Govt Looking To Regulate Online Pharmacies, Medical Devices With Draft Bill

The draft New Drugs, Medical Devices and Cosmetics Bill 2022 will become the first legislation in the country to regulate online pharmacies. The draft Bill will replace the obsolete Drugs and Cosmetics Bill, 1945.

Interestingly, the move comes just over a month after the Confederation of All India Traders (CAIT) met the Union Health Minister Mansukh Mandaviya. Post the meeting, CAIT stated that the government is looking for ways to streamline online pharmacies.

Per the draft Bill, online pharmacies will now have to acquire a licence in order to continue operating.

Section 41, sub section (2) reads, “No person shall himself or by any other person on his behalf sell, or stock or exhibit or offer for sale, or distribute, any drug by online mode except under and in accordance with a licence or permission issued in such manner as may be prescribed.”

The provisions of Section 102 (3) also extend this to Ayurvedic, Homoeopathic, Sowa Rigpa, Siddha and Unani drugs and cosmetics. Furthermore, Section 130, sub section (4) extends the licence requirement to medical devices as well.

The section states, “No person shall himself or by any other person on his behalf sale, distribute or offer for sale the medical devices by online method, as may be prescribed, for which a licence or permission is required to be obtained from the licensing authority, except under and in accordance with such licence or permission subject to such exemptions and conditions and in such form and manner as may be prescribed.”

The draft New Drugs, Medical Devices and Cosmetics Bill 2022 also suggests the government create rules to regulate online pharmacies. While there are sections regulating the sale of drugs and medical devices in online pharmacies, there isn’t a separate chapter dealing with online pharmacies as a separate entity.

The draft bill has been uploaded on the Union health ministry’s website and the ministry has sought suggestions, comments and objections from the public and the stakeholders within 45 days from the date of issue of the notice, that is, July 8. Therefore, the draft bill is open for comments till August 23.

In the notification, the ministry said, “In light of recommendations of the Central Government and the felt need to have comprehensive legislation, a committee was constituted for framing the New Drugs, Cosmetics and Medical Devices Bill.” 

“As per recommendations of the Committee. The Ministry of Health and Family Welfare, Government of India proposes a draft New Drugs, Medical Devices and Cosmetics Bill, 2022 in order to keep pace with changing needs, times, technology,” the ministry added.

India’s e-pharmacy startup ecosystem includes the likes of IPO-bound PharmEasy, Tata-owned 1mg and Netmeds, along with Amazon and Flipkart’s pharmacy businesses and many other early and growth-stage startups in the field.

The draft New Drugs, Medical Devices and Cosmetics Bill 2022, if passed into legislation, will see online pharmacies apply for licences with the government to continue to operate.

According to an Inc42 report, healthtech startups in India have raised around $700 Mn in H1 2022. While the figure is about $100 Mn lower than a year ago, the Indian healthtech ecosystem saw more deals happen in H1 2022.