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MPSDMA calls for complete overhaul of D&C Act; asks govt to frame a new human-centric law
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Peethaambaran Kunnathoor, Chennai
September 08 , 2025
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In a bold move that could reshape India's pharmaceutical landscape, Dr. Darshan Kataria, president of the Madhya Pradesh State Drugs Manufacturers Association (MPSDMA), has called for the complete overhaul of the Drugs and Cosmetic Act of 1940.
He argues that the present drug act is an antiquated law, a relic of the British colonial era deliberately crafted to stifle domestic manufacturing, an opinion that has long been a quiet frustration among entrepreneurs. Kataria believes the act's severe provisions, which can lead to criminal charges, have become a very frightening deterrent for innovators and professionals. His appeal for a new, human-centric law, one that balances medicine safety with the dignity and rights of the industry, presents a fundamental challenge to the status quo and ignites a debate over the future of India's small-scale pharma sector.
In an online chat with Pharmabiz, he said the pharmaceutical industry in Madhya Pradesh is on a mission to regain its former glory. The state lost its leadership position to Gujarat and Maharashtra about a quarter century ago due to a lack of government support. However, the industry leaders are now confident that with the responsive and proactive government support, the industry will regain its lost position. This renewed push is built on a strong foundation of historical pharma education and an entrepreneurial spirit, particularly in Indore. The government’s new focus on active pharmaceutical ingredients (API) and medical devices is expected to propel the sector to new heights.
Talking about the sequential growth of the industry, the state pharma leader said MP’s pharmaceutical sector is showcasing its specialized strengths while strategically expanding into new areas. The state holds a unique leadership position in the manufacturing and supply of large volume parental (LVP) and small volume parental (SVP) products, such as injectables and infusions. These products are supplied across India and exported globally. Beyond these core strengths, Dr. Kataria notes that the current state government is prioritizing the development of API and medical devices manufacturing. This shift indicates a forward-looking strategy to diversify the industry's base and tap into high-growth sectors, promising significant future expansion.
Talking about the financial viability of the manufacturing units, Dr. Kataria said the small and medium-sized pharmaceutical units in Madhya Pradesh are grappling with a financial crisis rooted in the country's tax system. Many of these units, which provide the most economical medicine, are engaged in contract manufacturing (job work). However, they are being hit hard by the ‘inverted duty structure’ under the GST law. According to him, this structure takes away working capital in blocked funds and creates a financial liquidity draught, threatening the survival of these businesses. The association has made representations to the government and is optimistic that the issue will be addressed in the upcoming GST 2.
When asked about the earlier plan of a pharma cluster in Indore, he said the dream of a dedicated pharma cluster in Madhya Pradesh has been put on hold. Dr. Darshan Kataria revealed that his association had planned to develop a pharma cluster some time earlier. However, the plan has been retracted due to a bad experience with a previous project, the Pithampur Auto Cluster. Dr. Kataria, a shareholder in that project, stated that the negative experience has shaken our confidence, leading them to back away from similar large-scale, collaborative ventures. This decision highlights the significant risks involved in such initiatives.
This challenge is particularly acute given the composition of the state's pharmaceutical sector. The pharmaceutical industry in MP is characterized by its diversity in size and scope, with a total of approximately 200 to 225 units. The state is home to a mix of major Indian-grown multinationals like Sun Pharma, Cipla, ACG, Glenmark, and Torrent, as well as a significant number of small-scale units. About 50 to 75 of these are large units, mainly located in Pithampur and Indore. The remaining 150 or so are MSMEs, with a high concentration in Indore. While many of the big players have already complied with the new Schedule M, the smaller units are at various stages of compliance, highlighting the varied challenges faced by different segments of the industry.
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