Pharma policy to seek R&D watchdog

The new pharma policy proposed by Chemicals Minister Ram Vilas Paswan is likely to call for a central mechanism to oversee research and development projects in the country.

The policy will also propose a revised eligibility criteria for R&D-intensive companies (gold standard companies) for availing the R&D benefits offered by the government.

According to official sources, the policy will have a system of maintaining central database on grants, implementation and outcome of the ongoing R&D efforts for better focus and to avoid duplication.

At present, R&D funding is being done by several government departments and organisations such as the department of ayurveda, yoga, unani, siddha and homoeopathy, Indian Council for Medical Research, department of scientific and industrial research, department of science and technology, department of biotechnology, and various state governments.

According to the proposed criteria for gold standard companies, investment of at least 3 per cent of the annual sales turnover on R&D per annum with a minimum of Rs 50 crore (Rs 500 million) per annum on research facilities would be required. The centres should employ at least 200 scientists (MScs, M.Pharm, or PhDs employed at least for one year) in India.

Owning and operating manufacturing facilities in India, which have been approved by at least two reputed foreign regulatory agencies like the USFDA or MHRA UK, is another eligibility criteria.

The ministry will also ask the companies to develop a strong linkage with the R&D institutes and academic institutions by initiating joint R&D projects. As reported earlier, the companies fulfilling the new eligibility norms would be eligible to charge an extra 50 per cent maximum allowable post manufacturing expenses on price-controlled drugs.

The norms are to be reviewed periodically and the eligibility of each company will be judged yearly.

Industry sources said the revised guidelines would work against upcoming pharmaceutical companies.

"According to the proposed eligibility criteria, only established pharmaceutical companies with sound R&D base can get the benefits. Instead of offering them assistance, the government should look at encouraging small companies that have the growth potential," said a source.