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Indian Drug Regulator Accused of Corruption and Collusion

India’s top drug regulatory agency violated laws and colluded with pharmaceutical companies to approve medicines without clinical trials, a parliamentary panel said in a report.

The Central Drugs Standard Control Organization which oversees clinical trials and India’s 10,000 drugmakers, approved medicines from companies including Novartis AG (NOVN), GlaxoSmithKline Plc (GSK) and Mumbai-based Cipla Ltd. (CIPLA) without clinical trials required to be done in the country, the standing committee on health and family welfare said in a report tabled in parliament on May 8.

The committee also found drugs that were banned in the U.S., Europe and most developed countries because of their adverse side effects had been approved for sale in India.

“There is sufficient evidence on record to conclude that there is collusive nexus between drug manufacturers, some functionaries of CDSCO and some medical experts,” the report said. “Such irregular approvals spare drug producers the cost and efforts but put Indian patients at risk.”

The findings reveal an agency that may be putting industry interests over public health, in a country where pharmaceutical sales have increased an average of 14 percent annually since 2005. The regulator is understaffed, overburdened with drug approval applications and ineffective at regulating drugmakers, according to the report.

Harish Kumar, an assistant to G.N. Singh, Drugs Controller General of India, said the top official at the regulatory body was not at his office.

‘Global Ethical Standard’

Novartis follows “one global ethical standard for conducting clinical trials,” the company said in an e-mailed statement. Glaxo received a local clinical trial waiver from Indian authorities in 2010 for its ambrisentan drug to treat a rare form of hypertension, the London-based company said in an e-mailed statement. The drug is sold in 44 countries.

Jaisingh Krishnan, a spokesman for Cipla, India’s third-biggest drugmaker, didn’t immediately respond to e-mails seeking comment.

Systemic flaws ranging from lax oversight of clinical trials and the absence of a system to monitor side effects of newly introduced medicines have meant the agency lacks the authority of its counterparts like the U.S. Food and Drug Administration and the U.K’s Medicines and Healthcare Products Regulatory Agency.

‘Very Lax’

“The rules for clinical trials are very lax in India,” Anand Rai, an activist who has filed a case in the country’s top court claiming irregularities in the way patients for trials are chosen, said in a telephone interview. “The rules and regulations in Europe and the U.S. are very strict. In India we have so many loopholes that are exploited by pharmaceutical companies.”

Several clinical trials approved by the agency didn’t have a representative mix of patients from India’s main ethnic groups, rendering the data inconclusive.

“Such trials do not produce any useful data and merely serve to complete the formality of documentation,” the authors, including at least 30 members of parliament, said.

Investigation

The findings were based on a 1 1/2-year investigation of 42 medicines that were approved by the agency from 2004 to 2010. Of these, 31 new drugs were approved without conducting clinical trials on Indian patients.

At least two medicines, Paris-based Sanofi (SAN)’s dronedarone and aliskiran from Basel, Switzerland-based Novartis were approved on the basis of trials that were conducted on less than 50 people in India, even though the laws require a minimum of 100 patients.

The country has 92,000 brand names of registered pharmaceuticals, according to a compendium of medicines sold in the country. The World Health Organization, in contrast, recommends 340 essential drugs. About 90 percent of drugs sold are generics, which their manufacturers seek to differentiate with unique names -- making them branded generics.

The agency’s ease in granting approvals has resulted in hundreds of combinations of antibiotics being introduced in the last five years, and this may be playing a role to the emergence of antibiotic resistance in the country, said Narayan Prasad, an assistant professor of nephrology at the government-run Sanjay Gandhi Post Graduate Institute of Medical Sciences in Lucknow.

“A number of unjustifiable combinations have come into the market, and it’s the government’s job to prevent this from happening,” Prasad said.

India bans prescription-drug advertising, so companies use a sales force of 100,000 that is predicted to at least triple by 2020. The country’s market is estimated at $12.4 billion according to data from the All India Organization of Chemists and Druggists.

To contact the reporters on this story: Adi Narayan in Mumbai at anarayan8@bloomberg.net; Siddharth Philip in Mumbai at sphilip3@bloomberg.net

To contact the editor responsible for this story: Jason Gale at j.gale@bloomberg.net

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