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TYPED COPY
Final Report of the Committee
Set up to determine
The reasons for the suspension of the manufacturing licenses of
CRI, Kasauli, PII, Conoor
And
BCGVL, Guindy
And to draw the road-map for the revival of the three Unis
September, 2010
Contents
S.No. Section Page No.1. Background 4 – 72. Deliberations of the Committee 7 – 103. Process Followed in Government in Suspending Licenses 10 – 144.1 Committee’s Observations on the Process Followed 14 – 154.2 154.3 164.4.1 Issues Relating to WHO 16 – 204.4.2 Span of Indian GMP Norms 20 – 254.4.3 Due Diligence in Examination of Issues 25 – 294.4.4 Purpose of Notifying GMP standards 29 – 314.4.5 Role of DGHS 32 – 334.4.6 National Health Security 34 – 354.4.7 Evaluation of Public Interest 35 – 375. Impact of Closure on the UIP 37 – 396. Revocation of Suspension 407. Upgradation of Public Sector Vaccine / Sera Units 41 – 428. Organizational Restructuring 42 – 439. National Vaccine Security Advisory Board 43 – 4410. Summary 44 – 53
Annexure Annexure A Summary of the points made by the Former Health Minister
before the Committee
54 - 55
Annexure B Note dt. 13.9.10 submitted to the Committee by Director
General, DGHS
56 - 57
Annexure C Chronological Account of Process of File No. X –
11026/1/2006-D
58 - 61
Annexure D Chronological Account of Process of File No. X –
11026/1/2006-D (pt. File)
62
Annexure E Chronological Account of Process of File No. M –
11035/3/06/EPI
63
Annexure F Note of Dissent by Vineet Chowdhury – Member Secretary –
Para 4.4.3.9
64
Annexure G Supply of Vaccines from Public and Private Sector
manufacturing Units in the Period 2004-05 to 2009-10
65-67
Annexure H Installed Capacity of Primary Vaccine Manufacturing Units in
Public and Private SectorsAnnexure I Universal Immunization Programme – Achievements for the
Period 2008-09Annexure J Universal Immunization Programme – Achievements for the
Period 2009 – 10
70
Annexure K Plan Allocation and expenditure in PII,Conoor & CRI,
Kasauli & BCGVL Guindy Between 1995 – 96 and 2009 – 10
71
Annexure L Additional points by Dr. VM Katoch (Member Committee) 72 – 73
Final Report of the Committee set up to determine the reasons for the suspension of the
manufacturing licenses of CRI, Kasauli, PII, Conoor and BCGVL, Guindy, and to draw the road-
map for the revival of the three Units.
I. Background
A Committee to enquire into the captioned issue was set up by an order of the Ministry of
Health and Family Welfare dated 25.9.09. The composition of the Committee was as
under:
i. Shri Javid Chowdhury, Former Secretary, Ministry of Health and Family
Welfare Chairman.
ii. Dr. VM Katoch, Secretary, Department of Health Research – Member
iii. Dr. RN Salhan, Former Additional DGHS – Member
iv. Mrs. Shakuntala D. Gamblin, Joint Secretary, Dept. of Health and Family
Welfare – Member Secretary.*
* Since transferred and replaced by Shri Vineet Chaudhury, Joint Secretary,
Dept. of Health and Family Welfare
The terms of Reference of the Committee were as under:
i) To review the reasons for suspension of the manufacturing licenses of the three
institutes, namely, Central Research Institute, Kasauli, Pasteur Institute of India,
Conoor, and BCG Vaccine Laborary, Guindy.. Chennai from the historical,
technological, administrative organizational and other perspectives:
ii) To review the road map for the revival of CRI, Kasauli, PII, Conoor and BCG,
Guindy to make them Good Manufacturing Practices (GMP) complaint.
At an early stage of its deliberations the Committee came to the conclusion that with the
abrupt closure of the public sector manufacturing units. Vaccine Security and
consequently Public Health Security of the country, had been dealt a severe blow. In view
of this, the Committee submitted an Interim Report on 5 th Feb. 2010, with certain
suggestions, which in its opinion required urgent action on the part of the government.
The Committee is very happy to note that the government accepted several of the
recommendations and effected the suggested changes through consequential orders.
The significant recommendations that have been adopted and implemented by
government include:
(i)
(ii) Revocation of the suspension of the manufacturing licenses of the three Units
i.e. restoration of these licenses in response to the appeals filed by the units
under Rule 85(3) of the D&C Rules:
(iii) Release of the finished products that were impounded consequent upon the
suspension of the licenses, for use under the UIP before their date of expiry.
(iv) Authorization of the management of the units to restart the renovation / up-
gradation of the existing production lines, and, the release of adequate funds to
keep these works moving smoothyly.
(v) Grant of formal approval to the units to initiate action to set up new production
lines at the existing sites.
The Interim Report of the Committee noted that it will require more time to study and
arrive at its conclusions on the full span of the terms of reference. Specifically, the
Committee in this Final Report will be looking at the term of reference relating to the
reasons for the suspension of the manufacturing licenses from the historical,
technological, administrative / organizational and other perspectives.
The Interim Report set out the background to the ‘Vaccine Availability’ scenario existing
in the country. This account, inter alia covered: (i) the use of primary and other vaccines
in the health sector; (ii) primary vaccine coverage under the UIP; (iii) the vaccine
manufacturing units in the country, in both public and private sectors; (iv) the installed
capacity for the different vaccines in the three manufacturing units under review of this
Committee; (v) the extant GMP standards for vaccines / sera under Schedule M of the
D&C Act; (vi) the authority of the Central / State Governments to carry out inspections
of licensed drugs and pharmaceuticals manufacturing units under Rule 85 of D&C Rules
for non-compliance with any of the rules or other legal provisions. The Committee does
not consider it necessary to repeat the details of the background information in this Final
Report. Interested readers may refer to paras 1.1 to 1.5 of the Interim Report.
The DCGI, through its authorized inspectors, from time to time, on a rotational basis,
inspects the manufacturing units. The inspection staff available to the DCGI for carrying
out this function is very limited (40 drug inspectors) and consequently the number of
units inspected annually are limited – between the year 2004-05 and 2008-09 the number
has ranged from 775 to 1163 annually. In the year in which the public sector unit licenses
were suspended (year 2007-08), the number of inspections was 889. The three public
sector units were inspected by the NRA in years 2001, 2004 & 2007. In the year 2001 &
2004 the inspection was carried out exclusively by Indian inspectors authorized by the
DCGI. In the year 2001, WHO had asked to be associated with the inspection, but
permission was explicitly denied by the Indian Government. The position then taken by
the Ministry of Health and Family Welfare was that in the course of the inspection, the
NRA is discharging a sovereign function in which an international agency cannot become
a partner. In year 2004 the WHO was not associated with the Inspection. In year 2007 the
WHO again asked to be associated and the Ministry agreed to the request with the
approval of HFM.
In the year 2007-08 a joint inspection of the three public sector units was carried out
under Rule 78(d) of the D&C Rules by Indian inspectors authorized by the DCGI, along
with WHO nominated inspectors on the dates given below:
Table I
Name of Manufacturing Unit Date of Inspection Central Research Institute, Kasauli 13th – 14th Aug., 2007Pasteur Institute of India, Conoor 9th – 10th Aug., 2007BCG Vaccine Lab. Guindy 11th – 12 Aug., 2007
The inspection reports pointed out several shortcomings in the infrastructure and
operational systems of the units. Based on the deficiencies listed in the inspection report,
under the powers invested under Rule 85(I) the DCGI and CLAA under its letter N.X
11026/21/2006 dated 14.12.07 (identical number for all three units), directed the
manufacturing units to show cause within 10 days from the receipt of the notice why the
license granted to them should not be suspended / cancelled.
Consequent to that, the three manufacturing units, on the dates listed below, replied to the
show cause notices on:
Table 2
Name of Manufacturing Unit Date of reply to show cause noticeCentral Research Institute, Kasauli 4th Jan., 2008Pasteur Institute of India, Conoor 4th Jan., 2008*BCG Vaccine Laboratory, Guindy 27th Dec., 2007
In general, the manufacturing units in their replies furnished information on those items
listed as deficiencies that had been rectified, as also the likely time-line for the ones
requiring rectification over a longer time span. On receipt of these replies, the DCGI
again directed the inspectors to undertake another inspection to verify the reported
compliance by the units. The inspectors carried out the second inspections on the dates
mentioned hereafter:
* It is clarified that there is no error in this date – the fact is that the unit was inspected for the
second time before the representation had been sent by the unit against the show-cause notice.
Table-3
Name of Manufacturing Unit Date of Second InspectionCentral Research Institute, Kasauli 7th – 8th Jan., 2008Pasteur Institute of India, Conoor 3rd Jan., 2008*BCG Vaccine Laboratory, Guindy 4th – 5th Jan, 2008
The Reports on the second inspection carried out of the units in early Jan., 2008
confirmed the rectification of some of the earlier listed deficiencies, while listing other
deficiencies that were still to be rectified. However, it needs to be pointed that though the
Reports of the two inspections carried out in Aug., 2007 and Jan., 2008 mentioned
deficiencies, no inspection report recommended the suspension / cancellation of the
licenses.
2. Deliberations of the Committee
2.1.1 The Committee held eight sittings on 25th Sept. & 15th Oct., 2009 and 5th Jan., 13th May,
16th June, 12th July, 11th Aug., 16th Sept. 2010 – when it has had intensive discussions. At
the meeting held on 15th Oct., 2009 the Committee had the opportunity to meet Dr.
Surinder Singh, DCGI with whom it discussed the various circumstances and the
documents relating to the issue. Incidentally, it may be mentioned that Dr. Surinder Singh
was not the DCGI at the time of the suspension of the licenses. The Committee as a part
of its deliberations, visited the three manufacturing units to review the circumstances in
which the licenses were suspended, and to assess the possibility and time-line for re-
starting the manufacture in the existing production line, while concurrently upgrading the
manufacturing standards to as rigorous a GMP standard as is possible. During the
meetings, the members asked the Ministry / DGHS / DCGI to provide copies of various
relevant documents. The files that have been furnished are: F.No. X-11026/1/2006 – D: F
No. X – 11-26/1/2006 – D [pt. File] and F. No. M – 11035/3/06/EPI. The DGHS &
DCGI have given in writing that they have no other papers / files on the issue under
review. The Committee’s visit to the manufacturing units was to review the situation at
the site and to discuss the possibilities for future action with the staff of the units (CRI.
Kasauli – 21 – 23, Nov 2009; PII. Conoor & BCGVL, Guindy – 19 – 22 Dec., 2009).
Various items of information were also obtained from the management regarding the
functioning of their units. The Committee submitted an Interim Report on 5 th Feb 2010
making certain recommendation that in its judgment required immediate attention of the
government.
2.1.2 The Committee would like to record that it had decided not to invite, on its own initiative,
any individual involved in the process of decision –making, in the course of its
proceedings. The Committee was of the view that its status was that of a fact-finding
Committee carrying out an administrative inquiry on the basis of the official records.
Inviting witnesses would greatly widen the inquiry, and it would not even be possible to
exactly determine who to invite and who not to, in the limited time available to it.
2.1.3 In the course of the proceedings the Committee had learnt through the Member-
Secretary, that the former HFM/ the former Secy. (HFW) and the DCGI wished to appear
before this Committee – the Member Secretary was in touch with these individuals and
carried messages back and forth. The Committee had an open mind on the request
conveyed by the HFM/Secy. (HFW)/DCGI. However, on reflection, it was realized that if
the Committee on its own invited witnesses, its proceedings would become of the nature
of a Commission of Inquiry. It was assessed that something like twenty five witnesses
from all over the country (all the officials of the Ministry/DGHS/DCGI: the past and
present Directors of the manufacturing units, the heads of the various inspection teams
that carried out inspections of the units from time to time; etc) would have to be called,
which would be impossible in the limited time available to the Committee. After serious
reflection the Committee came to the consensus conclusion that no purpose would be
served by calling witnesses for oral evidence. The fact-finding inquiry being conducted
by the Committee was on an issue that necessarily had to be conducted in the official
documents – the relevant facts are all a part of the official record: no particular value
would be added to the inquiry by calling witnesses. In the circumstances, the Committee
decided not to call any witnesses, but if any individual on his own initiative indicated an
interest in interacting with the Committee, such a request would be considered.
2.1.4 It may be mentioned here that the former – HFM expressed a desire to meet the members
of the Committee. In response to this, the Committee met the former – HFM on 13.5.10,
when he presented his perception of the process adopted by the Ministry in examining the
issues relating to the GMP standards of public sector vaccine manufacturing units. A
summary of the points made by the former HFM in course of the meeting is placed at
Annexure A. The significant points were: no pharmaceutical / vaccine unit that is non-
compliant with the GMP is functioning today – two thousand units were shut down in his
time for non-compliance – exception could not be made in the case of public sector units;
decision was not a sudden one – was discussed over a long period with the officials; our
public sector units are nowhere near the standard of modern units in Europe and USA;
deficiencies had been pointed out in a series of inspections – what action was taken to
rectify them; the integrated vaccine park proposed at Chengallapattu would enable the
production of new vaccines and vaccine – combos; under the law, DCGI can take a
decision independently. The perceptions presented by the Former-HFM have been taken
into account by the Committee in coming to its conclusions in this Final Report.
2.1.5 The former-Secy (HFW) and the DCGI were individually informed of the Committee’s
position on the issue of hearing of individuals. The former-Secretary asked for a copy of
the draft Final Report in order to know the issues on which he should respond. He was
informed that, since he was not being called by the Committee, no issues would be raised
by the Committee on which a response was sought. Since the individual wished to come
on his own initiative, it would be for him to choose the issues to be addressed. Also, since
the proceedings of the Committee were not in the public domain, it would not be possible
to supply him a copy of the draft Final Report; in fact even the Final Report would have
to be submitted directly to the Ministry only. At the end of exchange of some messages,
the former Secretary (HFW) indicated that he will not be seeking a hearing.
2.1.6 A procedure similar to the one adopted for the former Secretary (HFW) was adopted to
ascertain the intention of the DGHS. The DGHS indicated that, instead of asking for a
hearing, he would be giving a written note on the subject. The DGHS has submitted a
note-dated 13.9.10 along with several enclosures, setting out his perception on the
process adopted for coming to a conclusion on the issue of the closure of the units. A
copy of DGHS’ note is placed as Annexure B to this Final Report. The enclosures are the
very same documents that had been submitted by the Ministry/DGHS/DCGI to the
Committee, and form the basis of the analysis contained in this Report. The points raised
in DGHS’ note have also been kept in mind in the course of finalization of this Report.
2.1.7 The Summary of the Committee’s observations as to the status of the existing units is
given location-wise in paras 2.2, 2.3&2.4 of the Interim Report. The current status of the
manufacturing units was the basis of the recommendation in the Interim Report for
revoking the order suspending the manufacturing licenses of the units. This
recommendation has been accepted by the government and the suspension of the
manufacturing licenses has been revoked on 26-2010. In view of this, the Committee
does not consider it necessary to repeat the findings of the inspections of the units in this
Final Report. Those readers interested in the findings of the inspections may kindly refer
to the relevant sections of the interim Report.
2.3. The Committee was of the view that some of the recommendations given in the interim
reports were of far-reaching importance. Considering the gravity of those
recommendations, the analysis relating to them in the Interim Report was rigorous and
the reasoning was given in detail. In respect of those issues the matter has come to a
close. However, in order to make the Final Report an integrated and coherent whole, the
significant sections of the interim report have been reproduced in this Final Report. The
Committee could have refrained from this, and could have merely given a reference to
the text in the Interim Report, as has been done in the case of some of the less significant
aspects. However, the Committee felt that the broad expanse of the terms of reference
entrusted to it covered vital issues relating to public health security, and it would be
desirable that the gamut of these issues be presented as a integrated whole in the Final
Report.
3. Process followed in Government in suspending Licenses
The final decision to suspend the licenses of the three units was taken by the DCGI after
seeking the comments of the Ministry of Health & Family Welfare. The Ministry, in turn,
examined the issue over an extended period of eight months. The Committee has made
strenuous efforts to gain access to all the files on which these issues came to be
discussed. According to the information made available to the Committee, the issues
were discussed in the following three files:
i) File No. X – 11026/1/2006-D: Chronological statement of
events on the file placed at Annexure ‘C’
ii) File No. X – 11026/1/2006-D: Chronological statement of
events on the file placed at Annexure ‘D’
iii) of File No. M – 11035/3/06/EPI: Chronological statement of
events on the file placed at Annexure ‘E’
The Chronological Statement of Events on File No. X – 11026/1/2006-D, placed at
Annexure B, indicates that the examination of the relevant issues began as far back as
April, 2007 and terminated on 14.12.07, when a view was reached to issue show cause
notices to the units for suspension of their licenses. The first note floated on 5.4.07 inter
alia, covered the following points: (i) Raised the question whether WHO should be
permitted to join NRA’s inspection of the public sector units: (ii) pointed out that WHO
expects all public sector units to comply with its GMP standards, and also all other WHO
pre-qualification requirements; (iii) pointed out that if the NRA is de-recognized by
WHO, private sector vendors, who otherwise comply with GMP standards would become
ineligible for empanelment and India’s exports will suffer; (iv) that in year 2002 WHO
was not permitted by government to join the NRA inspection as that would tantamount to
WHO exercising regulatory control over the NRA; and (v) to meet WHO’s requirements,
government will have to shut-down public sector manufacturing facilities, impact on
availability of vaccine on public health programmes would have to be assessed.
DGHS, to whom the file was marked, made no substantive comment before passing it on
to the line-up in the Ministry.
Secy, (HFW)* took a meeting on 3.5.07 where a tentative decision was taken to allow
WHO to join the NRA inspection. Consequent to that DCGI through his note dated
3.5.07 submitted the proposal for allowing WHO to join the NRA inspection for approval
of HFM. The Committee notes that the DCGI’s proposal did not give any reasoning for
departing from the earlier decision taken by government in year 2002 to not permit
WHO to join the NRA inspection. Also, DCGI’s note dated 3.5.07 did not raise the other
issues highlighted in his earlier note dated 5.4.07. HFM’s final order dated 10.5.07,
permitting WHO to join the NRA inspection was limited to that point only.
It appears from the subsequent record that Secy. (HFW) took a meeting on 11.9.07 to
discuss the connected issues. The Minutes of the meeting listed the following decisions:
(i) Public Sector units should wind-down operations by stopping procurement of raw
materials and production; (ii) the units urgently prepare a plan for setting up new
manufacturing facilities and (iii) efforts be made by the UIP Div. to build up buffer
stocks to meet possible shortages.
DCGI’s note also recorded the following decisions taken at a subsequent meeting chaired
HFM (i) Ministry should take up with WHO Hqs the need for a longer period for up-
gradation of the manufacturing facilities; a team of senior officers be sent to Geneva for
holding discussions with WHO officials; (ii) immediate steps to be taken to improve the
manufacturing facilities by renovation/setting up new facilities to comply with the
deficiencies pointed out by WHO; and (iii) the plan to set up an integrated Vaccine Park
at Chengallapattu be immediately drawn up.
This note of the DCGI was seen by DGHS on 25.10.07 no substantive comments were
offered by DGHS – the file was marked to the administrative division (JS [DP]) in the
Ministry.
From the administrative division, on 31.10.07 JS (DP) put up a note suggesting that
WHO be approached for grant of more time for the public sector units to rectify the
observed deficiencies in the GMP standards of the unit. The note also suggested that the
units be asked to expedite their action plans. In other words, JS (DP)’s note supported the
earlier note of DCGI.
At this stage, the action seems to have been shifted to F. No. X – 11026/1/2006 – D – (pt.
File) the chronological statement of events of which is given in Annexure D. It appears
that since no orders had been received on the main file, DCGI sent a fresh note dated
27.11.07 giving the background of the build up of the issues that now required urgent
attention.
* Whenever the expression HFM or Secy. (HFW) or DCGI is used in this report it means
the then HFM, the then Secy. (HFW) and the then – DCGI.
This note of the DCGI was see by DGHS on 25.10.07; no substantive comments were
offered by DGHS – the file was marked to the administrative division (JS [DP]) in the
Ministry.
The note of DCGI dated 27.11.07 mentions an earlier note put up on 20.10.07 giving the
principal findings of the draft / final report of the joint NRA-WHO inspection of the
manufacturing units. It appears from contextual references that some of the earlier notes
mentioned by DCGI are not available now. Every effort has been made to obtain
whatever is available in the Ministry/DGHS/DCGI offices. The Report of the Committee
is necessarily based on the documents made available by the Ministry/DGHS/DCGI. It
appears to the Committee that this confusion in the records is the result of chaotic
secretariat practices, there is no reason to believe that any relevant papers/files have been
intentionally withheld from the Committee. It is clear that the style of secretariat
functioning in the Ministry/DGHS/DCGI offices at that point of time was unsystematic.
The only explanation for the confusion in the notes is that several notes were floated from
the DCGIs office from time to time with the same file number, without mentioning that
these were part files. At some subsequent date these were merged together without
ensuring continuity of proceedings. As a result, there are anomalies in the sequence of
recorded proceedings as is evident from Annexure C.
DCGI’s note of 27.11.07 also contained a draft interim reply proposed to be sent to the
WHO, indicating that many of the deficiencies noted in their report had been rectified
and stating that the reply on the action proposed for the public sector manufacturing units
would follow. There is nothing on record to show that any letter was issued.
In Annexure C there is a mention of notes submitted on 3.12.07 and 6.12.07 reminding
the senior officers that an earlier file that had been submitted for orders, has not been
returned; and that a reply has to be sent to WHO before 5.12.07. The chronological list of
events in Annexure D shows that on 28.11.07, AS (DG) inquired about the plan of action
of the units for rectifying the short-comings and suggested that a letter be sent to DG,
WHO explaining the government’s point of view. In response to this, JS (BKP) put up a
note on 1.12.07 spelling the highlights of WHO’s inspection report and mentioning the
meeting taken by HFM on 11.9.07. He also asked for directions for adoption of one of the
two opinions (i) negotiate with WHO for more time for compliance (ii) move towards
gradual shut down of the units and make alternative arrangements for the UIP.
In response to this, As (DG) in turn, in his note dated 1.12.07 suggested the following
line of action : (i) that the units move towards gradual shut down; (ii) the Ministry move
towards setting up a new integrated vaccine unit; (iii) the Ministry take up the issue with
the DG, WHO during his ensuing visiting to Delhi.
Secy. (HFW) supported the proposed action of AS (DG) while at the same time making
some observations on the need to alter the organizational structure of the existing units.
Further on in this file on 13.12.07 the HFM recorded that he had discussed the matter
with Secy (HFW) and directed action be taken in terms of the discussion. From the
context of note, and the content of subsequent notes, it is beyond doubt that the HFM
approved the proposed line of action.
From Annexure C it appears that a meeting was taken by HFM on 13.12.07 to take a final
view on the question of issue of show-cause notices to the units for suspension of their
licenses. DCGI recorded a note on 14.12.07 listing the following views reached in the
abovementioned meeting taken by HFM (i) recommending the issue of show cause
notices to the units for suspension of the licenses for non-compliance with GMP
standards (ii) asking the units to draw up a time frame for rectification of the deficiencies
pointed in the WHO inspection (iii) making a presentation to the expert body of WHO
regarding India’s response to WHO’s report. This note was seen and signed by the Secy.
(HFW) on 14.12.07. Consequent to the view conveyed by the Ministry, DCGI issued
show case notices of No. X – 11026/1/2026 – D dated 14.12.07 for suspension of the
licenses till such time as the deficiencies were rectified.
As mentioned in para 1.8 the DCGI directed that inspections be carried out of the
rectifications mentioned in the representations of the manufacturing units. The Reports on
the second inspection of the units in early Jan 2008 confirmed the rectification of some of
the earlier listed deficiencies, while listing other that were still to be rectified. However, it
needs to be pointed out that, though the Reports of the two inspections carried out in Aug
2007 and Jan 2008 mentioned deficiencies, no inspection report recommended the
suspension / cancellation of the licenses. Subsequent to the receipt of the representations,
the DCGI suspended the licenses of the units under his order No. X-11206/1/2006-D
dated 15.1.08 for violations of the following two provisions:
(i) the untis were not maintaining adequate standard of premises, plant and staff as
required under Rule 78(a)(I) of the D&C Rules.
(ii) the GMP standards for manufacture of drugs as set out in Part I and Part I A
Schedule M of the D&C are not being followed as required under Rule 78(p).
When reviewing the recent history of the three public sector vaccine manufacturing units
one aspect kept that these units have received an exceptional degree of attention from the
regulatory authorities. Over the years, the units have been inspected by the state and
central drug control authorities time and again (BCG, Guindy (5/2001 to 2/2008) – 10
inspections: PII Conoor (10/99 to 3/2008) – 9 inspections and CRI. Kasauli (9/2002 to
1/2008) – 5 inspections). The NRA has itself inspected the units in 2001, 2004 and 2007.
While diligence in the regulatory duties is something which should be commended, it
must not take the shape where it is perceived that these units are particularly targeted.
There are over 10,000 drugs and vaccine/sera units in the country, out of which all at but
350 are in the small scale sector. DCGI has 40 drug inspectors under him who carry out
statutory inspections on his behalf. The number of inspections carried out by the central
drug inspectors in different years is as under:
Inspections carried out by Central Drug Inspectors
Year Number of Inspections2004-05 11632005-06 8472006-07 7752007-08 8892008-09 764
Under the law, the DCGI (CLAA) has jurisdiction over all drugs and pharmaceutical
manufacturing units in the country, including those categories for which the registration
powers are with the state governments. However, the DCGI has informed the Committee
that the central inspectors are carrying out inspections of only certain categories of items
– vaccines & sera. Large volume parenterals, notified medical devices, blood banks and
units applying for certificate of pharmaceutical products under WHO GMP Certification
Scheme. The Committee is surprised to note the role allotted to itself by the DCGI.
Though it has a supervisory responsibility over the entire range of drug manufacturing
units, it has withdrawn itself from the inspection of the drug units, except on request.
Considering that it has jurisdiction over 10,000 manufacturing units, the above table
reveals that a paltry number of manufacturing units were inspected. Given that in year
2007-08, the year in which the licenses of the public vaccine units were suspended, the
central inspectors only carried out 889 inspections, it is remarkable that the regulatory
authority found it possible to spare so much attention for the three public sector vaccine
manufacturing units.
4. Committee’s Observations on the Process Followed
4.1. As has been mentioned in passing in an earlier part of the Report, the process followed in
the Ministry in the course of decision-making on this issue, can only be called
unsystematic. In a public administration system, the fundamental principles of good
governance require that the record keeping of the decision-making process be clear. Only
then is transparency ensured in the process of governance, and only then is minimal
accountability achieved, as is required in governance.From the discussion of the process
adopted in this matter as analysed in the previous section of the Report, minimum
standards in this regard have not been maintained in the Ministry. If that had been
ensured, a plain reading of the file would have enabled one to understand the reasoning,
and ascertain the responsibility for the decision taken. The Committee observes that in
the matter under review here, it became necessary for it to carry out a mini-archival
research in order to determine even the sequence of events, not to talk of the rationale or
analysis of the issue involved. In this backdrop, the Committee is constrained to observe
that the Ministry of Health and Family Welfare had not maintained minimal secretariat
standards in the process of decision-making on the issue under review.
4.2. The relevant points that need to be analyzed before taking a decision on the closure of the
units, have not been explicitly stated anywhere in the Ministry’s notes. Looking at the
issues ab initio, the Committee is of the considered view that the following aspects
should have been considered in the course of taking a decision in the matter.
(i) Issues Relating to WHO
What is WHO’s role vis-à-vis that of the NRA in the matter of regulation of the
GMP standards for drugs and pharmaceutical units? Does WHO have a
supervisory jurisdiction over the Indian NRA to derecognize the NRA? Has the
WHO spelt out its position explicitly at any stage in regard to the GMP
compliance of Indian manufacturing units? Whey did the Ministry not take up
the issue with the DG, WHO, even though at several points in the notes, this line
of action was suggested?
(ii) Scope of Indian GMP Norms
Are Indian vaccine/sera manufacturing units required to conform to Schedule M
of the D&C Rules, or to the GMP norms of WHO? Does Schedule M of the
D&C Rules mandatorily require that the vaccine units ensure that the production
is strictly in uniflo and with a logical sequence of operations?
(iii) Exercise of Due Diligence by the Officials dealing with the Issue
Whether the dealing officials attempt to examine the various relevant aspects to
enable them to arrive at a decision in public interest? Whether the final decision
was on the basis of a reasoned analysis?
(iv) Purpose of notifying GMP standards
What is the fundamental purpose of statutorily notifying GMP standards for
drugs and vaccine/sera? Does a more stringent GMP standard necessarily ensure
a better product quality for the user? Has the Indian user of vaccines under the
UIP suffered in any way, whether in the long term or short term, by using
vaccines produced in public sector units that conformed to Indian GMP
standards rather than WHO GMP standards?
(v) Role of DGHS has the technical wing of the Ministry of Health and Family
Welfare the Directorate General of Health Services – adequately discharged its
role in advising the Ministry on this sensitive public health issue? Did the
Ministry involve the DGHS adequately?
(vi) National Health Security: Impact of the sudden closure of the units on the
Health Security of the country.
(vii) Evaluation of Public Interest: Was a comparison of the pros and cons of the
issue from the viewpoint of broad public interest carried out with due diligence?
4.3. A scrutiny of the records of the Ministry reveals that there was no systematic
identification of the issues and subsequent logical analysis of each of these aspects. Much
of the discussion on the files is extremely confused. There is some passing mention of
certain aspects, but these relate to the consequences if WHO de-recognizes the NRA.
Repeatedly, emphasis has been focused on the line that, if the NRA is derecognized, the
private manufacturers will be treated as ineligible for WHO pre-qualification as vendors.
The risk or damage to public interest resulting from closure of the public sector units has
never been considered; though, on a few occasions mention has been made that steps will
have to be taken to secure alternate sources of supplies for vaccines. In sum, it is the view
of the Committee that the Ministry (including the DGHS and the DCGI) did not carry out
a appropriately structured analysis of the sensitive issue under review. The discharge of
the responsibility of due diligence by the Ministry required that the various facets of the
issue be discussed in a simple structured manner so that the pros and cons were
transparent. The Committee is of the considered view that had this been done, the
Ministry would not have come to a decision to close the units in an abrupt manner.
4.4. The Committee will now record its perceptions, ad seriatim, on the various facts of the
issue of closure that have been listed in para 4.2 above.
4.4.1 Issues Relating to WHO
4.4.1.1 WHO is a highly regarded international organization in the Global Health Sector, India’s
association with it goes back to the time of independence. In the early years after our
independence, India was critically short of both financial resources and technical
expertise in the health sector. In those day, WHO’s assistance – both financial and
technical – went a long way in meeting the minimal requirement of health services in the
country. Over the years, both the financial resources available to the national health
sector and the local skilled human resources, have grown manifold. Though it is clear that
we are still a resource-deficit, developing country, the domestic resources are much more
now than what WHO can possibly provide by way of assistance. WHO has over the years
been hard-pressed for budgetary resources. Most of its budget is used for paying its
technical man-power. The annual allocation for the various field programmes funded by
WHO in India, would only be of the order of about Rs. 50 crores. As against this the
central government budget is itself of the order of Rs. 25,000 crores, while the state
budgets aggregate about Rs. 60,000 crores a year. Looking to these numbers, it is clear
that WHO’s contribution to service delivery in the health sector of India is miniscule.
However, there is still much that India can gain through an active association with the
initiatives undertaken by WHO. WHO is very influential in crafting the major policy
trends in the global health sector. Indeed, it is one of the few international organizations
that are not totally dominated by the developed countries of the first world. In the recent
past, WHO played a significant role in the Doha round of the IPR negotiations conducted
under the auspices of WTO. All of us in the developing world owe it a debt of gratitude
for influencing the trend of those negotiations, so as to provide comfort-space to
struggling countries to gain relief from some of the rigid IPR provisions, in the
eventuality of a national health emergency. All in all, it is the view of the Committee that
if it is very much in the interest of India to maintain a close working relationship with the
WHO to strengthen the voice of the developing countries in the global health sector. The
particular areas where the influence of this international organization could be of use to a
country like India are: setting normative commercial terms for pharma research:
prioritization of pharma research in neglected tropical diseases, sponsoring of pharma
research in the public domain to avoid patent restrictions advice in adoption of best
practices in health service delivery in different settings; etc. Given this backdrop, the
Committee is well aware of the valuable services provided by WHO, and has kept this in
mind while discussing in the next para the appropriate bi-lateral relationship between the
national government and the international agency.
4.4.1.2 As has been mentioned in the previous paragraph, the advice/information offered by
WHO-about improvement in product standards and technical processes, advancement in
treatment regimens and new diagnostics – is of immense value. However, in order to
maintain a harmonious working relationship, it is important to accurately demarcate the
boundary between the reach of WHO’s advocacy and the irreducible extent of exercise of
sovereign authority by the Indian government. It is known that the WHO has been
offering technical advice to the Ministry of Health and Family Welfare on GMP related
issues. However, no matter how useful WHO’s advice may be, the NRA’s sovereign
function under statute, of inspecting the manufacturing standards of drugs and
pharmaceutical units, cannot be discharged in partnership with international organization.
Under the D&C Act and Rules, the DCGI is the apex point of the Indian regulatory
system. This was the position taken by the government in year 2002 when it denied WHO
the permission to conduct inspections jointly with the NRA. The Committee recognizes
that it is within the competence of the Ministry to review a policy decision at a
subsequent point of time. Changing circumstances and national and international
developments, may necessitate that in the country’s interest. But the Committee is of the
view that any change in position of the government on a sensitive matter should be
agreed out in the notes in any analytical manner. It is seen that the decision taken by
HFM on 10.5.07, to permit WHO inspectors to be associated with the NRA inspection, is
on an opaque note stating that Secy. (HFW) has opined that we should not object to the
participation of WHO representatives in the NRA inspection. The note does mention that
in the past the Ministry has not agreed to this request from WHO. However, there is just
no analytical discussion as to why we should reverse the earlier position of the
government. This being a sensitive issue, the reasoning for the decision should have been
recorded explicitly. Once WHO came to be associated with the NRA inspection, their
view on the GMP standards became the dominant one. In this background, the committee
is of the view that the decision to permit WHO to join the NRA inspection was not taken
with the necessary degree of application of mind and accountability.
4.4.1.3 The Committee is aware that the WHO renders certain consultancy services by way of
procurement of drugs and pharmaceuticals for use in international programmes funded by
other multilateral agencies (UNICEF, WB, UNHCR). In the discharge of this function,
WHO can prescribe any norm considered appropriate in its judgment for pre-qualification
of vendors for supply of drugs and pharmaceuticals for the international programmes, so
long as its norms are not arbitrary. The functioning of the NRA has no nexus with any
inspection WHO may carry out on behalf of the international drugs/vaccine purchasers.
Independent inspection of the quality of manufacturing facilities is a common feature in
international trade a large number of countries proposing to import drugs and vaccines
from India routinely conduct independent inspection of the facilities of the vendors.
DCGI has also informed the Committee that WHO is periodically and independently
inspecting the private units in the country that are on WHO’s pre-qualified list of
vendors. However, the assertion which seems to have been made by WHO – that if WHO
was not permitted to inspect public sector manufacturing units (even if these had no
intention of applying for WHO’s pre-qualified vendor’s list), this would result in the de-
recognition of the Indian NRA, and would consequently render the private vaccine units
ineligible for listing on WHO’s pre-qualified vendor list – seems to be an arbitrary
conclusion. On the basis of what has been mentioned earlier, it is apparent to the
Committee that WHO does not exercise any supervisory authority over the Indian NRA.
Hence the question of de-recognition of the Indian NRA cannot arise. WHO would
naturally be entitled to make an independent assessment of the level of cGMP
compliance of those manufacturing units that apply for pre-qualified vendor listing with
WHO. Needless to say, the NRA in India can take a differing view on the status of
compliance for the very same units for its own purposes. However, it is the considered
view of the Committee that the eligibility of individual applicants should in no
circumstances be contingent upon whether public sector manufacturing units have been
inspected by WHO, or whether these public sector manufacturing units in the assessment
of WHO, meet its cGMP standards. Treating the eligibility of individual applicants as
contingent upon public sector units meeting eligibility standards, would clearly be
arbitrary.
Incidentally, it may be motioned that, after the view expressed in the above paragraph
had been incorporated in the interim Report, the issue of de-recognition of the NRA by
WHO seems to have been dropped and the Indian suppliers of vaccines to international
agencies have suffered no disadvantage.
4.4.1.4 The Committee is of the view that there is considerable confusion in the dialogue
between the Ministry of Health and Family Welfare and the WHO on the issue relating to
the GMP standards required to be achieved by public sector vaccine units. The WHO has
to bring out is position explicitly in writing at any time. The only mention of their
position is in passing notes of different Indian officials. These notes mention that WHO
has been insisting that, if India does not permit the inspection of public sector
manufacturing units, WHO will de-recognize the Indian NRA. Also, that if the Indian
NRA is de-recognized, no unit, including private units that otherwise are compliant with
the WHO GMP norms, will be eligible for listing as WHO’s pre-qualified vendors. The
only communication on record on this subject is a letter dated 17.5.06 addressed to the
HFM from the Additional Director General, WHO. This letter does not state that WHO
will de-recognize the Indian NRA if it is not allowed to inspect the public sector
manufacturing units, or if in their assessment the public sector manufacturing units are
seen to be non-compliant with WHO GMP norms. Clearly, the context of this letter only
relates to the requirements of eligibility for pre-qualified listing as vendors for purchase
relating to international programmes. The letter, however, does assert the view of WHO,
that India has followed dual GMP standards for vaccines with comparatively weak
enforcement of GMP for public sector units. By way of a caution, the letter does say that
there may be a major negative impact should the NRA assessment fail to meet the critical
indicators required for the WHO pre-qualification scheme. The Committee is of the view
that as a matter of administrative practice, in the normal course, the Ministry should have
obtained the position of WHO on this sensitive issue in explicit terms in writing. It is
considered to be imprudent for the Ministry to arrive at a decision on this important issue
merely on the basis of impressions and conjecture of some officials in the Indian
administration.
4.4.1.5 The Committee observes that in several notes on file, officials have suggested that the
issues be taken up at the level of DG, WHO so that the position of the Indian government
can be effectively put across. The specific suggestions for taking up the issue with DG,
WHO were made in the following listed notes; (i) JS (DP)’s note dated 31.10.07 in
Annexure C; (ii) AS (DG)’s note dated 28.11.07 in Annexure E; (iii) JS (BKP)’s note
dated 1.12.07 in Annexure D; (iv) AS (DG)’s note dated 1.12.07 in Annexure D. and (v)
HFM’s meeting on 13.12.07 recorded in DCGI’s note dated 14.12.07 in Annexure C.
While no one disagreed with this line of action, the suggestion was never perused. This
Committee had also recommended in its Interim Report that the Ministry may consider
taking up the issue with the DG, WHO, as the differences appeared to be on account of a
misunderstanding between the Ministry of Health and Family Welfare and the WHO.
While four of the Committee’s recommendations made in the Interim Report have been
accepted by the government and implemented, this particular recommendation does not
seem to have caught the attention of the Ministry. Even at the cost of repetition, the
Committee would again suggest that the Ministry may consider entering into a candid
dialogue with the DG of WHO so that the country’s position is clearly understood by the
WHO, and no unnecessary misunderstanding persists between the two.
4.4.1.6 For the reasons given in the earlier paragraphs, the so called de-recognition of the Indian
NRA by WHO, should not affect the eligibility of private manufacturers who otherwise
meet the norms for enlistment on WHO’s pre-qualified list of vendors. The Committee is
of the considered view that any decision by the WHO to de-recognize the Indian NRA,
for reasons that have been discussed, would be an extraordinary action on the part of the
organization. Such a move on the part of WHO would have far reaching implications on
the integrity of statutory institutions in sovereign nations. The Committee feels that any
move to consider private vaccine manufacturers (who are otherwise complaint with
WHO GMP norms) as ineligible because the WHO finds certain public sector units non-
compliant, would be illogical, arbitrary and discriminatory, as this has no nexus with the
objective of purchasing high quality drugs/vaccines produced under the best possible
GMP standards.
4.4.1.7 Despite having arrived at the above position on the question of de-recognition, the
Committee considers it necessary to address the worst-case scenario, one in which, at
some distant date, when even those Indian manufacturers that are compliant with WHO-
level GMP norms, are not included in the pre-qualified list of vendors. India has been a
growing exporter of drugs/vaccines under internationally funded relief programmes.
Exports of drugs and vaccines from the country under such programmes are of a value of
about Rs. 500 crores annually i.e. US$ 0.1 billion. Even if we hypothetically assume that
these exports run the risk of being discontinued, the impact will be nominal, as the value
of these exports is miniscule compared to the aggregate national export earnings of about
US 180 billion annually. In the perception of the Committee, the export earnings
foregone, if such an eventuality arises, would be insignificant compared to the gain
through enhanced vaccine security for the country over the long run.
4.4.2. Span of Indian GMP Norms
4.4.2.1 The Indian GMP norms of drugs and pharmaceutical are notified under the D&C Act and
D&C Rules. Over the last decade or so, WHO has been advising and encouraging
countries to align their GMP standards with their model GMP norms. After detailed
consideration over several years, on 11.12.01, the new GMP standards for vaccines / sera
was notified for India through an entirely new Schedule ‘M’ under the D&C Rules,
which were substantially congruent with WHO’s recommended norms. The new
standards came into force with immediate effect for new units; however, the notification
provided for a grace period for the existing units to upgrade their facilities and eventually
came to effect from 1.7.05.
4.4.2.2 The extant national GMP standards for drug /vaccine manufacture are largely identical to
the cGMP standards recommended by the WHO. The standards, inter alia, applicable to
vaccine/sera manufacturing units are set out in Part I and Part 1 A of Schedule M of the
D&C Rules. A perusal of this Schedule Reveals that it covers a vast array of
specifications that collectively impact on the quality of the manufacturing process. By
their number, nature and span of application, all these standards cannot be met to the
fullest extent by every manufacturing facility. Many of the standards are spelt out in
descriptive language, and an assessment of compliance would depend on the subjective
perspective of the individual making the evaluation. Also, legal compliance does not
require that each of the norms be individually met to the fullest extent, but rather than, the
overall compliance of the various norms should be adequate. A shortcoming in some of
the non essential / minor areas – need for re-configuration of production line; need for
smooth surfaces and dust-free junctions, corners and door-frames; defects in the animal
house; need for amendment of SOPs and new documentation; calibration of equipment –
does not automatically call for the suspension / cancellation of the license. To legally
carry out operations in India, the drugs and pharmaceutical units are required to
substantially comply with the standards set out under Schedule M of the D&C Rules,
subject to the monitoring /assessment of the NRA/DCGI.
4.4.2.3 To appreciate the approach required to be adopted in the enforcement of the GMP
standards given in Schedule M, it would be necessary to review, in brief, the historical
backdrop in which the drug industry has operated in the country. As a developing
country, India can be considered reasonably strong in the drugs and vaccine/sera sectors.
In the sub sector of generic drugs, we have a global reputation for production of high
quality and inexpensive generics. The vaccine / sera manufacturing facilities heirlooms
that have come our way. Two of our public sector vaccine manufacturing units are over a
century old, while the third one is over sixty years old. All three units have, what can be
called, an unmatched corpus of experience in the area of manufacture of vaccine/sera.
Here it may be mentioned that manufacture of vaccine/sera is not only an application of
technology/science, but it is also a quasi-art. The technical manpower in these units over
time has acquired, what can be called, a unique experience in this line of activity. The
private sector manufacturers of vaccines/sera in the country are relatively recent entrants
and the experience they draw upon is largely through the technical staff of public sector
units who are either retirees, or have been poached from public sector units. The vaccine /
sera supplied by the public sector manufacturers rigorously meet product standards
notified under the D&C Act and Rules – these units have had an unblemished production
record.
4.4.2.4 The key provision under Schedule M setting out the GMP standards in the production
area is: ‘The production area shall be designed to allow the production preferably in uni-
flow and with logical sequence of operations. ‘This is an over arching provision that sets
the backdrop for the other more specific norms. The language of this provision puts it
beyond doubt that production in uni-flow and with logical sequence of operations’ is a
desirable goal, but not a rigid mandatory requirement.
4.4.2.5 The notification of the rigorous GMP standards does not imply that all manufacturing
facilities that do not meet the standards to the fullest extent would in one stroke have to
be shut down. However, throughout the process of consideration of the issue on the
records of the Ministry, and the Inspection Reports, the underlying assumption has been
that the attainment of ‘uni-flo- of the operations in an irreducible, mandatory requirement
of the GMP standards. This approach is misconceived. These GMP standards are the
ultimate standards towards which we aspire, and these would have to be achieved through
progressive stages. It is not the intention of the law-makers to abruptly enforce these
standards on all manufacturing units with immediate effect, regardless of other
circumstances. It needs to be recognized the sudden-death approach to the
implementation of the GMP standards (which may be newly notified and subjectively
assessed) would serve no public purpose, it would only bring about a crisis, as the
operations of a larger portion of the domestic drug sector would come to a halt. About
95% of the domestic drug production units are in the small-scale sector. It would take a
decade or more for the units in this sector to become GMP-compliant to the fullest extent.
Through a package of progressive incentives and administrative hand-holding, these drug
units would have to be induced to improve manufacturing conditions. Looking to the
magnitude of the task involved, it would be a considerable time before the manufacturing
conditions in drug units would be anywhere close to the notified GMP standards as
interpreted to the ultimate extent. The Regulatory Authority, in exercising its judgment in
allowing units with various levels of compliance to GMP standards, subject to a minimal
level of compliance, should take a variety of factors into account. These factors would
include: the present manufacturing conditions, a realistic time-line for upgradation of
manufacturing conditions; harm to public interest resulting from a sudden drop in drug /
vaccine / sera availability; capacity of the manufacturing units to rigorously maintain
statutory product standards with their current manufacturing practices; irreducible needs
of national health security, etc.
4.4.2.6 At this stage the Committee would like to react to the issue raised in the letter dated
17.5.06 addressed to the HFM by the Additional Director General of WHO. This letter,
inter alia, makes the assertion that India is adopting dual vaccine standards in the matter
of vaccine supply with inferior quality products from the public sector units being used
under the UIP. The Committee has examined this issue very carefully and has come to
the conclusion that this perception is misconceived as it is not based on any acceptable
evidence. Different manufacturing units may have varying standards of GMP within a
range and yet all may meet the minimum compliance level of Schedule M acceptable to
the NRA. Vaccine/Sera manufactured in Indian public sector units are compliant with the
Indian GMP standard, and are also compliant with the notified product standard. Former
HFM, when he met the Committee on 13.5.10, also made a point in passing that supply of
vaccines from public sector units under UIP, would imply the use of inferior vaccines.
For the reasons spelt out in this para, in view of the Committee, such an apprehension is
unfounded.
4.4.2.7 A perusal of the three files relating to the issue of suspension of the licenses of the public
sector manufacturing units reveals that the examination has been carried out under an
impression that WHO exercises some type of supervisory jurisdiction over the Indian
NRA. Consequently, the entire examination process has borne the burden of the belief
that the conclusions of the inspection have to be agreed joint conclusions of WHO and
the NRA. As has been shown in the previous section of the report, the WHO inspection,
whenever it is carried out, would be only for the purpose of listing manufacturing units as
pre-qualified vendors, and the independent inspection of the NRA, under the authority of
the D&C Rules, would be to determine compliance with Indian GMP standards.
4.4.2.8 In the three files where the issue of suspension of the license was considered, great
emphasis has been given to the fact that the arrangement of the production line does not
conform to the principle of ‘uniflo’ and with logical sequence of operations… The
impression given on file is that non-compliance with complete ‘uniflo’ would constitute a
fatal deficiency in the observance of GMP standards in the production unit. To arrive at a
finding on the reasonableness of the above issue, the Committee considers it necessary to
discuss in some detail the significant provisions of Schedule M that are applicable to
vaccine/sera manufacturing units in the country.
4.4.2.9 The GMP standards are laid out in an elaborate document, a part of which is descriptive
in nature. The key overarching provision of Schedule M is: The production area shall be
designed to allow the production preferably in uniflo and with logical sequence of
operations.’ The manufacturing standards in the drugs and pharmaceutical industries of
the country are far-removed from the best in the world. However, the Committee must
quickly qualify this by saying that, this is not to imply that they are an unacceptable
standard that place at risk the health of the citizenry. The optimal flow of operations can
be ensured by strict application of appropriate SOPs without any major redesign of the
lay-out of the production line / buildings. It is the view of the Committee that, broadly
speaking, they maintained the minimum required technical standard, and in tandem with
rigorous enforcement of product quality standards, they have been able to provide quality
preventive / curative care to the citizenry.
4.4.2.10 The Committee visited the three manufacturing units before the finalization of the Interim
Report. The status of the manufacturing facilities at each of the three locations at the time
of the Committee’s visit has been given in paras 2.2, 2.3 &2.4 of the Interim Report. A
summary of the overview of the status of the three units is recapitulated hereafter. It is
noted that several inspection reports have been submitted pursuant to various inspections.
Many of the observations overlap. The last detailed inspection report was submitted in
early January 2008, after the receipt of the reply from the units to the show cause notice,
and immediately prior to the suspension of the manufacturing licenses. These are perhaps
the most detailed reports pointing out the deficiencies. The deficiencies listed in these
reports of January 2008, will be used as the reference list for the discussion in this
section. Out of the total of 140 deficiencies mentioned in the reports, some 71
observations are of a minor nature, not significantly affecting the manufacturing
standards. Some 69 others require significant improvement / upgradation – walls not
having a smooth surface, junctions, corners, window/door frames not being smooth and
dust free, animal house requiring minor improvement, SOPs requiring revision, need for
introduction of new documentation, need for calibration of different equipment,
separation of different work areas, etc. About 60% of this second category of work had
already been completed at the time of the site visit. It was the assessment of the
Committee that the remaining work in this category could comfortably be completed
within three months. On the basis of the observations during its site visit, the Committee
was of the view that many of the deficiencies pointed out are minor in nature, and even
the key requirement – ‘production in uni-flow and logical sequence of operations’ – is
substantially achieved in the existing production lines.
4.4.2.11 At this stage, the Committee would like to set out its understating of the key phrase of the
GMP, which constitutes the overarching objective, to design the work area ‘to allow the
production preferably in uni-flo and with logical sequence of operations.’ In the view of
the Committee, the key word in the provision is ‘preferably’. Quite obviously this word
was used to imply that the principle of logical sequence of operations would be enforced
to the extent it is possible to optimize the working, in the circumstances in which the
manufacturing units operate. It would be inherent in the situation that the rigour of the
application of the GMP standards would be greater for new units than for existing units.
The rate of progressive tightening of the compliance to the GMP norms would be judged
by the NRA in the totality of the circumstances. The facilities existing at the time of
suspension of operations were designed in an age when the idea encapsulated in the
phrase quoted at the start of the paragraph, was non-existent. However, the given
space/plot constraints at the three locations. It was noted by the Committee that much has
been achieved by way of rationalization of the flow of men and material in the
manufacturing process. In fact, in all the units, within each section of the manufacturing
process (receipt of raw material and glassware from outside suppliers, sterilization of the
items; culturing of bacteria, preparation of media; filling of vials; capping and labeling of
vials, packaging of the product) the layout and the manufacturing sequence has been
optimized. It can safely be claimed that within each section of the manufacturing line,
production ‘in uni-flo and with logical sequence of operations’ has been achieved.
Efficient flow of operations can be ensured by strictly following the SOPs, without major
changes in the building design. However, this had not been possible across all the
interfaces of the different sections in the sequence of production. The connect between
different sections of the production process in some instances is established through the
use of aseptic pass-boxes. To achieve the ultimate optimization through the entire process
line, a new production line will have to be established by incorporating the essential
technical features in the original design. It is learnt that the Ministry has approved the
schemes for establishment of new manufacturing lines. Taking into account the
reasonable estimates of time for administrative processing of the scheme and construction
of the new facilities, the Committee felt that a total implementation period of three years
would be required.
4.4.2.12 The manufacturing units at CRI, Kasauli and BCGVL, Guindy had considerably
quantities of finished products with them from the time of the closure. The Committee in
its Interim Report recommended that these should not be wasted and should be used to
bridge the supply gap at least in year 2010-11. In this backdrop, the Committee
recommended that the manufacturing units be advised that, after confirming the quality
of the products, these products be supplied under the UIP before their expiry dates. This
recommendation has been accepted and implemented by the government.
4.4.3. Due Diligence in Examination of Issues
4.4.3.1 A fundamental principle of Governance is that in the process of decision-making, the
examination of the relevant issues be carried out with due diligence, with due regard to
accountability and the need for safe-guarding public interest. Annexure C, D & E chart
out the route taken in the processing of the issue on the relevant files. The Committee
observes that not even one official has identified the different aspect of the issue and
analyzed it in any systematic manner. In fairness, it must be recorded that in his first note
dated 5.4.07. DCGI did, in a passing manner; spell out the likely impact of closure of the
public sector units on availability of vaccines for the UIP. However, this cannot be
treated as an adequate analysis of the various relevant aspects of the files the suggestions
were side-tracked and lost amongst other views. The overall impression that the
Committee gets is that the process of examination of the issue had spun out of control,
and no one at the senior administrative level made any attempt to bring it back on track.
The flawed decision was the result of multiple human errors. The constructive
responsibility for this would rest on the apex functionaries of the political and
bureaucratic executive i.e. HFM and Secy. (HFW).
4.4.3.2 Early during the process of examination of the issue, at the meeting taken by Secy.
(HFW) on 1.9.07, he had suggested that the units be advised to wind-down operations.
HFM, in a subsequent meeting had taken a milder view and instead suggested that the
units be asked to rectify the deficiencies pointed out and also that WHO Hqs be
approached for more time to carry out the upgradation. However, the Ministry’s final
views on the question of issue of a show cause notice dated 14.12.07 to the units was
approved by HFM. From this recapitulation of the process, it will be seen that the crunch-
decision taken by the DCGI, was accepted at the highest levels in both the political and
bureaucratic executive line-up of the Ministry. Responsibility for the flawed advice given
to the DCGI would substantially rest at those two levels – HFM and Secy (HFW).
4.4.3.3 From a study of the files it is seen that the representation made by the manufacturing
units against the notice of suspension / cancellation of the licenses and the reports of the
second round of inspection carried out under the orders of the DCGI, were never
examined on DCGI’s file: also at this stage, no reference was to the Ministry. The
Committee only finds a short note dated 16.1.08 (Annexure C), stating that the DCGI had
suspended the licenses on 15.1.08. This note was seen by DGHS (17.1.08) and Secy.
(HFW) (26.1.08).
4.4.3.4 The Committee is surprised to note the procedure adopted by the DCGI after the receipt
of the representations in response to the show cause notices. The action of the DCGI in
ordering the suspension of the licenses without even going through a ritual of considering
the representation, and the subsequent inspection report, is plainly illegal. Since the
DCGI was exercising quasi-judicial powers, an analysis of the representations and the
reasons for arriving at a decision, needed to be recorded as speaking orders. Since the
particular DCGI who was involved in the administrative process then, is no more with us
in the world, the Committee finds it appropriate to refrain from more critical comments
on this matter.
Before passing on to another section, the Committee would like to clarify one other
aspect. Despite the fact that the DCGI independently took the final decision to suspend
the licenses, without any consultation with the Ministry, there is ample collateral
evidence that the Ministry, including the apex levels of the political and bureaucratic
executives, were fully in the loop. In this background, the only conclusion we can arrive
at is that the Ministry was associated with the final decision for the closure of the units.
4.4.3.5 At this stage of the Final Report, the Committee would like to record the general
impression it has gained after studying the Ministry’s records relating to the
administrative processing of the issue. It is observed that the officials involved in the
process showed a marked reluctance to come to grips with the problem being examined.
The files floated around in a directionless manner. Most notes were perfunctory and
repetitive. The various elements constituting the issue have not been identified and there
is little rigorous analysis of the issues. A strong impression is gained that everyone was
handling the files with kid gloves. It would not be an exaggeration to say that the process
adopted in the Ministry – for evaluation of the issue relating to the closure of the units –
was virtually on auto-pilot. Quite apparently, the issue involved was a critical one and its
examination should have been carried out in all its multiple aspects. If, for any reasons,
the junior officers felt diffident, it fell upon the apex level officials of the political and
bureaucratic executive, to discharge this leadership role. There was nothing worn with
the ‘system’ in the Ministry / DGHS / DCGI, it was only that the ‘system was not
operated responsibly’ With disappointment, the Committee is constrained to note that at
no level was the duty – of ensuring a rigorous and objective analysis – discharged with
the necessary diligence. In fact, evidence on record indicates that, in the midst of the
administrative process, the decision was being treated as pre-judged.
4.4.3.6 The Former HFM in his meeting with the Committee on 13.5.10 made the point that the
consideration of this important issue was carried out for long, much of which went
unrecorded in the files. He implied that the question of adequacy of scrutiny in the
Ministry should not be based only on the recorded notes. The principle of accountability
on public administration requires that the process be fully recorded in the official
documents. It is not possible to entertain post-factor claims on the basis of unrecorded
discussions. Former HFM also contended that the Indian public sector units were in no
way comparable to the modern units Europe and USA. While this is true, as discussed in
another part of the report, this in no way contradicts a conclusion that the public sector
units broadly conform to the Indian GMP standards. In defending the closure of the
manufacturing units, the HFM had mentioned that during his period a large number of
units had been closed down in the country for non-compliance with the GMP standards.
For verifying this, the DCGI’s office was asked to provide information on the number of
units whose license was suspended / cancelled in the last five years for non-compliance
with the GMP standards. Despite several reminders, and despite the caution that failure to
furnish the information would only be construed as deliberate to avoid embarrassing
facts, these figures have not been furnished to the Committee. The general impression of
the knowledgeable officials in the Ministry is that this number would be very small, if not
nil. Thus, the former HFM’s impression about large-scale cancellation of licenses during
his period in office is mistaken. The Former HFM also has no comments as to why
WHOs views on the GMP standards should be binding in the Indian NRA. In totality,
during his meeting with the Committee, the former HFM did not mention a single point
of significance that could have improved the Ministry’s case in defending the handling of
this issue.
4.4.3.7 The note submitted by the DGHS does not raise any significant point. It generally says
that all matters were processed in DGHS/DCGI with all diligence and responsibility. The
only eye-catching opinion mentioned is that some issues listed in the note were purely
policy issues and DGHS had nothing to do with them. It comes as a surprise to us to hear
that the Director General does not consider it to be his role to advice the Ministry in
policy formulation. If this is really true, DGHS would be left with practically no
responsibility – it is well known that DGHS does not itself execute any field programme,
or deliver any health services. Policy issues in the Ministry of Health have a predominant
technical aspect, and one would expect it to be the principal responsibility of the DGHS
to provide the Ministry the requisite technical inputs. In fact, in the view of the
Committee, the issues being considered relating to implementation of GMP standards
were ones where the DGHS’ inputs would have been decisive in arriving at a policy
view-point. Without exaggeration, it can be said that the examination policy issue became
a mess, principally because there were no technical inputs to guide the analysis. In this
back-drop, the Committee is of the view that it would not be correct for the Director
General to assert that DGHS has no role in policy formulation.
The disagreement elements that should have been examined in the consideration of the
issue, have been discussed in para 4.2 of this Final Report. A perusal of the subsequent
paras would indicate that no rational analysis of these issues would lead one to the
conclusion that the vaccine units needed to be closed in public interest.
4.4.3.8 The Committee notes that another important point mentioned in DCGI’s note dated
16.1.08 relates to a meeting held on 17-18th Dec, 2007 between Secy. (HFW) and the
DCGI on the side of the Ministry and Additional Director General and his team from the
side of WHO. [In the Interim Report, the Ministry’s representatives had inadvertently
been mentioned as Secy. (HFW) and DGHS. DCGI has recorded that in this meeting
relating to the GMP standards of public sector units, the Ministry had agreed to suspend /
cancel the licenses of the public sector units by 15.1.08. Strangely, this note is nearly a
month after the event and also after the licenses had been suspended. There are no
minutes of that meeting on record to ascertain the circumstances in which that assurance
was given; it appears that no minutes were prepared and issued. This note of DCGI
records a startling development. There is nothing on record to show that the issue had
earlier been discussed at any level in the Ministry. Also, there is nothing to show that the
issue had earlier was given with the approval of HFM, or even that HFM came to know
of it post-facto. It may be mentioned that DGGI’s note dated 16.1.08 was not marked up
to HFM by Secy. (HFW).
4.4.3.9 The record does not explain under what circumstances and with whose authority, this
assurance was given. The show cause notice for suspension / cancellation of the license
was issued on 14.12.07. It seems that almost immediately after that Secy. (HFW) went to
Geneva, where he attended the meeting on 17-18th Dec 2007. Looking to these facts,
there is no gain saying that, even before the notice period was over and without taking the
unit’s representation into account, the assurance gave an unmistakable indication that the
outcome was pre-decided. A pre-judged outcome vitiates a quasi – judicial proceeding ab
initio. Noting the tenor of the notes, the route the files had taken and the issues which
were pointedly ignored, the Committee cannot avoid the perception that the conclusion
was pre-decided. The Committee considers it a matter of great regret that in examining
such a sensitive issues of public health security, the Ministry pre-judged the issue. In
view of this finding, regardless of all other considerations, DCGI’s order of suspension
dated 15.1.08 would have to be treated as null and void. Responsibility for the unilateral
assurance assuring closure of the units before 15.1.08, would rest on the apex functionary
of the bureaucratic executive i.e. Secy. (HFW)
4.4.3.10 Under the Rule 85(I) of the D&C Rules, the powers for suspension / cancellation of
licenses lie with the DCGI. The DCGI has the authority to exercise these powers
independently. However, there is no bar in law to the DCGI seeking advice / guidance
from anyone, including the Ministry of Health and Family Welfare. The issue regarding
the closure of the public sector vaccine units being such a sensitive one, it is not
surprising that the DCGI chose to seek the guidance of the Ministry of Health and Family
Welfare. Needless to say under the law the DCGI was in no way bound to accept the
advice of the Ministry. In the final sense, it was the DCGI who took the call on the issue
of the closure of the units. This issue has been raised in a separate note recorded by the
Member Secretary attached to the Interim Report. In this separate note, the Member
Secretary of the Committee has expressed the view that the DCGI is not required to
exercise his statutory powers for suspension / cancellation of licenses under instructions
of the Ministry. The Member Secretary had, therefore expressed the view that it would be
inappropriate to expect the Ministry of Health and Family Welfare to overtly interfere in
DCGI’s statutory powers. Thereby, the Member Secretary implied that the officials of the
Ministry of Health and Family Welfare cannot be said to be associated and would not be
responsible for the decisions taken by the DCGI. The other three Members of the
Committee consider it necessary to give their comments in this Final Report on the view
expressed by the Member Secretary.
4.4.3.11 It is the view of the other three Members of the Committee that, as mentioned earlier, it is
open to the DCGI to seek advice from anyone, including the Ministry before taking an
independent statutory decision. On receiving such a request, it was for the Ministry to
agree to give advice, or to instruct the DCGI to exercise his powers on his own. It is quite
clear from the record that the Ministry chose to evaluate the issue and finally offer its
observations to the DCGI. In fact, the Ministry processed this issue on its files from early
April 2007 to mid December 2007, a period of over eight months. In the background of
this history, and particularly after the decision of closure has generated considerable
public controversy, it would not be open to the Ministry officials to say that they are not
required to take a decision under the law and therefore they should not be held
responsible for the observations they offered to the DCGI. In the perception of the other
three Members of this Committee this would not be a bona fide position to take. In fact,
in our discussions in the Ministry, no official has taken such a position. In this backdrop,
the other three Members of the Committee would beg to disagree with the observations
made by the Member Secretary in his separate note attached to the Interim Report.
4.4.4. Purpose of Notifying GMP Standards
4.4.4.1 Any drug or vaccine/sera ultimately has to be judged by the product quality. All the
rigorous monitoring of GMP standards is to eventually secure product quality. The Indian
product standards are of a rigorous level, largely congruent with those recommended by
WHO. The products from the public sector vaccine / sera manufacturing units have not
come to adverse notice on ground of sub-standard quality. This record itself shows that,
despite not maintaining manufacturing standards that meet the ultimate level of
compliance of the GMP standards, the thoroughness of its procedures have ensured the
highest product quality.
4.4.4.2 The purpose of notifying GMP standards is to reduce, to an infinitesimal level,
the risk of any contamination / infection at any stage of the manufacturing process. It needs
to be recognized that conceptually, the risk of product quality failure can never be reduced
to zero; it can only be minimized to a low level. With the manufacturing processes in use in
the public sector units, and with diligence and thoroughness, they have ensured that the
product quality fully meets the notified standard. As has been mentioned in an earlier part
of the Report, the public sector units have already made considerable improvements/ are in
the process of making improvements in the manufacturing arrangements in order to rectify
the deficiencies that have been highlighted by the inspectors in their reports. To reach an
even higher level of sophistication in the standard of the manufacturing process, a new
production line will have to be established at each location, incorporating in the basic
design the fullest GMP requirements. However, till the new facilities are commissioned,
there does not seem to be any reason to discontinue producing the vaccines / sera in the
facilities available in their existing production line, which in some cases have been
significantly upgraded, and in others, are undergoing upgradation. While operating the
existing production line, the management will have to ensure that their product conforms to
the product standards prescribed in the D&C Rules in every respect. The Committee is of
the considered view that at the time of issue of the suspension orders, the public sector units
were substantially complying with the letter and substance of the GMP standards set under
Schedule M of the D&C Rules. The contrary assessment in the course of the inspections in
the latter half of 2007 was largely on account of a mis-interpretation of the statutory
requirements of the GMP standards, as discussed in an earlier section of the Report. In the
period after the closure, many of the deficiencies listed in the inspection reports have been
rectified, and action is underway to rectify the remaining deficiencies. Therefore, on
restarting after upgradation, the compliance level of the units would be superior to that
existing prior to closure.
4.4.4.3 With reference to the above paragraph, the Member Secretary of the Committee, at
the stage of finalization of this Final Report, has brought to our notice a Note of the
Standing Finance Committee circulated by the Ministry of Health and Family Welfare in
July, 1999 relating to the expenditure sanction for certain works of upgradation proposed in
the manufacturing facilities of CRI, Kasuali. The Member Secretary has pointed out that the
said Note admits that the manufacturing conditions in that unit are not cGMP compliant and
that the upgradation is required to make the unit compliant with Schedule ‘M’ under the
D&C Rules. From this, the Member – Secretary has drawn the conclusion that it cannot be
said as has been stated in the previous para, that at the time of suspension of the licenses of
the unit in January 2008, the unit was substantially in compliance with the extant GMP
standards. The substance of his point is placed in Annexure F to this Final Report as a Note
of Dissent. As suggested in that note, the Committee once again asked DGHS/DCGI to re-
check and forward any other files relating to the issue under examination that had escaped
their notice earlier on. No other documents have been located and forwarded by the
DGHS/DCGI. The other Members of the Committee have studied the available documents
and the surrounding circumstances referred to by the Member-Secretary, in great detail. The
observations of the other Members of the Committee are as under:-
(i) GMP norms were first introduced under the D&C Rules in 1988 and have been
changed from time to time. The GMP norms in force in December, 2007 when the
licenses of the manufacturing units was suspended, were first made effective from
1.7.05. The GMP norms in force when the SFC Note was circulated in July, 1999
were clearly not the norms under which the licenses of the manufacturing units were
suspended in January, 2008. Thus the statement in the SFC Note relates to another
norm at another time, and would have no bearing, legal or otherwise, on the status of
GMP compliance of the unit in January 2008.
(ii) Quite apart from the issue as to which norm was in operation when the SFC Note
was circulated, a long span of over eight years separated the circulation of the SFC
Note and the suspension of the license of the unit. Any regulatory action under the
D&C Act or Rules has to be based on proximate events. The observations on the
manufacturing conditions in year 1999 would have no rational nexus with the
manufacturing condition in early 2008. In the subsequent para 7 of this Report some
details have been given of the steps taken over the years to upgrade the quality of the
facilities in the manufacturing units. Annexure K to this Report sets out the annual
plan allocation over the last fifteen years for CRI, Kasauli. It will be observed there
from that between 1999-2000 (when the SFC Note was circulated) and 2007-08
(when the manufacturing license was suspended), the Plan Expenditure incurred at
CRI, Kasauli for various upgradation works was of the order of Rs. 43 crores. Given
these facts, it is clear that the condition of the manufacturing facility in year 2007-08
would be vastly different from that in year 1999-2000.
For the reasons given above, it is considered view of the other three members of the
Committee that a remark in a document of year 1999 – that CRI, Kasauli is not GMP
compliant – would have no logical bearing on the GMP status of the unit in the year
2007-08.
4.4.4.4 The impression given in some of the documents of WHO officials and also in the
media, is that, by not meeting WHO GMP standards, the users of these drugs / sera under
the UIP are being delivered sub-standard medical services. Such a perception is
misconceived. All the sera/vaccines produced in the country are produced from units
meeting Indian GMP standards. Also, all the products being introduced in the domestic
market are conforming to the notified Indian product standards, which in most cases are
congruent to the WHO recommended product standards. Conceptually, GMP standards can
be of an ever-increasing sophistication. The GMP standards maintained by some European
manufacturers are even superior to the WHO GMP standards. This in no way implies that
products from a unit complying with WHO recommended standards is inferior to that from
European from manufacturing units maintaining even more sophisticated standards.
Likewise, the products from units conforming to Indian GMP standards are in no way
inferior to the products from units conforming to WHO recommended standards. All
products released into the domestic market are rigorously checked for product quality
against the notified product standards, regardless of the GMP standards of the originating
manufacturing units. It is, of course, true that for manufacturing units having higher GMP
standards, the possibility of turning out batches of sub-standard products reduces. In any
case, all batches of bulk finished product and all lots of packaged drugs/vaccine/sera are
rigorously checked for product quality prior to release into the market. Looking at if from a
commonsensical point of view, no manufacturing unit that was noncompliant with the GMP
standards could possibly produce vaccines with the correct product standards on a
consistent basis over an extended period of time. Thus, the impression given in certain
circles that the products from unit conforming to Indian GMP standards are inferior to the
products from units conforming to WHO recommended standards, is baseless. The charge
that is sometimes made – that the Indian government is providing sub-standard vaccine /
sera to its citizens under the UIP – is unfounded assertion.
4.4.5. Role of DGHS
4.4.5.1 The Ministry of Health and Family Welfare is a key one in the national government.
The social sectors – health, education, social empowerment, etc. – impact directly on
individual citizens, an aspect that is vital for the socially disadvantaged. The production
sectors – industry, petroleum, minerals & metals, etc. – on the other hand impact on the
elite first and then to some extent, through the trickle-down effect to the disadvantaged. For
this reason the Ministry of Health and Family Welfare has a pivotal role in meeting the
basic human needs of the community in general. At one level, this poses a gigantic
challenge in public administration in reaching health services to the scattered population, at
another level, this sector with a high involvement of science and technology, which requires
the inherent capacity within the management structure to incorporate these technical inputs
into public health policy. If one looks back at the last half century, the sectors in which
science and technology has taken huge strides would include IT, Military Weaponry and the
conquest of space, along with the medical sector. For the Ministry to discharge its role of
governance effectively, it would need strong advisory support of benefit from the
developments that are available through the application of science and technology. In the
Indian context, this advisory role is to be discharged by the Directorate General of Health
Services, a subordinate office of the Ministry. The Directorate is manned by some graduate
doctors, while most others are specialists. These technical personnel in the DGHS are
mandated to advise the Ministry on the many technical issues associated with any public
health intervention. The case of vaccine production is a text book example of an issue
where the contribution of the DGHS’s advise should have been decisive.
The Committee has studied the proceedings on the files under review to assess whether the
responsibility of DGHS (as distinct to the DCGI section) has been adequately discharged. A
scrutiny of Annexure C, D & E reveals that there has been almost no participation in the
decision making process at the senior level of the DGHS. That is the level from which the
Ministry can expect to obtain valuable and balanced advice. It is observed from Annexure
C that the file went to the Director General on three occasions and no substantive comment
was offered on any occasion – in fact, that level merely served as a pass-through level
between the DCGI and the Ministry. The Committee is constrained to express its
disappointment at this. From a perusal of the files it is obvious that the lower-level officials
in the DCGI’s office and the Ministry were floundering. In this situation one expected that
the highest functionary in the Directorate – the Director General – would assume the
leadership and set the file on a reasonable track fro rational examination of the issues.
However, no such proactive intervention was offered. It was left to a fairly junior officer in
the Directorate – the ADG(EPI) – in para 10 of his note dated 4.1.08 (Annexure E) to point
out that there was utter confusion over the closure issue in the manufacturing units and the
Ministry and to urge that a clear line of action be indicated. In fact, he was bold enough to
suggest that (i) the production in the three units be continued and (ii) the units undertake
rectification of the defects pointed out in the inspection reports. In response to this, as in the
past, no decision was taken at the higher level, whether in the affirmative or in the negative.
4.4.5.2 However, even more than what has been mentioned above, the Committee is pained
to read the remarks of the Director General in his note dated 9.1.08 (Annexure E). From
these it is clear that at the final stage, the Director General was completely out of the loop
of officials who were dealing with this important matter. In his note he says that he has
been told by DCGI that the decision to suspend the licenses is as per the provisions of the
Act and it was taken after getting approval of the highest authority. He also directed that the
photocopies of the relevant papers be obtained and placed on record. The Committee is
distressed to note the point to which the Director General had reduced his role in the
processing of this important matter. The record makes it apparent that, not only did the
Director General not contribute to the processing of this sensitive technical matter, but that
he was not even formally in the loop. What makes it worse is that even the information he
obtained from the DCGI was factually incorrect – the Director General’s note is dated
9.1.08 while the suspension order was issued on 15.1.08 about a week later. Also, in point
to fact the final decision to suspend the license was not taken by the highest authority
(meaning HFM) but was independently taken by the DCGI. These records provide
additional evidence that the eventual conclusion to close the units – was a pre-determined
one. Also the Director General was completely out of the decision-making loop.
The Committee is of the view that the Director General, in the processing of these issues,
has adopted a very passive role. His interpretation of his role is that he is not required to
participate in policy-making. In fact in the note submitted by him to the Committee
(Annexure B), he explicitly states that all the issues being looked into were policy issues
and the DGHS has nothing to do with them. The Committee strongly recommends that the
Directorate and the Director General should proactively involve themselves in policy-
making. Also the Ministry should be anxious to elicit the technical inputs from the
Directorate.
An overview of the entire record leads the Committee to the conclusion that, though the
lower level of the DGHS’s office may have failed to put the issue in its correct perspective,
at least they participated in some manner in the process of decision-making. However, the
Committee is constrained to note that the higher levels of the Directorate of Health Services
did not discharge their responsibility as the apex technical advisors to the Ministry. The
Committee also notes with regret that the fact that no useful technical inputs were emerging
from the DGHS was accepted in the Ministry without demur and othing was demanded
from the DGHS.
Before closing this section of the Report, the Committee thinks it appropriate to give its
views on one general point. In the course of the inquiry, the Committee perused many files
others than those that were found to be relevant to the inquiry and which came to be
analysed in the Report. A perusal of a large number of such documents gave the Committee
an impression that, for various reasons, the powers statutorily delegated to different levels
of the hierarchy were not being adequately utilized in an independent manner by the
concerned functionaries. The Committee would urge that all officials entrusted delegated
powers should be required to exercise these powers independently in the interest of
expeditions decision-making in public interest.
4.4.6. National Health Security
4.4.6.1 One of the primary responsibilities of governance is that of ensuring public health
security. An, in sum, one irreducible element of public health security is the securing of
vaccines for the UIP. Despite all attempts to moderate the population increase, there is no
escape from the position that in the next decade or so we will have to provide for about 25
million new born/ infants every year. The infants in our country many of who are
undernourished and underweight are markedly vulnerable to communicable diseases. In
their weakened condition, without immunization cover, they become sitting targets to the
common infections. Out of the current level of infant mortality of 53 per 1000 live births,
37 deaths are contributed by neo-natal mortality i.e. 68%. Exposure of infants, even if they
survive an attach of a communicable disease, leaves them weak and handicapped for life,
for ever prone to recurring morbidity. It is also noticeable that despite considerable
improvement in the basic health indicators since independence, the levels are still
unacceptable. The coverage under UIP as reported by NFHS 3 is only 44% and has actually
worsened since NFHS 2 in several states – Andhra Pradesh, Gujarat, Maharashtra, Punjab
and Tamil Nadu. The scope for the gainful use of the UIP for moderating infant morbidity /
mortality is still large. In these circumstances, ordinary prudence demands that the sources
of supply be divided between the public and private sector producers, so that the possibility
of disruption of the supplies on account of an unforeseen crisis in commercial production is
minimized. Annexure F clearly indicates that in the year previous to the year of closure of
the public sector units (i.e. 2006-07) the contribution of the six primary vaccines to the UIP
from the public sector producers was substantial. The Committee observes that, by
reducing public sector vaccine supply to zero in one stroke a crippling blow has been
inflicted to the health security of the country.
4.4.6.2 The importance of vaccine security in the country has also been highlighted in the
National Health Policy – 2002. In order to ensure uninterrupted supply of vaccine/sera for
the UIP at affordable prices, the National Health Policy recommended that not less than
50% of the vaccine / sera be sourced from public sector institutions. For historical reasons
we were in the happy position of substantially meeting these targets prior to the closure of
the public sector manufacturing units. For the consideration of their imperial power, the
British had set up the vaccine manufacturing units. These were operated by Indians who
thereby acquired a unique experience in this vital sector. There are very few other
developing countries that occupy such a position of strength. Casting our attention across
our neighbor countries – Bhutan, Nepal, Pakistan, Myanmar, Sri Lanka, Bangladesh – none
of these have any experience in this sector of production. With our fortuitous head start, we
are in a unique position to consolidate our vaccine security. Also with our low cost of
production and excellent product quality standards, we are in an advantageous position to
become the preferred source of vaccine supplies to the countries of the developing world. In
this backdrop, the Committee is of the view that the country should try to consolidate its
historical advantage rather than becoming wholly dependent on uncertain private
commercial sources.
4.4.6.3 At the time of ordering the closure of the public sector vaccine manufacturing units, the
Ministry had announced the proposal to set up a new Integrated Vaccine Complex at
Chengallapattu, Tamil Nadu. The estimated project cost was in the range of Rs. 160-200
crores. The facilities planned to be covered in the complex were:
Table 7
UIP Vaccines DPT,TT,DT,DCG & MeaslesCommon Facilities Vaccine R&D, Testing Labs, Animal House,
Incubators New Generation Vaccines Hep. A&B, Hib., JE, ARV., Com Vac.
The project is at an early stage of planning. The responsibility of coordination of the
project has been entrusted to HLL Lifecare Ltd., a public sector undertaking under the
Ministry of Health and Family Welfare. In the Committee’s assessment, even after the
integrated complex is provided its full requirement of funds in the implementation period,
the completion will take not less than three years.
4.4.6.4 At this stage we find it necessary to inject an element of realism in the estimation the
implementation schedule of the new integrated complex. Project implementation in the
public sector is painfully slow. In the case of the Integrated Vaccine Complex new
technology would have to be negotiated, which would have its own time requirements.
Also, the establishment of the new production lines at the three locations would take not
less than three years. In this backdrop, the Committee can see no reason for closing down
the existing plants in the public sector when the new integrated vaccine complex, or the
new production lines at the existing locations are nowhere on the horizon. By closing
down the existing public sector vaccine production units in advance, the country would
have exposed itself to vaccine insecurity for five years, or possibly, even a longer period.
However, the establishment of the new integrated vaccine complex, along with the
establishment of new production lines at the existing three locations, will eventually
greatly reinforce the nation’s vaccine security.
4.4.7. Evaluation of Public Interest
4.4.7.1 After discussing the important elements having a bearing on the issue of closure of
the manufacturing units, the Committee would now like to gather the strands of the
discussion to come to a conclusion on the main item of the terms of reference. The first
item of the terms of the reference reads as under:
“To review the reasons for suspension of the manufacturing licenses of the three
institutes, namely Central Research Institute, Kasauli, Pasteur Institute of India,
Connoor, and BCG Vaccine Laboratory, Guindy, Chennai from the historical,
technological administrative/organizational and other perspective.
4.4.7.2 The process of examining the issue of closure has been carried out in the Ministry
under an over-hanging impression that the WHO exercises some degree of supervisory
control over the Indian NRA. The discussion in para 4.4.1.2. in the view of the Committee,
establishes conclusively that this not is not true. WHO’s role in India is an advisory role.
The international organization can set its own standards for drawing up the pre-qualified list
of vendors for supplies it makes to multi-lateral agencies. However, the role of enforcing
Indian GMP standards in the domestic manufacturing units is independently discharged by
the NRA/DCGI. The NRA is required to see whether in their entirety, the standards set out
under Schedule M of the D&C Rules are substantially met by the unit. Each norm, or
aspect, does not necessarily have to be fully met to achieve compliance with the GMP
standards. The NRA is required to satisfy itself that overall the unit meets the irreducible
acceptable level of compliance. Neither the letter of the provisions under Schedule M nor
the historical background of the manufacturing sector in India would lead to the conclusion
that the overarching principle applicable – the manufacturing facility being in ‘uniflo’ and
in logical sequence of operations – is required to be met to the fullest possible extent. The
compliance with the norms has to be judged by the NRA in the context of a variety of
circumstances, including the technology level of the unit, the design of the existing unit, the
scope of change looking to the physical lay-out of the unit, consideration of the health
security of the country, etc.
4.4.7.3 In the context of the above stated legal position, the Ministry should have carried out
an evaluation process to come to a decision on the issue of closure of the units. The
Committee is of the considered view that the functionaries in the Ministry failed to
discharge this responsibility. The issue was processed in disregard of the legal position
outlined in para 4.4.7.2. Further, the issue was not logically disaggregated into its elements
in order to make the examination a meaningful one. The record shows that the process was
sent off in a futile circular motion, with the key issues never being examined. The apex
functionaries – of both the political and bureaucratic executives (HFM and Secy. (HFW) –
took no initiative to ensure that the examination was proceeding in a meaningful direction.
The DGHS, the principle technical advisory agency for the Ministry, made no contribution
to the understanding of the issue in the Ministry. Despite suggestions on more than one
occasion, no initiative was taken to resolve the issue at the level of DG, WHO. The
evidence also shows that the conclusion of the examination was pre-determined. Secy.
(HFW) had given an assurance on 17-18th Dec. 2007 to representatives of WHO that the
public sector units would be closed before 15.1.08. This was well before the notice period
for making a representation had expired, as also before the representations had been
received and studied by the DCGI. Responsibility for pre-judging the issue would rest on
Secy. (HFW).
4.4.7.4 All in all, the decision of the Ministry, both in legal terms and on consideration of
the merits, was palpably incorrect. Because the outcome of the evaluation process had been
pre-determined the entire process was null and void. On the other hand, on consideration of
the pros and cons from the view point of public interest, the decision was unjustified.
Despite applying the most liberal interpretation to the events, the Committee could not
uncover any rational reasons for the conclusion that was arrived at in the Ministry. The
decision of the Ministry left the country without any supply from the public sector, thus
exposing it to an unacceptable risk in vaccine security. As a result of total dependence on
private suppliers, the Ministry became captive to private commercial pressures. The price of
the domestic primary vaccines rose by 50%-70% in the two years after the closure of the
public sector units and several key states experienced critical shortages of the vaccines. In
view of this the Committee concludes that the palpably incorrect decision of the Ministry –
based on an illegal procedure and a flawed appreciation of the issues – was against broad
community interest.
4.4.7.5 Analysis of the data received from the Ministry and also the observations during the
visits to the manufacturing facilities had led the Committee to the conclusion that the post
closure situation was critical, for which reason some of the Committee’s recommendations
needed to be submitted to the government immediately. The Committee realized it would
take more time to study and arrive at its conclusions on the full span of the terms of
reference. In these circumstances, the Committee submitted an Interim Report dated 5th Feb
2010 with certain recommendations that required implementation without delay. As has
been mentioned in an earlier part of the Report, four significant recommendations from the
interim Report have already been implemented by the Ministry.
5. Impact of Closure on the UIP
5.1 At Annexure G is a statement giving the share of supply of different vaccine/sera from
different manufacturing units in the public and private sectors. It will be observed that in
the period 2004-05 to 2007-08 the supply of vaccines from public sector units as a
percentage of total national requirements has ranged as indicated in the following Table
7.
Table 7
BCG 100% TT 18%-100%Measles 0% DPT 34% - 90%
The above figures indicate that in the stated period, India has been able to maintain a very
balanced approach in operating the UIP by sourcing a significant portion of the primary
vaccines from the public sector units. From year 2008-09 onwards, the supply from
public sector manufacturing units has dropped to zero. To insulate the UIP from price and
supply shocks a cardinal principle of public health policy requires the sourcing of the
vaccines from public sector manufacturing units to a substantial extent.
5.2 The statement at Annexure H gives the installed manufacturing capacity in the public and
private sector units. The aggregate installed manufacturing capacity in the country is
much more than the country’s requirement. It will be observed that the public sector
share of the installed capacity is substantial (BCG – 62%; DPT 20%, DT-26%, TT –
53%). Based on this on the whole, the public sector production has made the public
health system entirely dependent on private suppliers.
5.3 The UIP coverage in year 2008-09 & 2009-10 the two years after the closure of the
public sector units, is given in Annexure I & J respectively. It will be seen that while
there was no shortage in aggregate availability in 2009-10 for most vaccines (DPT-
96.3%, OPV-95%, BCG – 90.5% and Measles – 92.4%) several key states with large
populations (>20 million) were handicapped because of short supply. The shortfall in
targeted UIP coverage (>10%) in 2009-10 was observed in the following key states with
large populations (>20 million).
Table 8
Vaccine States in which shortfall >10% of requirements BCG Bihar, Madhya Pradesh, JharkhandDPT Bihar, Assam, Jharkhand, Madhya PradeshOPV Assam, Bihar,Madhya Pradesh, Jharkhand, Karnataka
Measles Assam,Bihar,Jharkhand,Karnataka
5.4 The Ministry was able to draw down on the buffer stock, and it also made additional
purchases from the private manufacturers to meet the demand in 2008-09 and 2009-10.
However, the vulnerability of the public health system in the long term is plainly visible.
In year 2008-09 & 2009-10 when the public sector supply was nil, the price the Ministry
had to pay the private suppliers was unacceptably high – increase of price over the price
paid to the supplier in the previous year for the different vaccines was found to range as
under:
Table 9
Purchase Price of Vaccines from Public/Private Manufacturers in years 2007-08, 2008-09
& 2009-10
Vaccine Year 2007-08 Year 2008-09 % Increase
y-o-y
Year 2009-10 % increase
y-o-yPublic
Sector
Price Per
Vial
(Rs.)
Private
Sector Price
Per Vial
(Rs.)
Private
Sector
Units
Price
per Vial
(Rs.)
Private
Sector Uni
Price
per Vial
BCG 13.00 -- SII* 17.50 30 SII 27.85 59DPT 11.50 13.50 SIL*
BE#
14.37
16.89
6
25
SB
BE
23.49
23.59
63
40DT 9.60 9.14 BE# 13.85 52 -- -- --TT 6.20 -- -- -- -- -- -- --
*SIL Serum Institute of India : BE#: Biological Evans
5.5 While judging the availability of vaccines for the UIP, the aggregate national availability
is not as important as the availability in each state/union territory, which constitutes the
public health administrative units that actually deliver the health services. The inadequate
supply of vaccines to several large and critical states is a dangerous development. It
should be the highest priority of governance to ensure that this risk of vaccine shortage is
not carried forward into the future years.
6. Revocation of Suspension
6.1. The status of the manufacturing facilities at each of the three locations at the time of the
site visit has been given in summary form in paras 2.2., 2.3 & 2.4 of the Interim Report. Several
inspection reports have been submitted pursuant to various inspections. The deficiencies listed in
the reports of January 2008 will be used as the reference list for the discussion in this section. Out
of the total of 140 deficiencies raised in the report, about 71 observations are of a minor nature,
not significantly affecting the manufacturing standards. Some 69 others required significant
improvement or upgradation. About 60% of this second category of work has already been
completed. The remaining work in this category can comfortably be completed within three
months. Within the given space/plot constraints at the three locations much has been achieved by
way of rationalization of the flow of men and material in the course of the manufacturing process.
In fact, in all the units, within each section of the manufacturing process, the lay-out and the
manufacturing sequence has been optimized. Based on this status of the production lines, the
Committee had come to the conclusion that many of the deficiencies pointed out are minor in
nature and even the critical requirement – ‘production in uniflo and with logical sequence of
operations – has substantively been achieved in the existing production lines. In the above
circumstances and for the reasons discussed in detail in para 4.4.2.13. the Interim Report the
Committee had recommended that the production in the existing units be restarted at the earliest.
To enable that, the necessary orders would have to be issued in response to the appeals filed by the
affected units under Rule 85(3) of the D&C Rules. The Committee is happy to note that the
government accepted that recommendation and revoked the suspension orders on 26.2.2010.
6.2. The surviving deficiencies relate to overcharging objective of the GMP – to design the
work area ‘to allow the production preferably in uni-flo and with logical sequence of
operations’. In the view of the Committee the key word in the provision is ‘preferably’.
Quite obviously this word was used to imply that the principle of logical sequence of
operations would be enforced to the extent it is possible to optimize the working in the
circumstances in which the manufacturing units operate. This has not been possible in the
different sections of the production process of production units across all the interfaces
of the different units in the sequence of production .The connect between different
sections of the production process in some instances, under the current plant layout is
established through the use of aseptic pass-boxes. To achieve the ultimate optimization
through the entire production line, a new manufacturing line will have to be established
by incorporating the essential technical features in the original design. Taking into
account the reasonable estimates of time for administratively processing the scheme and
implementing the new facilities, the Committee feels that a total implementation period
of three years would be required and should be adhered to. A time-schedule for
preparation of plan, decision-making, release of grant and implementation should be
drawn up and followed.
7: Upgradation of Public Sector Vaccine/Sera Units
7.1 While recommending the immediate restart of the existing manufacturing facilities, the
Committee is distressed to observe the long-persisting delay in setting up the new production lines
to achieve the ultimate fulfillment of GMP standards. The year-wise budgetary plan allocation for
fifteen years (1905-96 to 2009-10) are given in Annexure K. From this it will be seen that, in the
more recent past, the budgetary plan allocations have been increased. Some of the piece-meal
improvements undertaken by PIL, Conoor were related to TCARV Lab., Measles Lab., DPT- Hep.
B Combo Lab. Diptheria Lab. Pertussis Lab, and Quality Control and Utilities. While the
upgradation in CRL Kasauli was of the Triple Vaccine Division. From this it is observed that the
improvement programme was fragmented. In the case of the third public sector unit - BCGVL.
Guindy - even the ad-hoc initiatives were not of a significant nature. From the above account it
will be seen that in two of the units - PIL. Conoor & CRL Kasauli - some efforts were made to
bring about ad-hoc improvements in the manufacturing units. However, the programmes and the
budgetary outlays were nowhere near the scale/amount required for radical redesigning of the
production lines. In the period being mentioned, the budgetary proposals from the Units/Ministry
were for larger programmes, but the allocations provided were limited by the macro-level resource
constraints of the Planning Commission/ Ministry of Finance. It may be added here that even after
the new GMP norms became effective from 1-7-05, government has been tardy in upgrading the
level of manufacturing facilities. In the budgets after the new GMP norms became effective 2006-
07 to 2009-10 the total plan allocation for the three public sectors manufacturing units has only
been about Rs. 64 crores. An amount that is grossly insufficient for setting up new production
lines. The Committee, however, notes that many of the deficiencies pointed out in the inspections
are minor ones and should have been rectified by a vigilant management within the financial
allocations made from time to time.
7.2 The Ministry of Health and Family Welfare has already decided to set up a new
production line at each location with the basic design across all sections of the manufacturing
process enabling production in uniflo and with logical sequence of operations to the fullest extent,'
Many such plans/resolves of the Ministry, in the past, have not been carried forward, and have
only petered out in time. The Committee strongly urges the Ministry to ensure that such a
denouement does not recur. It is no credit to a country aspiring to become a global power to be
exposed to controversy on a fundamental issue of vaccine security. Un fortunately, we have been
facing such a controversy over the last two years. As a basic human, need, health security should
be maintained and insulated from threats and controversies. For the next decade-and-a-half at
least, our requirement for primary vaccines will not reduce in quantum. As time goes by newer
vaccines may be included in the array of primary vaccines, and the UIP may acquire a new look,
even though the coverage may be for a reducing number of new-born. In short, for as long a
period as we can foresee the UIP will be a major component of governance in the health sector.
Looking over this span of the future scenario, it was imperative for the country to establish at the
earliest new manufacturing-lines at the three locations by incorporating in their basic design all the
critical elements of the GMP standards. The Committee, therefore, recommends that the
revocation of the suspension of the license of the units suggested in the previous para be made
subject to the condition that a new production line for manufacture of vaccine/sera will be set up at
the three locations within a period of three years.
In the course of the proceedings of the Committee, the Committee has been informed by the
officials of the Ministry that formal approval has been given to the three units to proceed with the
implementation of new production lines at their current locations. The Committee would reiterate
its earlier observation that the projects would require very close monitoring to be completed in the
estimated project period of three years.
7.3 The organizational and staffing issues relating to the setting up of new production lines
have been discussed in considerable detail in Section 9 of the Interim Report. The Committee does
not propose to repeal this in the Final Report. However, the Committee finds it necessary to bring
to the Government's attention that, unless concerted and sustained efforts are made to set up new
manufacturing units with modern technology, the vaccine security scenario will be repeatedly
exposed to turbulent phases, similar to those we have experienced in the last two years. To attract
and retain experienced vaccine technologists/scientists who are in short supply in the market, the
Committee recommends that the pay scales applicable to the, scientific cadres be made applicable
to them. For project formulation/execution the government may engage on contract specialist
consultants of global repute at globally accepted compensation packages.
8 Organisational Restructuring
8.1 The Committee has observed that one crucial underlying cause for the malfunctioning of
the manufacturing units is the unsuitable organizational structure they are frozen in. Because of a
historical handicap the public sector vaccine/sera units have an organizational structure that
belongs to a past age - CRI. Kasauli and BCGVL. Guindy are still departmental undertakings:
while PIL. Conoor is a registered society. The Committee is unable to understand what purpose is
served in this day and age by keeping CRI. Kasauli and BCGVL, Guindy bound down as
departmental undertakings. These two undertakings are narrow-band, high-tech units. Most of the
officials and technical staff have specialist skills only in the line of manufacture of the limited
items produced there. Not many of them can be interchanged even within the three units under
review here. It is near impossible to find an official in the Directorate who could assist a
manufacturing unit in a technical problem relating to the manufacture of vaccines/sera. In a
previous part of the Report we have seen how the crisis situation in the three units was handled at
the highest level of the Directorate. It is unrealistic to expect results from these units when they
are tied down to the Directorate. The Committee would suggest that these units be made
Autonomous at the earliest, by registering them as a non-profit company under Section 25 of the
Companies Act, 1956 or under the Societies Registration Act, 1860. Since the units are fully
funded by the government, the government would, no doubt, like to assure itself that financial and
performance accountability can be enforced in the new organizational structure. The
organizational structure of an undertaking registered tinder the Societies Registration Act is not
new to government, and no serious problems of enforcing accountability have been faced in other
such institutions. Though there are not so many examples of government-funded Section 25 "non-
profit" companies, the better statutory oversight under the Companies Act. would make the 'non-
profit' company a safer option for the government to adopt. The Management Board would, no
doubt, be appointed by the government largely from the cadre of health officials. Regular
meetings of the Management Board would ensure adequate accountability both in financial terms
and by way of performance. Since the Management Board would have a large representation of
government officials, the extent of delegation of power would, no doubt, be fixed by the Board
consistent with the precedents of other autonomous organizations that are funded by government.
The re-arranged organizational structure would doubtless improve the operational flexibility of the
unit. As things stand today, with the administrative power concentrated in the Directorate in Delhi,
it may be six months before someone has the time to attend to an urgent requisition from the
distant unit. It is observed that Secy. (HFW) in his note dt. 3-12-07 (Annexure C), had also
suggested the organizational re-structuring of the units. However, he was thinking on the lines of
either converting them into separate PSUs. Or into one amalgamated one. The Committee is of the
view that amalgamating the three units that are so different, so distant and with such a disparity in
organisational culture, would serve no purpose - the cure may be worse than the disease. The
Committee feels that, with its suggestion of registering autonomous bodies under the Companies
Act/Societies Registration Act. each unit would get adequate operational independence to pursue
their own ideas without hindrance. To sum up, the Committee is of the considered view that the
units working as attached offices to Directorate - CRI, Kasauli & BCGVL, Guindy - are
completely hamstrung. It, therefore, recommends that the Ministry consider making them
autonomous by registering them independently under the Companies Act/ Societies Registration
Act. The Committee suggest that this should be done on priority basis with adequate financial
powers delegated to the management.
9. National Vaccine Security Advisory Board
9.1 The production, supply and use of vaccines/sera constitute a very critical part of the
health system. The issues that arise, and the decisions thereon, have far-reaching and long-term
effects. Experience in this area is very limited even amongst the specialist cadres of the Central
Health Service. The analysis of the process of examination of an issue related to vaccines requires
specialist advice from a number of disciplines. From the experience in this inquiry the Committee
feels that it would be unrealistic to expect the DGHS to cope with such issues. By closing the
public sector vaccine units for some period of time, we came perilously close to a major public
health disaster. Learning from this lesson, it would be appropriate to introduce an institutional
check that would make such a serious mis-judgment less likely. In this context, the Committee
recommends that the Ministry consider constituting a National Vaccine Security Advisory Board
to offer advice on policy issues relating to vaccines and sera, which could then be utilised by the
Ministry for taking policy decisions. The composition of the Board could consist of Public Health
Specialists. Pediatricians, Vaccine/Sera manufacturing technologists. Public Health
Administrators, Social Activists etc. The present period is one in which several vaccine-related
issues are frequently cropping up. The vaccine market is one of the most lucrative markets in the
drugs and pharmaceutical sector. A large number of developing countries are introducing
universal immunization programmes as a part of their social sector initiative; significant demand
for vaccine is raised from China and India. India itself requires 25 million doses of the primary
vaccines for its newborn/infants every year. Also, new and sophisticated vaccines are increasingly
coming into the market for a large range of new diseases. There is an increasing pressure from-
these commercial interests, backed by the technologists, to introduce more and more of the new
vaccines as a part of the bouquet of primary vaccines. Also, increasingly, vaccine manufacturers
are coming out with vaccine-combos, reducing the number of times the individual has to be
approached for completing the coverage. Most vaccine-combos are very expensive. A number of
complex technical questions have to be answered while determining the UIP policy, so that the
programme remains affordable and feasible for the country. In this situation a large number of
sensitive issues can be placed before the National Vaccine Security Advisory Board for its advice,
in order to assist the Ministry in taking the final call on them. Technical discussion in the
suggested Board will obviate the random motion of ideas that we saw in the Ministry when
considering the closure of the vaccine manufacturing units. The Committee is aware that there is
already an existing National Technical Advisory Group on Immunisation. However, it seems that
this Group only goes into technical aspects of production of vaccines and sera; the Committee is
of the view that there is a need or a Board to go into the- policy aspects of Immunisation - to bring
this about, either the remit and the name of the existing Group be changed, or a new National
Vaccine Security Advisory Board be constituted to advise on the vaccine policy issues.
9.2 In sum, the Committee recommends that the government consider constituting a National
Vaccine Security Advisory Board composed of the stakeholders (Public Health Specialists,
Pediatricians, Public Health Administrators, Vaccine Technologists, Social Activists, etc) to
advise the government on important issues relating to the National Vaccine Security policy.
Some additional comments made by Dr. VM Katoch (Member of the Committee) are placed at
Annexure L.
10. Summary
(i) The Committee was entrusted the task of reviewing the events and determining, the
reasons for the closure of the three public sector vaccine/sera units in the country - CRI.
Kasauli. PM, Conoor & BCGVL. Guindy. The said closure radically altered the vaccine security
scenario in the country and made it entirely dependent on the private sector manufacturers. The
following two years experienced uncertainty in vaccine availability, and the prices of the
vaccines required for the UIP rose sharply. The vaccine/sera scenario in the country - that, for
historical reasons, had remained quite secure in the past suddenly turned vulnerable. The
Committee was mandated to ascertain the reasons for the abrupt closure of the manufacturing
units and to set out a road-map for the revival of the units to make them compliant with rigorous
GMP standards.
(ii) The committee is constrained to observe that in the matter under review, it
became necessary for it to carry out a mini-archival research in order to
determine even the sequence of events, not to talk of the rationale or analysis of
the issue involved. After a thorough review of the record of the Ministry, and an
assessment of the process adopted in the course of the examination of the issue,
the Committee concluded that the Ministry had not maintained minimal
procedural standards in examining the issue before them. (Para 4.1)
iii) The Committee assessed that the Ministry (including the DGHS and the DCGI)
did not carry out an appropriately structured analysis of the sensitive issue under
review. The discharge of the responsibility of due diligence on the part of the
Ministry required that the various facets of the issue be discussed in a simple,
structured manner so that the pros and cons were transparent The Committee is
of the view that had this been done, the Ministry would not have come to a
conclusion to close the units in an abrupt manner. (Para 4.3)
(iv) In the view of the Committee, it is very much in the interest of India to maintain
a close working relationship with WHO to strengthen the voice of the
developing countries in the global health sector. The Committee is well aware of
the valuable services provided by WHO and has kept this in mind while
discussing the appropriate bi-lateral relationship between a national government
and the multi-lateral agency. (Para 4.4. 1.1)
(v) In order to maintain a harmonious working relationship, it is important to
accurately demarcate the boundary between the reach of WHO's advocacy and
the irreducible extent of exercise of sovereign authority by the Indian
government. No matter how useful WHO's advice may be, the NRA's sovereign
function under statute - of enforcing the manufacturing standards of drugs and
pharmaceutical units - cannot be discharged in partnership with an international
organization. Under the D&C Act and Rules, the DCGI is the apex point of the
Indian regulatory system. (Para 4.4.1.2)
(vi) The decision, to permit WHO to join the NRA in the inspection of the public
sector vaccine units, should have only been taken after explicitly recording the
reasons. Once they came to be associated with the inspections, their views on
GMP-compliance became the dominant ones. The Committee is of the view that
the decision to permit WHO to join the NRA inspection was not taken with the
necessary degree of application of mind and accountability. (Para 4.4.1.2)
(vii) It is seen that the decision taken by HFM on 10-5-07, to permit WHO inspectors
to be associated with the NRA inspection, is on the basis of an opaque note
stating that Secy. (HFW) has opined that we should not object to the
participation of WHO representatives in the NRA inspection. The note does
mention that in the past the Ministry had not agreed to this request from WHO.
However, there is just no analytical discussion as to why we should reverse the
earlier position of the government. This being a sensitive issue, the reasoning for
the decision should have been recorded explicitly. In this background, the
committee is of the view that the decision to permit WHO to join the NRA
inspection was not taken with the necessary degree of application of mind and
accountability. (Para 4.4.1.2)
(viii) WHO can prescribe any norm considered appropriate in its judgment for pre-
qualification of vendors for supply of drugs and pharmaceuticals for the
international programmes, so long as these norms are not arbitrary. The
functioning of the Indian NRA has no nexus with any inspection WHO may
carry out on behalf of international drugs/vaccine purchasers. WHO's inspection
would be only for the purpose of empanelling manufacturing units as pre-
qualified vendors; and, on the other hand, the independent inspection of the
NRA, under the authority of the D&C Rules, would be to determine compliance
with Indian GMP standards. (Para 4.4.1.3)
(ix) WHO does not exercise any supervisory authority over the Indian NRA. Hence
the question of de-recognition of the Indian NRA cannot arise. (Para 4.4.1.3)
(x) The eligibility of individual applicants should in no circumstances be contingent
upon whether public sector manufacturing units have been inspected by WHO
or whether these public sector manufacturing units, in the assessment of WHO
meet its GMP standards. The Committee fools that any move to consider private
vaccine manufacturers (who are otherwise compliant with WHO GMP norms)
as ineligible because WHO finds certain public sector units non-compliant,
would be arbitrary; this has no nexus with the objective of purchasing high
quality drugs/vaccines produced under the best possible GMP standards. (Para
4.4.1.3)
(xi) As a matter of administrative practice, in the normal course, the Ministry should
have obtained from WHO their position on this sensitive issue (of de-
recognition-of the NRA by WHO if the public sector units do not meet the
latter’s prescribed GMP norms), in explicit terms in writing. The Committee
considers it imprudent for the Ministry to arrive at a decision on this important
issue merely on the basis of impressions and conjecture of some officials in the
Indian administration. (Para 4.4.1.4)
(xii) The Committee would again suggest that the Ministry may consider entering
into a candid dialogue with the DG of WHO so that the country's position is
clearly understood by WHO and no unnecessary mis-understanding persists.
(Para 4.1.4.5)
(xiii) Even if we hypothetically assume that the exports to international health
programmes run the risk of being discontinued, the impact will be nominal, as
the value of these exports is miniscule compared to the aggregate national export
earnings of about US 180 billion annually. In the perception of the Committee,
the export earnings foregone, if such an eventuality arises, would be an
insignificant loss compared to the gain through enhanced Vaccine Security for
the country over the long run. (Para 4.4.1.7)
(xiv) A study of Schedule M reveals that it covers a vast array of specifications that
collectively impact on the quality of the manufacturing process. By their very
number, nature and span of application, all these standards cannot be met to the
fullest extent by every manufacturing facility. Also, legal compliance does not
require that each of the norms be individually met to the fullest extent, but rather
that the overall compliance of the various norms should be adequate. A
shortcoming in some of the areas does not automatically call for the
suspension/cancellation of the license. To legally carry out operations in India
the drugs and pharmaceutical units are required to substantially comply with the
standards set out under Schedule M of the D&C Rules subject to the
monitoring / assessment of the NRA/DCGI (Para 4.4.2.2)
(xv) The key provision under Schedule M for GMP standards for the production area
is: “The production area shall be designed lo allow the production preferably in
uni-flow and with logical sequence of operations." This is an over-arching
provision puts it beyond doubt that production in uni-flow and with logical
sequence of operations' is a desirable goal, but not a rigid mandatory
requirement. However, the various government functionaries in the course of the
processing in the Ministry, as also during inspections, have relied on the
incorrect assumption, that absolute adherence to the principle of uni-flo of
operational process is an-irreducible mandatory requirement under the GMP
standards. (Para 4.4.2.5)
(xvi) The abrupt implementation of inflexible GMP standards would serve no public
purpose: it would only bring about a crisis, as the operations of a larger portion
of the domestic drug sector would come to a halt. (Para 4.4.2.6)
(xvii) It is the view of the Committee that, by and large, the public sector vaccine units
have maintained the required minimum technical standard, and in tandem with
rigorous enforcement of product quality standards, have been able to provide
quality preventive /curative to the citizenry, (Para 4.4.2.9)
(xviii) On the basis of the observations during its site visits, the Committee concluded
that many of the deficiencies pointed out during the inspections are minor in
nature, and even the critical requirement – ‘production in uni-flow and logical
sequence of operations' - is substantially achieved in the existing production
lines. Para (Para 4.4.2. 10)
(xix) To achieve the ultimate optimization through the entire production line, a new
manufacturing line will have to be established by incorporating the essential
technical features in the original design. It is learnt that the Ministry plans to set
up new production lines at the three locations, taking into account the reasonable
estimates of time for the administrative processing of the scheme and
implementing the new facilities, the Committee felt that a total implementation
period of three years would be required. (Para 4.4.2. 11)
(xx) The existing production lines in the three units as upgraded after conclusion of
the incomplete works could safely be used till the new production lines are
commissioned. The standards set out in Schedule M of the Rules do not require
that all the specifications be met in the most rigorous interpretation of the norms.
The standards clearly say that the work area should be designed preferably to
allow production in uni-flow and with logical sequence of operations. The
Committee is of the view that it would be safe, and in public interest, to restart
the manufacturing activities in the existing production lines with immediate
effect. More explicitly, it was the view of the Committee that, the operation of
the units would, in the totality of the prevailing circumstances be in compliance
with the GMP standards. (Para 4.4.2. 12)
(xxi) To enable the restart of manufacturing operations Government would be
required to revoke the suspension, orders in respect of all three manufacturing
units. All three units had filed appeals against the suspension orders under Rule
85 (3) of the D&C Rules. 1945. (Para 4.4.2. 12)
(xxii) The manufacturing units at CR1. Kasauli and BCGVL. Guindy were holding
considerable quantifies of finished products with them, from the time of the
closure. The Committee felt that these should not be wasted and should be used
to bridge the supply gap at least in year 2010-11. In this backdrop, the
Committee recommended that the manufacturing units be advised that, after
confirming the quality of the products, these products he supplied under the UIP
before their expiry dates. (Para 4.4.2.13)
(xxiii) The Committee observed that not even one official in the Ministry had identified
the different aspects of the issue of the closure of the units and analysed it in any
systematic manner. The overall impression that the Committee gets is that the
process of examination of the issue had spun out of control, and no one at the
senior administrative level made any attempt bring it back on track. The
constructive responsibility for this would rest on the apex functionary of the
political and bureaucratic executive i.e. the then-HFM and the then- Secy.
(HFW). (Para 4.4.3.1)
(xxiv) The final decision taken by the DCGl to issue a show-cause notice dt. 13-12-07
was on the basis of the views approved by HFM. From a recapitulation of the
process, it will be seen that the crunch-decision was endorsed at the highest
levels in both the political and bureaucratic executive line-up of the Ministry.
The Committee has already expressed the view that the decisions to suspend the
licenses were both illegal and flawed. Responsibility for the Ministry's advice
that resulted in the decision would rest at two levels - the then-HFM and the
then-Secy. (HFW).( Para 4.4.3.2)
(xxv) Despite the fact that the DCGl independently took the final decision to suspend
the licenses, without any consultation with the Ministry, there is ample evidence
to show that the Ministry, including the apex levels of the political and
bureaucratic executive, was fully in the loop. In this background, the only
conclusion that the Committee can draw is that the Ministry at its highest
political and bureaucratic, levels, was associated with the Final decision for the
closure of the units. Thus, the constructive responsibility for the final decision
would also rest on the apex functionaries of the political and bureaucratic
executive i.e. the then-HFM and the then-Secy. (HFW). (Para 4.4.3.7)
(xxvi) The Committee noted that at no level was the duty - of ensuring a rigorous and
objective analysis - discharged with the necessary diligence. In fact, evidence
on record indicates that the conclusion had been treated as pre-decided.
(xxvii) A meeting was held on 17-18th Dec, 2007 between the then - Secy.(HFW) and
the then - DCGl on the side of the Ministry, and ADG and his team from the
side of WHO regarding the GMP standards of public sector units. DCGl has
recorded that in this meeting, the Ministry had agreed to suspend/cancel the
licenses of the public sector units by 15-1-08.This assurance gave an
unmistakable indication that action against the manufacturing units was pre-
decided. There is nothing on the record to show that the approval of the then-
HFM had been obtained before giving the assurance to WHO. Also, there is
nothing on record to show that the then-HFM was informed by the then-Secy.
(HFW) about the assurance post-facto. (Para 4.4.3.9)
(xxviii) A pre-decided conclusion ab-initio vitiates a quasi- judicial proceeding. Taking
into account the tenor of the notes, the route the files had taken and the issues
which were pointedly ignored, the Committee cannot escape the perception that
the conclusion was pre-decided. In view of this finding, and regardless of all
other considerations. DCGI’s order of suspension dt. 15-1-08 would have to be
treated as null and void. Responsibility for the unilateral assurance promising
closure of the units by 15-1-10 would rest on the apex functionary of the
bureaucratic executive i.e. the then -Secy. (HFW). (Para 4.4.3.10)
(xxix) Till the new production lines are commissioned, there does not seem to be any
reason to stop manufacturing the vaccines/sera in the facilities available in the
existing production line, which in some cases have been significantly upgraded,
and in others, are undergoing upgradation. While operating the existing
production line, the management will have to ensure that their product conforms
to the product standards prescribed in the D&C Rules in every respect. The
Committee is of the considered view that at the time of issue of the suspension
orders, the public sector units were substantially complying with the letter and
substance of the GMP standards, set out under Schedule M of the D&C Rules.
The contrary assessment in the inspections in the latter half of 2007 was largely
on account of a mis-reading of the statutory requirements of the GMP standards,
as discussed in an earlier section of the Report. In the period after the closure,
many of the deficiencies listed in the inspection reports have been rectified and
action is underway to rectify the remaining deficiencies. Therefore, on restarting
after upgradation, the compliance level of the units would be superior to that
existing prior to closure. (Para 4.4.4.2)
(xxx) The impression given in certain circles that, the products from units conforming
to Indian GMP standards are inferior to the products from units conforming to
WHO recommend standards is baseless. The charge that is sometimes made -
that the Indian government is providing sub-standard vaccine/sera to its citizens
under the UIP - is an unfounded assertion (Para 4.4.4.3)
(xxxi) An overview of the entire record leads the Committee to the conclusion that,
while the lower level of the DCGI's office may have failed to put the issue in" its
correct perspective, at least they participated in some manner in the process of
decision-making. However, the Committee is constrained to note that the higher
levels of the Directorate of Health Services have not discharged their
responsibility as the technical advisors to the Ministry. Also, the Ministry
permitted the DGHS to distance itself from the policy process without demur.
(Para 4.4.5.2)
(xxxii) Ordinary prudence demands that the sources of supply be divided between the public and
private sector producers, so that the possibility of disruption of the supplies, on account of an
unforeseen crisis in commercial production, is minimized. The Committee observes that by
reducing public sector vaccine supply to zero, in one stroke a crippling blow had been inflicted
on the health security of the country. (Para 4.4.6.1)
(xxxiii) With our fortuitous head start, we are in a unique position to consolidate our
vaccine security. Also, with our low cost of production, and excellent product
quality standards, we are in an advantageous position to become the preferred
source of vaccine supplies to the countries of the developing world. In this
backdrop, the Committee is of the view that the country should try to
consolidate its historical advantage rather than becoming wholly dependent on
uncertain private commercial sources. (Para 4.4.6.2)
(xxxiv) By closing down the existing public sector vaccine production units in advance of
the commissioning of the integrated vaccine complex, the country would have
exposed itself to vaccine insecurity for five years, or an even longer period.
However, the establishment of .the new Integrated Vaccine Complex, along with
the installation of new production lines at the existing three locations, will
eventually greatly-increase the availability and reinforce the nation's vaccine
security. (Para 4.4.6.4)
(xxxv) The NRA is required to satisfy itself that overall the unit meets the irreducible
level of required compliance. The compliance with the norms has to be judged
by the NRA in the context of a variety of circumstances, including the
technology level of the unit, the design of the existing unit, the scope of change
looking to the physical lay-out of the unit, considerations of the health security
of the country, etc. In the context of the above-stated legal position, the Ministry
should have carried out an evaluation process to come to a decision on the issue
of closure of the units. The Committee is of the considered view that the then
functionaries in the ministry failed to discharge their responsibility (Para
4.4.7.2)
(xxxvi) AII in all the decision of the Ministry, both in legal terms and on consideration
of the merits, was flawed. Because the outcome of the evaluation process had
been pre-decided the entire process was null and void. On the other hand, on
consideration of the pros and cons fronm the view point of public interest, the
decision was not justified. In the view of the Committee, the palpably incorrect
decision of the Ministry - based on an illegal procedure and a Flawed
appreciation of the issues - was against broad community interest. (Para 4.4.7.4)
(xxxvii) Analysis of the data received from the Ministry, and also the observations during
the visits to the manufacturing facilities, had led the Committee to the
conclusion that the post-closure situation-was critical, for which reason some of
the Committee's recommendations needed to be submitted to the government
immediately. In these circumstances, the Committee submitted an Interim
Report dt. 5th Feb. 2010 with certain recommendations, that required
implementation without delay. Four significant recommendations from the
interim Report have already been implemented by the Ministry. (Para 4.4.7.5)
(xxxviii) To insulate the UIP from price and supply shocks, a cardinal principle of public
health policy requires sourcing of the vaccines from public sector manufacturing
units to a substantial extent. (Para 5.1)
(xxxix) Some of the deficiencies listed in the inspection reports relate to the overarching
objective of the GMP - to design the work area 'to allow the production
preferably in uni-flo and with logical sequence of operations. In the view of the
Committee the key-word in the provision is 'preferably'. Quite obviously this
word was introduced to imply that the principle of logical sequence of
operations would be enforced to the extent it is possible to optimise the working
in the circumstances in which the manufacturing units operate. (Para 6.2)
(xl) Within the given space/plot constraints at the three locations, much has been
achieved by the rationalization of the flow of men and material in the course of
the manufacturing process. In fact, in all the units, within each section of the
manufacturing process, the lay-out and the manufacturing sequence has been
optimized. It can safely be claimed that within each section of the manufacturing
line, "production in uniflo and with logical sequence of operations' has been
achieved. (Para 6.2)
(xli) Taking into account the reasonable estimates of time for administratively
processing the scheme and implementing the new facilities, the Committee feels
that an implementation period of three years would be required. (para 6.2)
(xlii) The Committee considers it necessary to record that the government has been
somewhat tardy in funding and implementing the plans for radical improvement
in the production facilities. Even after the new GMP norms came into effect on
1-7-05, the aggregate budgetary plan allocation for the three public sector units
has only been of the order of Rs. 64 crores. a sum that is grossly inadequate to
set up new, modern production lines. Looking over this span of the future
scenario, it is imperative for the country to establish at the earliest, new
production lines at the three locations by incorporating in their basic design all
the vital elements of the GMP standards. The Committee therefore, recommends
that the revocation of the suspension of the license of the units be made subject
to the condition that a new line for production of vaccine/sera will be set up at
the three locations within a period of three years. (Para 7.1)
(xliii) The Committee has observed that one major underlying cause for the
malfunctioning of the manufacturing units is the unsuitable organizational
structure they are frozen in. The manufacturing units, currently working as
attached offices to the Directorate - CRI, Kasauli & BCGVL, Guindy - are
completely hamstrung in their operations. The Committee, therefore.
recommends that the Ministry consider making them autonomous by registering
them as companies/societies under the Companies Act/Societies Registration
Act. (Para 8.1)
(xliv) The Committee recommends that the- government consider constituting a
National Vaccine Security Advisory Board composed of the stakeholder-(Public
Health Specialists. Pediatricians, Public Health Administrators. Vaccine
Technologists, Social Activists, etc) to advise (he government on important
issues relating to the National-Vaccine Security Policy. (Para 9.1 )
Shri Javid Chowdhury Dr. V.M. Katoch
Former Secretary Secretary
Ministry of Health & Family Welfare Dept. of Health Research
(Chairman) (Member)
Dr. R.N. Salhan Shri Vineet Chawdhry
Former Additional DGHS Joint Secretary
(Member) Ministry of Health & Family Welfare
(Member - Secretary)
Annexure A
Summary of points made by Dr. A. Rarnadoss,
Former HFM on 13-5-2010
During my tenure as HFM I have annoyed many lobbies - health lobby, pharmaceutical lobby,
food lobby & medical education lobby. Also, there are groups that oppose my position on social
issues. I have earned many enemies in Delhi because of what I did as Minister in the last five
years. These vested interests are behind the media campaign against me, which coincided with the
Parliament session, They have created a media campaign that I was responsible for shutting down
the vaccine units.
I feel that the Interim Report of the Committee is biased - this has been framed to please someone.
This does not take into account the real situation. The units have not been closed only the licenses
have been suspended because these three units were not compliant with GMP standards.
No pharmaceutical or vaccine unit operating in the country is non-compliant with the GMP
standards. We had shut down 2000 drug units because of non-compliance with GMP standards.
Under me law, we could not permit the vaccine units to be non-compliant while enforcing the
GMP standards for the other units. People were talking that the State was supplying poor quality
vaccines under the UIP for the national programme.
I have seen top-of-the-line production units in Europe. USA & Australia and I would like my
country to have comparable facilities. Our manufacturing facilities are heritage institutions - two
over a century old and one over sixty years old. These institutions suffer from a space constraint
and are cluttered. A completely new production line was required which would take three years.
The decision to suspend the licenses was not a sudden one - it was discussed for long with the
Secy.. DGHS & DCGI.
WHO's views were also one of the factors. The GMP standards were first introduced in year 2001.
We gave several extensions to the vaccine units to become compliant. By year 2005 all
manufacturing units had become complaint except the …………………… action was taken n the
Ministry to remedy the defects pointed out in various inspections from year 2001 should also be
recounted in the Report. The adverse situation did not arise all of a sudden in year 2007. Whether
any steps were taken from year 2000 to upgrade the facilities to ensure compliance should be
recounted. My officers did mention to me that WHO was threatening to disqualify the NRA - the
NRAs of Viet Nam and Indonesia had been de-recognised.
The vaccine technology in the world is of a different standard. There are so many new vaccines
and combo-vaccines. The public sector units do not have the competence or technology to produce
these products. The vaccine units at Connor and Guindy did not have a good reputation: they are
very old. There were frequent strikes there. In the various inspections many defects wore pointed
out. What action was taken by the Ministry to rectify them over the years? Not enough
upgradation was carried out. My officials came to me and said the WHO was threatening to cancel
NRA recognition because of this. The background leading to the suspension of the license should
be given in the Committee's Report. It is not correct to say that the suspension of the license
jeopardised the national immunisation programme.
On the basis of a technical report we took a decision to set up an integrated vaccine complex at
Chengallapatu – R&D, vaccine testing centre, DCGI office. This is well-located - half an hour
from the airport and one hour from the seaport. HLL is an appropriate agency for carrying out his
project. WHO can offer technology. But now the project is stalled. This would have improved
global availability of vaccines. Today one dose costs three hundred rupees. From the vaccine park
this would be available at fifteen rupees. This would bring down global vaccine prices. Suspension
of licenses did not lead to insecurity. There may have been occasional shortages. Meetings were
held and the issues resolved. Firm action was taken when private suppliers did not meet delivery
dead-lines. The suppliers were even threatened with black-listing.
The terms of reference require examination of the issues in the historical, technologies-
administrative and other perspectives. This has not been done in the Interim Report. Under the
D&C Act authority is with the DCGI: they need not rely on the Ministry in exercising their
authority.
Maintenance of high GMP standards is important for the country's credibility. Indian regulatory
authorities should be accepted by the first world countries.
Annexure C
Chronological Account of Process on File No. X-11026/1/2006-D
S.
No.
Date Substance of Note Note initiated by Note set to
1. 5-4-07 Note seeking directions of HFM on whether to
permit WHO team to inspect the public sector
vaccine manufacturing facilities. Issues
highlighted: (i) Pre-qualification of private
sector vaccine exporters contingent upon
favourable assessment of NRA by WHO team;
(ii) WHO expects the public sector
manufacturing units to conform to Schedule M,
as also to their other requirements of pre-
qualification; (iii) if NRA is de-recognised by
WHO, private sector vaccine manufacturers
will lose about Rs.400-500 crores of annual
exports to UN programmes; (iv) in year 2002
the Ministry had disallowed the WHO
inspection of public sector vaccine
manufacturing units as that would tantamount
to WHO exercising regulatory control over the
NRA; (v) Government will have to shut down
production in its existing public sector units.
Appropriate up-grading of the public sector
facilities will take at least two years – impact
on the availability of vaccines for the public
health programmes will have to be assessed.
DCG(I) DG
2. 16-4-07 No substantive comment. DG JS/Dir(AT)US(D)/
SO(DFQC)
3. 26-4-07 ……….. of DCGIs note submitted for taking a
policy decision as to whether WHO team may
be permitted to inspect public sector vaccine
manufacturing units
SO(D) US(D)/Dir(AT)
4. 3-5-07 File sent for further action as per the discussion
at the meeting taken by Secy. (HFW) on 3/5.
Dir(AT) DCGI
5. 3-5-07 Proposal for permitting participation of WHO
representatives in inspection of public sector
DCG(I) DG/Secy. (HFW)/
HFM
undertakings engaged in vaccine manufacture,
as decided in meeting taken by Secy. (H),
submitted for approval of HFM. Other issues in
DCGI’s note dt. 5-4-07 not touched upon.
6. 26-6-07 Composition of WHO inspection team and
proposed programme submitted for approval.
DCG(I) DG/Secy. (HFW)
7. 22-10-07 The note recorded the discussion in the meeting
taken by Secy. (H) on 11-9-07 with reference
to WHO’s observations on the basis of the
NRA inspection. The decision at the meeting
were: (i) the public sector manufacturing units
wind-down operations by stopping
procurement of raw materials and production;
(ii) they urgently prepare a plan for setting up
new manufacturing facilities; (iii) Efforts be
made by the UIP Div. To build up buffer stocks
to meet possible shortages.
The note recorded the following decisions at a
subsequent meeting taken by HFM: (i)
Ministry should take up with WHO HQs the
need for a longer period for up-gradation of the
facilities. A team of senior officers be sent to
Geneva for this; (ii) immediate steps be taken
to improve the manufacturing facilities by
renovation / new facilites, to comply with the
deficiencies pointed out by WHO; (iii) The
plan to set up a Vaccine Park at Chengallapatu
immediately be drawn up.
DCG(I) DG
8. 25-10-07 No substantive comments GD JS(DP)9. 22-10-07
Parallel note
floated on the
same File No.)
Detailed notes on the deficiencies pointed out
by the WHO in the NRA inspection. The main
deficiencies pointed out were: (i) Lack of
quality assurance system for the regulatory
DCG(I) DG
procedure; (ii) Lack of clear procedure for
dossier review (iii) Lack of defined recall
procedure; (iv) Absence of SOPs for the
technical functionaries; (v) if all manufacturing
units (public and private) do not meet WHOs
satisfaction for GMP, the NRA would be
derecognised, rendering even the private sector
units ineligible for pre-qualification. Note
proposed an interim reply to WHO committing
to the compliance of all the points, except the
main point i.e. action against PSU – which was
under examination then.
10. 23-10-07 No substantive comments DG DCGI/JS(DP)11. 31-10-07 Note on the Executive Summary of WHO’s
Assessment of the NRA. Proposal to negotiate
with WHO to provide more time for PSUs to
comply with GMP requirements and therefore
not to link NRA assessment to de-registration
of public sector vaccine manufacturers.
Suggestion that PSUs be directed to come up
with their action plans.
JS(DP) AS(DG)
12. 1-11-07 Raised some queries. Directed that the issues
be discussed between JS (DP), JS (Bud.) &
DCGI. No further action was taken – matter
petered out.
AS(DG) JS(DP)
13. 3-12-07
(Pt. File with
unchanged
number)
Reminder to expedite the matter regarding draft
reply to be sent to WHO before 05.12.2007.
DCG(I) JS(DP)
14. 6-12-07 Follow up with PS to HFM for the file having
draft reply to be sent to WHO before
05.12.2007 reportedly approved by Secretary
(HFW) and marked to HFM for approval on
04.12.2007.
DCG(I) PS to HFM
15. 14-12-07 Note recording the decisions taken by HFM in
the meeting held on 13.12.2007. The following
decisions are mentioned: (i) To issue show
cause notices to CRI, Kasauli, PII, Coonoor
and BCGVL, Guindy for GMP compliance, (ii)
to ask the units to give a time-frame for
compliance of the deficiencies pointed out by
WHO team; and (iii) to make a presentation to
the Expert Body of WHO regarding India’s
response to the assessment made by
……………
DCG(I) Secretary (HFW)
16. 15-1-08 Note on NRA assessment and decision taken in
the meeting taken by Hon’ble HFM on
13.12.2007 – Show cause notice issued to CRI,
Kasauli, BCGVL, Guindy and PII, Coonoor on
14.12.2007.
Dr. C. Sokhey DCG(I)
17. 16-1-08 Note recording the commitment made by Secy.
(HFW) at a meeting held on 17-18 Dec., 2007
with ADG, WHO and others when DCGI was
also present, to the effect that the licenses of
the public sector manufacturing units would be
suspended / cancelled by 15-1-08. Also that the
existing stocks of bulk vaccines on that date
would be destroyed. In quid-pro, the existing
units on the WHO list of pre-qualified
tenderers would be retained. DCGI also reports
that accordingly the licenses of the three units
have been suspended on 15.1.08.
DCGI DG/Secy (HFW)
Annexure D
Chronological Account of Process on File No. X –
11026/1/2006 -D (pt. file)
S.
No.
Date Substance of Note Note initiated
by
Note sent to
1. 27-11-07 Reminder on part file with draft letter to
WHO on action assured on all issues
except closure of PSUs
DCGI DG
2. 27-11-07 No comment DG JS(DP)/AS(DG)
3. 28-11-07 Inquires on plan-of-action of PSUs. Says
draft letter missing. Suggests letter to DG,
WHO
AS(DG) JS(BKP)
4. 1-12-07 Highlights of WHOs inspection report of
NRA. Recalls decisions at meeting taken
by Secy, on 11-9-07 and thereafter at
meeting taken by HFM. Mentions two
options: (i) Negotiate with WHO for
more time;; (ii) move towards a gradual
shut-down and make arrangements for the
UIP. Directions were sought.
JS (BKP) AS(DG)
5. 1-12-07 Suggests issue of show cause notice for
suspension of license; move towards
gradual shut-down; move for integrated
unit; take up issue with DG, WHO during
ensuing visit.
AS(DG) Secy.(HFW)
6. 3-12-07 Supports action suggested by AS (DG). Secy. (HFW) M(HFW)
7. 13-12-07 Discussed with Secy. (HFW) and
approved suspended/ cancelled by 15-1-
08. Also that the existing stocks of bulk
vaccines on that date would be destroyed.
In quid-pro, the existing tenderers would
M(HFW) Secy.(HFW)
be retained. DCGI also reports that
accordingly the licenses of the three units
have been suspended on 15.1.08.
Annexure E
F. No. M – 11035/3/06/EPI
S.
No.
Date Substance of Note Note initiated by Note sent to
1. 4-1-08 Recounts the issue of notice by DCGI for
suspension of licenses. States DCGIs
legal authority to take action. Gives a
summary account of deficiencies
pointed out in the inspections.
Recounts the proceedings In the
Ministry. Gives a gist of
representation of CRI, Kasauli. Points
out that there is confusion in the
minds of the management of the
units, as also in the Ministry. Sets out
options for inking decisions;
tentatively suggests continuation of
the operations of the units.
ADG (EP) DDG(NSD)/Addl.
DG/DG
2. 9-1-08 DG records that he has been informed by
DCGI that the decision for
cancellation has been taken as per the
not with the approval of the highest
authority. Directs that the plan to
make good the deficiencies should be
made implemented expeditiously.
DG Addl.DG/DDG
(NSD)
3. 24-1-08 Refers to representations from CRI, Kasauli
and BCGVL, Guindy in response to
show-cause notices. Seeks decisions
on post-closure actions.
ADG(EPI) DDG(NSD)/DG
4. 29-1-08 Observes that the action should be taken at
the manufacturing units and in the
EP! Division. Finds fault with them
for not taking initiative.
DG Addl. DG/ADG
(EPI)
Annexure F
Note of Dissent - Vineet Chawdhry - Member-Secretary - Reference para 4.4.4.2
'I am attaching herewith extracts from the SFC memo circulated in 1999 and approved by the
ministry in 200! regarding renovations at CRI Kasauli. The memo acknowledges that the facilities
at CRI Kasauli do nor meet cGMP requirements and the requirements of schedule M. The
principal requirement of the SFC memo has been stated as " construction of new building and
partial renovation of the existing building of Triple vaccine to house the facilities for
manufacturing above mentioned vaccines and quality control of the vaccines and filling and
supply of the vaccines in a uniflo system." This SFC was approved in 2001 and work was awarded
to Ms HSSC. We are in the process of fixing responsibility on HSCC and officers of Dte GHS for
not executing the project properly on account of which CRI could not comply with statutory
standards. In view of this, how can the committee now take a position that CRI Kasauli was
compliant with the requirements of Schedule M and that a uniflow system was only a preferable
requirement and hence not essential. I have a feeling that the Committee has not seen such related
documents including the process of assessment of NRA by the WHO and its implications for
India. I have, therefore, been repeatedly suggesting that we need to discuss these issues with the
officers who were handling 'his matter. Unfortunately, this has not been agreed to by Mr. Javid
Chaudhary. I would, therefore, reiterate that we need to discuss these issues with the officers as
suggested by me earlier. Otherwise, it is not possible for me to support the findings of the
committee that CRI Kasauli was eGMP compliant.’
Annexure G
Supply of Vaccines from Public and Private Sector Manufacturing Units in the period 2004-
05 to 2005-06
Vaccine Year 2004-05 Year 2005-06
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
BCG 482 482 0 100 637 637 0 100
DPT 1289 443 846 34 770 520 250 68
DT 330 177 153 54 210 210 0 100
IT 1438 426 1012 30 768 270 498 18
Supply of Vaccines From Public and Private Sector Manufacturing Units in the period 2006-
07 to 2007-08 - Contd.
Vaccine Year 2004-05 Year 2005-06
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
BCG 895 895 0 100 800 800 0 100
DPT 1000 920 80 90 1680 920 760 55
DT 332 290 42 90 425 335 90 79
IT 1212 1062 150 88 1235 1235 0 100
Supply of Vaccines from Public and Private Sector Manufacturing Units in the period 2008-
09 to 2009-10 - Contd.
Vaccine Year 2004-05 Year 2005-06
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
Total Supply
PublicSectorSupply
PrivateSectorSupply
%Public to Private
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
(Lakh doses)
BCG 600 0 600 0 1026 0 1026 0
DPT 1440 0 1440 0 1026 0 1026 0
DT 475 0 1700 0 1370 0 1370 0
IT 1700 0 1700 0 1370 0 1370 0
Annexure J
Universal Immunisation Programme
Achievement for the period of 2009-10
Sl.No.
State/UTs/India TargetInfants
(2009-10)
BCG DPT3 OPV3 Measles FIC*(12-23 months)
Achievement Coverage Achievement Coverage Achievement Coverage Achievement Coverage Achievement Coverage1. A&N islands 7.000 5,195 74.2% 4,792 68% 4,845 69.2% 4,732 67.6% 5.082 72.6%2. Andhra Pradesh 1.480.000 1,539.151 104.0% 1,507.164 101 8% 1.508.254 101.9% 1.498.743 101.3% 241.204 16.3%3. Arunachal Pradesh 26.000 16.040 61.7% 12.753 48.9% 12.881 49.5% 12,301 47.3% 11,235 43.2%4. Assam 682.000 672.623 98.6% 611,784 89.7% 610,139 89.5% 590,543 86.6% 149,893 22.0%5. Bihar 2.655000 2,258,13 85.1% 2,236.885 84% 1 2,117.930 798% 1,948.700 73.4% 1,159,124 43.7%6. Chandigarh 20.000 24,508 122.5% 16.457 82.3% 16,413 821% 17.475 87.4% 3,585 17.9%7. Chhattisgarh 593,000 594,80 100.3% 578.978 97.6% 580.782 97.9% 571.692 96.4% 185.335 31.3%8. Dadra & Nagar
Haveli
9,000 8,057 89.5% 8,031 89.2% 8.047 89.4% 7.725 85.8% 2,901 32 2%
9. Daman & Diu 4.000 959 24.0% 1.123 28.1% 1.123 28.1% 1,049 26.2% 1,602 40.1%10. Delhi 309,000 268,889 87.0% 226.366 73.3% 227.857 73.7% 219.370 71.0% 115,753 37.5%11. Goa 25,000 24,332 97.3% 19.046 76.2% 22.983 91.9% 22,303 89.2% 3,719 14.9%12. Gujarat 1.263.000 1.236,87 97.9% 1.163.000 93.7% 1.172.698 92.9% 1,139.887 90.3% 652,791 51.7%13. Haryana 549,000 602,714 109.8% 565.811 103.1% 564,871 102.9% 552,163 100.6% 462.534 84.3%14. Himachal Pradesh 111.000 131,26 118.3% 127,210 114.7% 127,358 114.7% 123.899 111.6% 971 0.9%15. Jammu & Kashmir 207,000 197.141 95.2% 227,907 110.1% 227.957 110.1% 237,015 114.5% 195,103 94.3%16. Jharkhand 767.000 687,395 89.6% 685,434 89.4% 686,090 89.5% 636,987 83.0% 359,159 46.8%17. Karnataka 1,110,000 1,049,76 94.6% 1.024.456 52.3% 1,117,867 100.7% 967,942 87.2% 716.669 64.6%18. Kerala 496,000 522.698 105.4% 539,068 106.7% 539.496 108.8% 504,701 101.8% 257.213 51.9%19. Lakshadweep 1.000 514 51.4% 587 58.7% 583 58.3% 471 47.1% 430 43.0%20. Madhya Pradesh 1.867,000 1,616,41 86.6% 1.664.357 89.1% 1.653,330 88.6% 1,684,808 90.2% 681.776 36.5%21. Maharashtra 1,932,000 2,049,22 106.1% 1.871,277 96.9% 1.866,707 96.6% 1.825.486 94.5% 563,811 29.2%22. Manipur 35,000 50.460 144.2% 45,713 130.6% 45,599 130.3% 41,319 118.1% 10,934 31.2%23. Meghalaya 59,000 76,084 129.0% 61.783 104.7% 61.479 104.2% 54,278 92.0% 127.383 215.9%24. Mizoram 18,000 23.687 131.6% 23.732 131.8% 23.256 129.2% 21.833 121.3% 12,601 70.0%25. Nagaland 38,000 23,030 60.6% 23,433 51 7% 23,816 62.7% 22,659 59.6% 19.530 51.4%
26. Orissa 804,000 766,288 95.3% 772.067 96.0% 758,366 94.3% 748,451 93.1% 453,221 56.4%27. Puducherry 19.000 36,179 190.4% 15,367 80.9% 16,716 88.0% 15.368 80.9% 3.664 19.3%28. Punjab 459,000 462,624 100.8% 452,066 98.5% 452,135 98.5% 430.929 93.9% 111.625 24.3%29. Rajasthan 1,730.000 1.757.754 101.6% 1.657.284 95.8% 1.650.680 95.4% 1,604.341 92.7% 772,614 44.7%30. Sikkim 11.000 8,045 73.1% 8.811 80.1% 8,105 73.7% 8.590 78.1% 249 2.3%31. Tamil Nadu 1,019,000 1,080.319 106.0% 1.086.414 106.6% 1 1,076.147 105.6% 1,092.700 107.2% 92,737 9.1%32. Tripura 58.000 48,371 83.4% 43,702 3% 43,274 74.6% 41.408 71.4% 11,908 20.5%33. Uttar Pradesh 5.379.000 5,667.033 105.4% 5,455.016 101:4% 5.509.199 102.4% 5.236.357 97.3% 2,366,016 44.0%34. Uttarakhand 189.000 198,889 105.2% 201.098 104.4% 194.616 103.0% 181.690 96.1% 102,533 54.3%35. West Bengal 1.523,000 1,616.206 106.1% 1,559.288 102.4% 1.487,271 97.7% 1,446.366 950% 518.258 34.0%
INDIA 25,454,000 25,321,69 99.5% 24,518,446 96.3% 24,418,870 95.9% 23,514,281 92.4% 10,373,163 40.8%
FIC: Fully Immuinized Children
Annexure K
Plan Allocation / Expenditure in PIL, Conoor, CRI,
Kasauli & BCGVL, Guindy
S. No.
Year PII, Conoor BCGVL, Guindy CRI, Kasauli
Budgetary Allocation Plan (Rs. Corers)
Expenditure (Rs.
Crores)
Budgetary Allocation Plan (Rs. Corers)
Expenditure (Rs. Crores)
Budgetary Allocation Plan (Rs. Corers)
Expenditure (Rs. Crores)
1. 1995-96 1.03 0.79 - - 2.35 1.592. 1996-97 0.85 1.25 - - 8.32 7.163. 1997-98 1.10 0.88 0.60 0.60 4.60 3.704. 1998-99 1.50 1.29 1.50 1.50 5.14 3.505. 1999-00 2.00 1.36 1.80 1.80 3.36 5.306. 2000-01 2.50 2.25 0.50 0.50 5.35 5.147. 2001-02 6.00 3.72 1.00 1.00 4.00 4.008. 2002-03 3.00 4.87 1.70 1.70 3.38 3.389. 2003-04 7.50 4.21 2.56 1.90 5.00 5.0010. 2004-05 6.96 7.98 1.73 1.62 5.06 5.0611. 2005-06 3.08 7.64 2.12 …… …. 5.9812. 2006-07 9.47 11.10 1.27 1.27 6.52 6.5213. 2007-08 10.00 10.28 3.90 3.69 4.62 4.5514. 2008-09 11.46 8.81 2.05 0.50 4.48 4.5215. 2009-10 11.26 11.43 0.91 0.39 6.79 6.71
Annexure L
Additional points
The Committee is submitted its report according to its terms of reference (i) To review the reasons for
suspension of the manufacturing licenses of the three institutes, from the historical, technological,
administrative/ organizational and other perspectives and (ii) To review the road map for the revival to
make them Good Manufacturing Practices (GMP) compliant.
While we have absolute unanimity in our views regarding the proposed road-map for revival, and about
validity of decision to suspend the licenses, in my view there should have been better analysis of
reasons specially of historical and other related aspects so that we do not land up in such situations,
avoid repeating such mistakes and perform better:
3.1. There should have been more data to analyse. A chronology of events listed from 12th March
2001 to 2010 was recently provided in the last butch of papers received before our final meeting on I6lh
September 2010 ( DGHS/ DCGI) . This shows that inspections in 2004 and 2006 ( in which WHO was
associated) had pointed out some deficiencies Sh. Vineet Chawdhry. Joint Secretary, the then Member
Secretary had also pointed out that restructuring of the facilities was also planned much earlier ( may be
8-10 years back) so as to make them equivalent to national / international standards. No records of steps
taken during those critical years (before 30th June, 2005 and up to April 2007) have been presented
despite my repeatedly asking for the same. It appears that there was little or no action between June
2005 to April 2007 when finally the process towards suspension of their licenses began. Our historical
analysis does not capture those important events. In my view this was important as history should teach
us lessons for the present and future.
3.3. Chronology of events presented now shows that WHO was possibly associated with
inspections even in 2004.
4.4.2.10. On the basis of the observations during ………………………………… that many of the
deficiencies pointed out are minor in nature, and even the key requirement -"production in uni-flow and
logical sequence of operations" - is substantially achieved in the existing production lines. In my view
these minor deficiencies should have been corrected much earlier if proper and adequate
internal/assessments and implementation mechanisms re in place. We should undertake this assessment
and take appropriate steps now.
4.4.3.1. It was concluded that the flawed decision was the result of multiple human errors and that the
constructive responsibility for this would rest on the apex functionaries of the political and bureaucratic
executive i.e. HFM and Secy. (HFW). I do not. think that this was a pure human error. There was a
clear thinking to be compliant with WHO prescribed standards which became the main goal lending lo
final decision to suspend the licenses.
4.4.3.6. Regarding the point of view presented by Former-HFM, we concluded "In totality, during his
meeting with the Committee, the Former-HFM did not mention a single point of significance that could
have improved the Ministry's case in defending the handling of this issue." While I am of the view
(same as other members of committee) that we should have decided the issue purely on the basis of our
GMP standards and national perspective without any directions from WHO, former HFM had main
emphasis on global standards.
4.4.3. 11. While I agree with the conclusions that in this case MOHFW was involved in the process of
giving commitments as well guiding the process and thus can not dissociate from responsibility of final
decision to suspend the licenses, in my view the opinion of Member Secretary about responsibilities of
DCG(I) and MOHFW is correct as a matter of principle. I would emphasize that functional autonomy
and thus the accountability of DCG(f) should be ensured for taking decisions on regulatory aspects as
per Indian law and guidelines.
4.4.5.1 and 4.4.5.2. It is logical to think that the contribution of the DGHS's advice should have been
decisive in this matter particularly on the issue of vaccine security. DGHS has interpreted that he was
not required to participate in policy making and it was the job of executive and political establishment.
There is nothing on record to establish that his active role in the decision making was insisted upon.
V. M. Katoch
Secretary, Department of Health Research
And Director-General. Indian Council of Medical Research
22nd September. 2010