APRIL 24, 2016

By M G Kodandaram

Everyone is concerned and occupied in finding out the solutions to make medicines (hereinafter, also referred as 'drugs') Affordable, Available and Accessible to the common man in India and the world around. When the debate and discussions continue on 3As, it is disheartening that no serious thoughts are given to provide Authentic medicines to the entire consumers. Due to the existence of the sub-standard and fake drugs over the counters the health of the every human being remains in danger. No doubt that all the laws concerned have prohibited these types of drugs which are causing huge health challenges to the all the classes of the people in the society, but still such drugs remain in the counters of the chemists. Though the manufacture, supply and selling of such medicines has been forbidden under law, the illegal activities continue to rule the National and International drug markets. Consumers in quest of economically cheaper alternatives are falling easy preys to these readily available sub-standard spurious medicines, which I like to name as MASKed medicines as they are transacted with masked credentials. The consumers knowingly or otherwise, use such MASKed drugs that lead to precarious health hazards which may culminate in death. The hard earned money of a poor person is getting spent for the procurement of such illegal MASKed drugs which is unfortunate.

The MASKed medicines have become a menace to the entire genuine health industry as it is taking away much of their business values and market share. But inspite of the negative impact, the fight by manufacturers and distributors of authentic medicines are not encouraging. Further the Government authorities who vouch for providing 'affordable medicines and good health for all' are turning a blind eye towards the 'MASK drug mafia' at work. It is really distressing that the Government agencies are not taking effective measures to eliminate these racketeers who are causing dents in the economy. The manufacture, sale, distribution as well as import /export of MASKed drugs are increasing day by day around the Globe, as the enforcement authorities have failed to regulate the trade of drugs as mandated. Shri Anil Sinha, Director, CBI while inaugurating the first indo-french workshop on "combating counterfeit medicine" in a press release dated 24.06.2015 observed, " Counterfeit drugs often contain the wrong amount of active ingredient – too little, too much or none at all – posing a major health risk. According to an estimate of Interpol fake medicine kill more people in a year than those who have died in the past 40 years as a result of terrorism. Fake drugs can kill and therefore the fight against Pharmaceutical Crime is crucial to protect global public health and safety ."

MASKed medicines

Let me make a start by explaining the term 'MASKed drugs' used in this article and the purpose behind it. In India, Under 'The Drugs and Cosmetics Act, 1940' (hereinafter referred to as the 'DAC Act' for brevity) , the regulation of manufacture, sale and distribution and import of drugs are being carried out by both central and state governments. As per the DAC Act (sections 10,18,33 EEC) any drug including Ayurvedic, Siddha or Unani, (i) which is not of standard quality and (ii) any misbranded , adulterated or spurious, are Prohibited from being manufactured for distribution or stock or exhibit or offer for sale or for import. Similarly the various IP laws define Counterfeited drugs as drugs manufactured without the consent from the rights holder or pass on a non-genuine drug as a genuine one, using the colourable imitations of the original producer.

As per the DAC Act (sections 9,17, 33E) a drug / medicine shall be deemed to be Misbranded drugs (a) if it is so coloured, coated, powdered or polished that damage is concealed or if it is made to appear of better or greater therapeutic value than it really is; or (b) if it is not labelled in the prescribed manner; or (c) 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 drugs (sections 9A,17A,33EE of DAC act ), (a) if it consists, in whole or in part, of any filthy, putrid or decomposed substance; or (b) if it has been prepared, packed or stored under insanitary conditions whereby it may have been contaminated with filth or whereby it may have been rendered injurious to health; or (c) 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 (d) if it bears or contains, for purposes of colouring only, a colour other than one which is prescribed; or (e) if it contains any harmful or toxic substance which may render it injurious to health; or (f) if any substance has been mixed therewith so as to reduce its quality or strength. Similarly a drug shall be deemed to be Spurious drugs (sections 9B,17B,33EEA of DAC act), (a) if it is imported under a name which belongs to another drug; or (b) if it is an imitation of, or 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 and conspicuously marked so as to reveal its true character and its lack of identity with such other drug; or (c) if the label or the 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 (d) if it has been substituted wholly or in part by another drug or substance; or (e) if it purports to be the product of a manufacturer of whom it is not truly a product. Further Counterfeiting a goods generally mean is to pass on a non-genuine product as a genuine, without the due permission or licence from the owner, (shall we call as MASKing ) which is rampant in medicine market also.

From the above definitions it can be concluded that the terms viz., Misbranded, Adulterated, Spurious and Counterfeiting drugs / medicines, which I desire to rename as MASKed drugs, are used to define 'non-genuine drugs with fake credentials in markings and deficient in efficacy' that are hazardous to the health and well being of the mankind. But all the names cited above have one common purpose and impact on the consumers i.e., to cheat and exploit consumers' health as well as wealth. I thought of having one word to name all the various nefarious activities so that it is possible to have a comprehensive definition to include all such criteria together and propose for a far-reaching law to enforce prohibitions of all such drugs and the related activities. By doing so it is possible to formulate an extensive and wide spread, but effective law that could be more evolved with the sole purpose to put an end to the fraudulent markets, products and the persons engaged in the anti-social evil activity.

The MASKed drugs market

The trade in MASKed drugs which runs as a parallel economy, moving drugs without proper documents, evades huge amounts in the form of taxes. The costs generated by law enforcement agencies in combating the MASKed drugs including handling and disposing of seized hazardous wastes are borne by the governments. Further the manufacturers of genuine standard medicines are directly affected by the loss of royalties and sales due to the infringements of IP. The Rights holders' brands or products are pushed out of the market by MASKed drugs. The rights holders are also affected by the preventive and reactive costs of combating illegal activities, drawing money away that could be used in innovation, improvements in quality, or other enhancements of the genuine product.

More than the above, the Impact on the health and safety of consumers buying MAS Ked drugs is disastrous. The illicit producers never take interest in matching the quality, safety or performance of the genuine goods. Therefore the intention and purpose of MASKed drugs is to manufacture fake drugs illegally, pass it on to the market as genuine drugs (medicines) and cheat the consumer . The Director, CBI recently stated "Counterfeit medicines are difficult to detect. No region or country is immune from this problem. These criminal networks are involved in all types of pharmaceutical crimes, such as falsifying, diverting, stealing or illicitly selling medicines over the Internet. According to an Interpol Report, two 'types' of Organised Criminal Groups seem to dominate this crime area: Highly organized, yet generally informal, international affiliate networks selling medicines via illicit online pharmacies as well as Small groups, not yet well established, of between 3-10 members, involved in various aspects of pharmaceutical crime."

According to WHO, 35% of the world's spurious drugs are produced in India. The spurious drugs worth nearly Rs 4000 crores, which are about 20% of the domestic pharmaceutical business, are manufactured in India. A large quantity of the spurious drugs is also either exported or smuggled out. USA has put India in 301-watch threat list. The ACG Report 2003estimates the trade by the MASKed drug industry to be worth USD 200 billion a year and termed it as the "The crime of the 21st century". It is said to be responsible for 3000 deaths across worldwide per year. According to BASCAP- "Pharmaceutical industry is the most counterfeited industry in India".

The parliamentary standing committee on health and family welfare in its fifty-ninth report on the functioning of the central drugs standard control organisation (CDSCO) observed as under: " .. most of the ills besetting the system of drugs regulation in India are mainly due to the skewed priorities and perceptions of CDSCO. For decades together it has been according primacy to the propagation and facilitation of the drugs industry, due to which, unfortunately, the interest of the biggest stakeholder i.e. the consumer has never been ensured. (Para 2.2). There should be severe punishment for manufacturing and for allowing sub-standard drugs to enter the distribution chain. Products with severe deficiencies should be penalized the same way as producers of spurious drugs by amending rules. There is also a case to incorporate penal provisions for manufacturing misbranded and adulterated drugs. (Para 15.6) ".

The Expert Committee under the chairmanship of Dr. R.A. Mashelkar constituted by central government to examine all the aspects regarding the regulatory infrastructure and the extent and problem of spurious/substandard drugs in the country in its report submitted in November 2003 about drug law and enforcement observed, " There has been a wide-ranging national concern about spurious / counterfeit / substandard drugs. The Supreme Court of India, the National Human Rights Commission and the Members of Parliament have time and again expressed a concern about improving the drug regulatory system in the country. Although the DAC Act has been in force for the past 56 years, the level of enforcement in many States has been far from satisfactory. The non-uniformity in the interpretation of the provisions of laws and their implementation and the varying levels of competence of the regulatory officials were the main reasons for this less than satisfactory performance ." The committee observed that the issue of non-uniformity of enforcement at the state level was serious and needs to be addressed immediately.

The wide spread law but poor enforcement

Under the 'DAC Act' the regulation of manufacture, sale and distribution or import 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 the standards for Drugs, control over the quality of imported Drugs, coordination of the activities of State Drug Control Organisations and providing expert advice with a view of bring about the uniformity in the enforcement of the Act. 

Under section 21 of the Act the Central Government or a State Governments have appointed Inspectors, being a person possessing the prescribed qualifications, who are empowered to enforce above Act. They have been authorised to enforce the conditions, limitations or restrictions in the import, manufacture or sale of drugs. They have vast powers (section 22 of DAC Act) to inspect goods and premises, draw samples, search any person, enter and search any place, stop and search any vehicle, vessel or other conveyance which, he has reason to believe, is being used for carrying any drug, examine any record, register, document or any other material object found and seize the same if he has reason to believe that it may furnish evidence of the commission of an offence punishable under this Act or the rules made thereunder.

As per section 11 of the DAC Act, the officers of Customs are empowered to exercise all the powers under the act at the time of importation and exportation of such MASKed drugs. Specific procedures have been laid down for monitoring Import of medicines under the act (section 39, 40 of DAC Act). The customs officers are empowered on par with drug inspectors to initiate action against MASKed drugs.

As per the DAC Act whoever himself or by any other person on his behalf engages in dealing with any drug deemed to be adulterated or deemed to be a spurious drug which is prohibited, among other penal measures, shall be punishable with imprisonment for a term which may extend to three to five years and a fine which may extend to five thousand rupees. (Sections 13 and 27 of DAC Act). The goods in question can also be confiscated (sections 14, 31, 33K of DAC Act) and t he company involved is also liable for prosecution (section 34 of DAC act.). In addition to the above, other important laws being employed to forbid the availability of MASKed drugs include the Customs Act, 1962 and Indian Penal Code 1860.

Under Section 11 of Customs Act, 1962 (hereinafter CA for brevity) the central government has the power to prohibit importation or exportation of goods for the purposes listed thereunder which include '(k) the protection of human, animal or plant life or health; (n) the protection of patents, trademarks, copyrights, designs and geographical indications. (o)the prevention of deceptive practices; (v) any other purpose conducive to the interests of the general public'. Further under Section 2 (33) of CA the "prohibited goods" have been defined as any goods the import or export of which is subject to any prohibition under this Act or any other law for the time being in force. From the above reading it can be concluded that MASKed drugs are prohibited goods and customs act empowers a customs officer to prevent import and export of such MASKed drugs. The IP Rights (Imported Goods) Enforcement Rules 2007 and the Automated Recordation and Targeting of IPR Protection (ARTS) take care of the management of identifying MASKed drugs. According to section 111 of CA confiscations of any prohibited imported goods are permitted. Similarly under section 113 of CA, any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in force in addition to confiscation, are treated as punishable. The above acts are treated as offences wherein imprisonment upto seven years, or with fine, or with both could be imposed (Section 135 of CA) and the companies involved could also be prosecuted (section 140 of CA).

Further under section 274 of Indian Penal Code 1860 (herein after IPC for brevity) whoever adulterates any drug or medical preparation in such a manner as to lessen the efficacy, such person is punishable with imprisonment of six months, or with fine of one thousand rupees or with both. Further under section 274 of IPC, if any one sells the adulterated drugs, or offers or exposes it for sale, or issues it from any dispensary for medicinal purposes as unadulterated, or causes it to be used for medicinal purposes by any person not knowing of the adulteration and under section 276 of IPC sells drug as a different drug or preparation are punishable as above. In addition to the above specific provisions, for the crimes which result in physical / mental injury or death of the person by use of MASKed drugs all other sections concerned with such offences could also be invoked.

Enforcement Agencies

The various legislations empower many governmental agencies to deal with issues relating to enforcement of prohibition in manufacture and supply of MASKed drugs viz., (i) The Health Department and the Drug Controller General of India and Drug departments of States (ii) The Customs in Customs area and (iii) the Police, the CBI and the Interpol. There are some more laws such as consumer act, IP act etc., which can be used to curb the supply and sale of MASKed drugs.

From the above it is clear that sufficient laws exist to enforce the drive against the MASKed drugs in India, but they are dispersed widely under various enactments and agencies. The same needs to be consolidated through a comprehensive law specifically dealing with enforcement to remove existence of MASKed drugs from the market. There is no specific trained manpower to execute enforcement in an effective manner so that the MASKed drug mafia disappears. To do so there is immediate need for creation of specific enforcement mechanism with specially trained cadres as recommended by Mashelkar committee. The entire stake holders, especially the consumers who are the victims should be involved in the activity. Doing so alone can save the lives of the citizen who have been target of these MASKed drugs. Let us make drugs (medicines) not only Affordable, Available and Accessible but Authentic which is more important.

(The author is a faculty, National Academy of Customs Excise and Narcotics (NACEN), Bengaluru.)