FDA Clamps Down on Indian Drug Makers

Published Online: Tuesday, March 11, 2014
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While visiting India from February 10 to 18, 2014, FDA Commissioner Margaret Hamburg, MD, announced plans to increase regulation of pharmaceutical manufacturers in the country amid concerns about the safety of medications they produce. The number of FDA inspectors stationed in India, which is the second-largest supplier of generic medications to the United States, will increase from 12 to 19.

“We need the same level of oversight whether it is within our borders or outside,” Dr. Hamburg said, according to the Wall Street Journal.

In the last few years, the FDA has banned the sale of drugs in the United States produced by some plants in India run by Ranbaxy Laboratories Ltd and Wockhardt Ltd due to shortcomings in manufacturing standards. A Ranbaxy plant was accused of faking test results and found to have laboratories in disrepair and a sample-preparation room overrun with flies. Ranbaxy pleaded guilty to a felony and paid a $500-million fine, the largest ever imposed on a generic drug maker.

Inspections of Indian facilities are being financed with some of the approximately $300 million in annual fees being collected from generic drug manufacturers based on the 2012 Generic Drug User Fee Act. According to Dr. Hamburg, the additional inspectors will speed up the approval of Indian pharmaceutical plants.

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“GPhA applauds FDA for taking helpful steps to address, and hopefully limit, scenarios in which some brand drug companies misuse Risk Evaluation and Mitigation Strategies programs to thwart competition from more affordable generic drugs. The ongoing abuse of REMS and REMS-like programs costs the American health system and its patients $5.4 billion annually, according to a study conducted by Matrix Global Advisors. Interestingly, as the United States market readies for biosimilars, this same study identifies $140 million in lost savings that would occur for every $1 billion in biologics sales.
Generics saved $239 billion in 2013 (a 14% increase in savings from 2012) and more than $1.46 trillion over the recent decade. Further, the Express Scripts 2013 Drug Trend Report issued in 2014 shows that since 2008, the price of brand drugs has almost doubled, but the price of generic drugs has been cut roughly in half.
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