National Drug Regulatory Panel Rejects Wholesale License Caps, Calls for State-Level Monitoring

A national drug regulatory panel refused to cap wholesale drug licences, arguing that a national limit could be impractical. However, it asked state drug regulators to be more vigilant about the potential misuse of these licences for high-margin retail sales. Several pharmacist bodies sought to regulate wholesale licences based on the number of retail licences, but the panel said such a uniform approach might not work across different markets. Licensing needs vary across regions, the panel noted, telling state drug authorities to assess local requirements. The issue was considered at the 70th meeting of the Drugs Consultative Committee (DCC) where the committee was examining a representation from the pharmacists’ associations seeking a review of the framework for granting retail and wholesale drug licences, including a proposal to regulate the ratio between the two categories. The proposal was aimed at addressing concerns over the possible misuse of wholesale licences for retail sales. For instance, a wholesale licence allows a business to supply medicines to authorised entities, while retail licences cover sales to consumers. In some cases, wholesalers would sell medicines directly to consumers. This can blur the line between wholesale and retail sales, it was highlighted. “Members observed that the requirements differ considerably between urban, rural, industrial and geographically remote areas and that a uniform numerical ratio would not be practicable throughout the country,” the panel noted. For wholesalers and distributors, the move leaves room for licences to be added where market requirements change. A fixed national limit could have restricted this flexibility, particularly in markets where demand and supply needs differ. “The move could make it easier for manufacturers to maintain distribution networks suited to different markets. Drugmakers depend on wholesalers and distributors to get medicines to pharmacies, hospitals and other buyers. A fixed national limit could have made it harder to add distributors where they are needed,” said spokesperson of a pharma association. Though experts said that it could also put greater responsibility on state drug authorities many of whom are facing shortages of drug inspectors and other regulatory resources. They will have to assess applications individually while continuing to monitor existing licence holders and act against violations. Further, the DCC has retained the 60-day statutory timeline for testing drug samples, thereby rejecting a proposal to reduce it to 15-30 days. The DCC said that shortages of lab personnel, high sample loads and the complexity of some tests made it difficult for laboratories to complete testing within a shorter timeframe.