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In India, the pharmaceutical industry is the third largest in the world in terms of volume, backed by many Indian and foreign pharmaceutical companies engaged in India. The government has taken many measures to encourage and promote pharma company registration in India, such as necessary amendments and refinements in the Patents Act of 1970, subsidies and support to pharmaceuticals and biotechnology, and allowing FDI up to 100% to the Indian biotechnology sector, etc.
In India, the pharmaceutical sector is expected to grow with an annual growth rate of over 10%. The major importers of Indian pharmaceutical products have been South Africa, the USA, Russia, Nigeria, the UK, Kenya, Brazil, Tanzania, Germany, Australia, etc.
The most suitable and convenient types of company structures for the establishment of a pharma company are as follows:
A pharmaceutical company also needs to apply for various licenses and registrations after obtaining the company registration, which is as follows:
Every pharmaceutical company needs a drug license to manufacture, distribute and market drugs in India. The Central Drugs Standard Control Organisation (CDSCO) and the State Drugs Standard Control Organisation (SDSCO) are responsible for issuing drug licenses. These are the different types of drug licenses that a pharma company requires:
Pharma companies that manufacture drugs, including allopathic, homoeopathy, ayurvedic, cosmetics and other medicines, must obtain a drug manufacturing license.
Wholesale drug license
Pharma companies selling medications in bulk, such as through a PCD (Propaganda cum Distribution) pharma franchise, must obtain a wholesale drug license.
Retail drug License
Pharma companies selling drugs or cosmetics for consumers’ consumption must get a retail drug license.
Pharma companies that do not have land to manufacture drugs but use manufacturing facilities of another licensee should apply for a loan license.
Pharma companies importing the products for the manufacturing of drugs or engaged in importing drugs to India should obtain an import license.
A Goods and Service Tax (GST) registration is essential for a pharma company to distribute and market drugs. When the pharma companies have a turnover of above Rs.40 lakhs, do inter-state supply of goods, or have stockists or distributors in other states must mandatorily obtain GST registration and GSTIN (Goods and Service Tax Identification Number). When the pharma company imports or exports drugs or products for manufacturing drugs, it needs to obtain Import-Export Code (IEC) license.
When the pharma company is marketing food and dietary supplements along with pharmaceutical products, it must apply for an FSSAI registration. Some commonly used food supplements by pharmaceutical companies are omega-3 fatty acids, lycopene products, vitamin preparation, calcium supplements, enzymatic products, etc.
A trademark and patent registration are necessary for a pharma company. Though trademark and patent registration are not mandatory, it is essential to prevent others or competitors from using the intellectual property of the company, i.e. company name, brand or logo used for pharma products. Patent registration protects the preparation method of pharma products and prevents others from using the same method to prepare similar medicines or drugs.
Pharma companies are a booming market in India, especially with the government’s support to entrepreneurs to establish manufacturing and marketing pharma companies. A pharma company can be established for manufacturing drugs and medicines or marketing the same. However, it must obtain all the required licences and registrations to operate its business successfully.
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