What is Eligibility Criteria for Obtaining a Drug License?

Starting a business in the pharmaceutical sector, such as a pharmacy, wholesale drug business, or manufacturing unit, requires a drug license. The drug license is issued by the regulatory authority under the Act of Drugs and Cosmetics, 1940 and the rules laid down under Drugs and Cosmetics Rules, 1945. It ensures that drugs are manufactured, sold, or distributed legally and safely.

In this blog, we will explore about the eligibility criteria for obtaining a valid drug license in simple terms.

What is a Drug License?

A drug license is a valid legal permit issued by the State Drug Control Department or the Central Drugs Standard Control Organization (CDSCO). It allows a person or company to manufacture, distribute, or sell drugs in India. The license is mandatory for any business involved in drugs or pharmaceuticals to ensure that the medicines are safe, effective, and not harmful to public health.

Why is a Drug License Important?

• Consumer Safety: Ensures drugs are of good quality and free from contamination.
• Legal Compliance: It helps to avoids legal actions and penalties.
• Market Trust: Builds trust with consumers and healthcare providers.
• Regulatory Monitoring: Ensures the business follows the guidelines of the Drugs and Cosmetics Act and Rules.

Types of Drug Licenses

Before understanding the eligibility criteria, it’s important to know the types of drug licenses.

1. Retail Drug License (RDL) – For pharmacists selling drugs directly to consumers.
2. Wholesale Drug License (WDL) – For distributors or wholesalers who supply drugs in bulk to retailers.
3. Manufacturing Drug License – For units manufacturing drugs and cosmetics.
4. Loan License – For businesses manufacturing drugs using facilities of another licensed manufacturer.
5. Import License – For businesses importing drugs into India.

General Eligibility Criteria

The eligibility criteria primarily depend on the type of drug license and the nature of the business. Let’s discuss them one by one.

1. Eligibility Criteria for Retail Drug License (RDL)

This license is issued to pharmacies selling drugs to consumers.

• Qualified Pharmacist: The applicant must have a registered pharmacist with a valid registration under the State Pharmacy Council.
• Premises Area: The pharmacy premises must have a minimum area of 10 square meters (approximately 107 square feet).
• Storage Facility: Proper storage facilities must be available, including refrigerators for medicines requiring cold storage.
• Premises Ownership: The applicant should have legal possession of the premises (ownership proof or rental agreement).
• Financial Background: Some states may ask for financial or other relevant proof to ensure the business can operate effectively.

2. Eligibility Criteria for Wholesale Drug License (WDL)

This license is issued to the businesses selling drugs in bulk to retailers.

• Qualified Person: The applicant must have:
            a) A degree or diploma in pharmacy, or
            b) A minimum of one year of experience in drug sales in a registered firm.

• Premises Area: Minimum area of 15 square meters (approximately 161 square feet).
• Storage Facility: Proper storage for drugs, including temperature-controlled storage if required.
• Premises Ownership: Legal ownership or valid lease/rental agreement for the premises.
• Business Registration: The business must be registered under applicable relevant commercial regulations, laws.

3. Eligibility Criteria for Manufacturing Drug License

This license is for companies that manufacture drugs and cosmetics.

• Qualified Technical Staff: The applicant must employ professionals like technical staff with qualifications in pharmacy, pharmaceutical chemistry, microbiology, or similar fields.
• Manufacturing Premises: Must comply with Good Manufacturing Practices (GMP) as per Schedule M of the Drugs and Cosmetics Rules. The premises must be clean, well-ventilated, and equipped with proper machinery.
• Equipment and Facilities: Must have proper equipment for manufacturing, testing, and storage.
• Quality Control Laboratory: A separate lab with qualified staff for testing raw materials and finished products.
• Other Approvals: If manufacturing certain drugs like Schedule X drugs (narcotics and psychotropic substances), additional approvals are needed from the Drug Controller General of India (DCGI).

4. Eligibility Criteria for Loan License

This is for businesses that want to manufacture drugs but do not have their own manufacturing unit.

• Agreement with Licensed Manufacturer: The applicant must have a formal agreement with an already licensed manufacturer.
• Qualified Technical Staff: Must employ qualified staff to supervise the manufacturing process.
• Legal Documents: Copies of the agreement, manufacturing license of the contracted unit, and business registration proof are required.

5. Eligibility Criteria for Import License

For businesses importing drugs into India.

• Import Registration Certificate: Required for the foreign manufacturer, issued by CDSCO.
• Valid Wholesale License: The applicant in India must hold a valid wholesale drug license.
• Proper Storage and Distribution Facilities: To store and distribute imported drugs safely.
• Documents Required: Import license application form, fee payment proof, labels, composition of the drug, product literature, and a copy of the foreign manufacturing license.

Additional Points to Note

• Location of Premises: The premises must not be located in unhygienic or unsafe areas. It must meet local municipal regulations.
• Inspections: Before granting the license, the Drug Inspector will conduct inspection under the premises to ensure it meets all requirements.
• Separate License: A separate license is needed for each premise, even if owned by the same applicant.
• Renewal: Drug licenses need to be renewed periodically (every 1-5 years depending on state laws).

Documents Generally Required for Drug License

1. Application form (in the prescribed format)
2. Identity proof of the applicant (Aadhar, PAN)
3. Proof of ownership or rental agreement for premises
4. Qualification certificates of the pharmacist or technical staff
5. Affidavit or declaration form
6. Copy of the registered partnership deed or company registration certificate
7. Site plan and layout of the premises
8. Fee receipt for license application

Conclusion

Getting a drug license is essential if you want to run a pharmaceutical business in India. The eligibility criteria primarily depend on that which type of license you are applying for – retail, wholesale, manufacturing, loan, or import. The key requirements for getting licence include, you must have qualified staff, proper premises, storage facilities, and following legal guidelines.

If you are planning to apply for a drug license, it is advisable to consult with a drug law consultant or approach the State Drug Control Department for proper guidance. By fulfilling the eligibility criteria and following the correct procedures as prescribed, you can ensure that your business is legally compliant and contributes to public health and safety.