Please click here to download the Newsletter as a PDF.
Recent developments in the Indian healthcare and life sciences industry reflect a coordinated policy effort to reconcile public safety mandates with the government’s ease of doing business agenda. When viewed together, they signal a systemic transition toward trust-based governance, backed by strict accountability. This edition of the JSA Healthcare Newsletter focuses on the key developments undertaken in the Indian healthcare and life sciences ecosystem during May and June 2026.
Regulatory updates
Reforms to the drug price control regime
The Department of Pharmaceuticals (“DoP”), vide notification dated June 30, 2026, has notified the Drugs (Prices Control) Amendment Order, 2026 (“Amendment Order”) which introduces some of the most significant revisions to the Drugs (Prices Control) Order, 2013 (“DPCO”) in recent years.
Most notably, the Amendment Order empowers the National Pharmaceutical Pricing Authority (“NPPA”) to prescribe differential ceiling prices for the same formulation upon an application made by the manufacturer. Pertinently, the manufacturer would be required to establish that their drug offers a therapeutic advantage by virtue of its packaging, pack size or dosage compliance or delivery form.
Further, the process for an existing manufacturer looking to launch a new drug for which the ceiling price was fixed within the previous 12 (twelve) months has also been rationalised. Previously, all subsequent manufacturers were also required to obtain price approval, which led to delays. Pursuant to the amendment, any subsequent manufacturer launching the same formulation may adopt the price that has been fixed for the initial manufacturer, and notify the NPPA within 30 (thirty) days of launching the drug.
The Amendment Order also rationalises the liability of the manufacturer for overcharging by distributor or retailer, subject to the manufacturer being able to demonstrate that they exercised sufficient efforts to disseminate the applicable ceiling price to all stakeholders. Pertinently, the manufacturer is not absolved of liability, but the quantity of stocks based on which the liability will be computed is substantially restricted.
In addition, it has also been specified that all records relating to sales of individual active pharmaceutical ingredients or bulk drugs manufactured or imported and marketed by the manufacturer, as well as data of sales of formulation units and packs must be retained for a minimum period of 7 (seven) financial years.
Enhanced track-and-trace requirements for certain drug categories
The MoHFW, vide notification dated June 22, 2026, has brought all vaccines, antimicrobials, narcotic drugs and psychotropic substances, and anticancer drugs under the purview of Schedule H2 to the Drugs Rules, 1945, which establishes a QR code-based track and trace mechanism.
Schedule H2 was originally introduced as a risk-based regulatory category restricted to India’s top 300 (three hundred) pharmaceutical brands. By transitioning Schedule H2 from a brand-specific list to a category-wide list, the Central Drugs Standard Control Organisation (“CDSCO“) is effectively strengthening the integrity of the supply chain, safeguarding against the circulation of spurious and substandard drugs, and aiding the efforts against antimicrobial resistance.
Effective July 1, 2027 (or July 1, 2028, for antimicrobials) every brand of each of these categories of drugs must include a QR code on their primary or secondary packaging, which must store details of the unique product identifiers, the proper and generic name of the drug, name and address of the manufacturer, batch numbers, manufacturing date, date of expiry, manufacturing license number, and details of the excipients. By scanning this code, anyone may verify the drug’s authenticity and achieve complete visibility across the entire supply chain.
Cosmetics under regulatory scanner
Reinforcing the heightened scrutiny over cosmetics, the CDSCO, vide public notice dated May 18, 2026, has clarified that cosmetics are exclusively intended for the purpose of cleansing, beautifying, promoting attractiveness or altering the appearance, and that cosmetics cannot make therapeutic claims or be used for treatment purposes. The CDSCO also reiterated that cosmetics may only be intended to be rubbed, poured, sprinkled or sprayed to the human body, and products in the injectable form do not fall within the definition of a “cosmetic”.
This clarification comes in the context of growing concerns regarding the marketing and use of injectable aesthetic products (such as dermal fillers and skin-lightening injections) that were being licensed as cosmetics. Recently, the CDSCO also cancelled the import registration certificate that had been granted after discovering that therapeutic and disease-linked claims that were being made on the website and promotional materials.
These enforcement actions signal a maturing regulatory landscape for cosmetics in India. To mitigate compliance risks and avoid operational disruptions, companies must proactively reevaluate their product portfolios to ensure appropriate classification. Furthermore, establishing rigorous internal review mechanisms for all marketing materials, digital collateral, and label claims is now a commercial necessity to safeguard market access and maintain business continuity.
Growing emphasis on post marketing surveillance obligations
The CDSCO, vide circular dated June 3, 2026, has directed all stakeholders to establish and maintain a pharmacovigilance system in compliance with the Good Manufacturing Practices laid down in Schedule M of the Drugs Rules, 1945. The circular further directs officers of the CDSCO, State Licensing Authorities, and Union Territory authorities to verify compliance with pharmacovigilance requirements during routine inspections. Pertinently, the circular does not establish a new requirement, but merely reiterates an existing obligation, and signals a shift toward active enforcement of pharmacovigilance obligations during inspections.
Further emphasising the growing focus on post-marketing surveillance, the MoHFW, vide draft notification dated June 22, 2026, has proposed amendments to the New Drugs and Clinical Trial Rules, 2019 regarding the periodicity of Periodic Safety Update Report (“PSUR”) submissions. For background, most categories of new drugs are deemed to be new drugs for a period of 4 (four) years, and are required to submit PSURs for this period; every 6 (six) months for the first 2 (two) years, and annually in the subsequent 2 (two) years. However, (a) modified or sustained release forms or novel drug delivery systems, and (b) vaccines, r-DNA derived products, living modified organisms, monoclonal antibodies, cell or stem cell derived products, gene therapeutic products and xenografts intended to be used as drugs are deemed to be new drugs in perpetuity. Therefore, to ensure appropriate monitoring, the proposed amendment has introduced an additional obligation for marketing authorisation holders to submit PSURs thereafter once every 3 (three) years in case of (a) and annually in case of (b) for as long as the drug is being marketed. The proposed amendment aims to rationalise pharmacovigilance reporting obligations by calibrating PSUR frequency to the maturity of the drug’s safety profile, reducing the compliance burden on marketing authorisation holders for well-established products while maintaining robust oversight during the initial post-approval period.
Supply restriction on assisted reproductive technology devices
In an attempt to clamp down on the supply of media, reagents, and consumables used in assisted reproductive procedures to healthcare facilities that do not hold appropriate registrations, the CDSCO, vide circular dated June 23, 2026, has directed manufacturers, importers and distributors of such products to ensure that they are only supplied to centres duly registered under the Assisted Reproductive Technology (Regulation) Act, 2021 and the Surrogacy (Regulation) Act, 2021. Going forward, manufacturers and distributors would be required to implement a verification mechanism before fulfilling orders to healthcare facilities. This would include establishing an internal standard operating procedure for verifying that the clinic holds a valid registration, covering the activities that the goods being supplied are intended for. Manufacturers and distributors would also need to maintain records evidencing that they exercised due diligence.
Historically, under the Medical Devices Rules, 2017, manufacturers and distributors were only required to verify that the immediate buyer in the supply chain holds a valid sale licence. There has been no explicit directive requiring suppliers to investigate the downstream registration status of end-user institutions like hospitals or specialised clinics under separate, domain-specific acts. Therefore, this represents an unprecedented enforcement shift that bridges medical device distribution with clinical operations regulation, and the exact manner in which the CDSCO will monitor this compliance remains to be seen.
Decriminalisation of offences
Recognising the need to make laws more balanced and practical, the Jan Vishwas (Amendment of Provisions) Act, 2026 has decriminalised and rationalised several offences across legislations including certain healthcare laws – including the Drugs and Cosmetics Act, 1940, Pharmacy Act, 1948, the Clinical Establishments (Registration and Regulation) Act, 2010, and the National Commission for Allied and Healthcare Professions Act, 2021. Under these statutes, certain offences have been decriminalised, and the criminal sanctions have been replaced with monetary penalties. These amendments have since been notified, and will bring about a degree of operational certainty for companies operating in this industry.
This Newsletter is prepared by:
|
Sidharrth Shankar |
Eshika Phadke |
|
For more details, please contact km@jsalaw.com.
