or Distributor of drugs License to repack for sale or distribution of drugs, being drugs other than those specified in Schedules C and C (1) excluding those specified in Schedule X
16 Form 24C Form 25C or Form 26C Manufacturer or Distributor of homoeopathic medicines License to manufacture for sale or for distribution of Homoeopathic medicines or a License to manufacture potentised preparations from back potencies by licensees holding License in Form 20C
17 Form COS- 1 Form COS- 2 Importer of Cosmetics Registration certificate for import of cosmetics into India
18 Form COS- 4 Form COS- 4A Importer of Cosmetics Import Registration Number for Import of already registered cosmetics
19 Form COS- 5 Form COS- 8 Manufacturer of Cosmetics License to manufacture cosmetics for sale or for distribution
20 Form COS- 6 Form COS- 9 Manufacturer of Cosmetics Loan license to manufacture cosmetics for sale or for distribution

https://cdsco.gov.in/opencms/opencms/en/Home/

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