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ASG Hospital’s acquisition of a majority stake in Vedanta Centre for Ophthalmic Sciences

JSA advised and assisted ASG Hospital Private Limited (ASG) in acquiring a majority stake in Vedanta Centre for Ophthalmic Science Private Limited. Vedanta Centre for Ophthalmic Science Private Limited is a leading eye hospital in Patna.

The deal involved transferring the eye care hospital to an entity acquired by ASG. JSA assisted in advising on the transaction’s structuring, due diligence, preparation, negotiation, and finalization of transaction documents.

Our transaction team comprised: Partner – Rajul Bohra, Principal Associate – Priyal Jain Somvanshi, and Associates – Anmol Khurana and Ishani Moulik.

Tags Healthcare, JSA, Leading Law Firm, Leading Lawyers, Mergers and Acquisitions, Private Equity

JSA advises Promoters of Mega Fine Pharma Private Limited on acquisition of majority stake by Motilal Oswal

JSA advised Mr. Shailesh Sanghvi (Promoter and Managing Director) and other continuing Promoter shareholders of the Sanghvi family in relation to a transaction involving acquisition of majority stake of Mega Fine by MO Alternate Investment Advisors Private Limited, a subsidiary of Motilal Oswal Financial Services Limited. Shailesh Sanghvi and family will continue as Promoters of Mega Fine.

Mega Fine is a Mumbai based export focused company engaged in development, manufacturing, and sale of a diverse range of high-value, low-volume niche for chronic therapies active pharmaceutical ingredients (APl). It has two USFDA approved manufacturing facilities in Nashik and Vapi. Mega Fine has long-standing relations with leading global pharmaceutical companies and has achieved global market leadership in some of its key APls.

Our transaction team comprised: Lead Partner – Vikram Raghani, Partner – Abhijeet Sonawane, and Associates – Vaishnavi Vyas and Tanishqua Desai.

Tags Investment, JSA, Leading Law Firm, Leading Lawyers, Legal Updates, Merger and Acquisition, Pharmaceuticals, Private Equity

Acquisition of Adroit USA Inc. (and its Indian manufacturing subsidiary – AUSA Medical Devices Private Limited) by Medical Device, Inc.

JSA acted as Indian legal counsel to Adroit USA Inc., its wholly owned subsidiary – AUSA Medical Devices Private Limited and their promoters, in connection with the 100% sale of Adroit USA Inc. and AUSA Medical Devices Private Limited to Medical Device, Inc. (an entity set up by Arterex for the purposes of the acquisition).

Arterex is a leading global medical device developer and contract manufacturer. Adroit USA Inc. provides custom, value added, turnkey solutions to the medical device industry and offers solutions to businesses of all sizes, from startups to Fortune 500 companies. The company has two ISO 13485-certified facilities in Bangalore, India, that provide various capabilities for complete medical device manufacturing.

Our transaction team comprised, Lead Partner – Sidharrth Shankar, Partner – Nandini Seth, Principal Associate – Aditya Vardhan Dayal, Senior Associate – Rupaly Middha, and Associate – Pranav Rao N.

Our taxation team comprised, Partner and Head of Practice, Direct Tax – Kumarmanglam Vijay, Partner and Head of Practice, Indirect Tax – Manish Mishra, Partner – Surajkumar Shetty, Of-Counsel – Ankur Mittal, Senior Associate – Divyam Mittal, Associate – Dhwani Vyas, and Principal Consultant – Ruchita Modi.

Our competition team comprised, Partner and Chair, Competition Law – Nisha Kaur Uberoi, Partner – Harshita Parmar, and Principal Associate – Rahat Dhawan.

Tags Healthcare, JSA, Leading Law Firm, Leading Lawyers, Legal Updates, Life Sciences, Medical Devices

JSA advised Blue Earth Capital AG in its investment in Apex Kidney Care Private Limited.

JSA advised Blue Earth Capital AG (Blue Earth) in relation to its proposed acquisition of stake in Apex Kidney Care Private Limited (Apex) from existing investors for approx. USD 9 Million. Apex is a leading service provider of kidney care and runs a chain of dialysis centers across different cities in India.

Deal Value: Approx USD 9 million

Our transaction team comprised Lead Partner – Lalit Kumar, Partner – Amandeep Singh Virk, Senior Associate – Zarish Ali, Associates – Ruchika, Sameer Dahiya and Muskaan Gupta.

Tags deal, Healthcare, JSA, Kidney Care, Leading Law Firm, Leading Lawyers, Legal Updates, Life Sciences, Pharma

JSA Newsletter | Healthcare | November and December 2024 Edition

Please click here to download the Newsletter as a PDF.

Introduction

The Indian healthcare sector is one of the shining spots in the Indian economy. Recognising the significance of this sector, the Government of India (“GoI”) took various steps in 2024 to support the expansion and growth of the healthcare industry at the macro and micro level. The final couple of months of 2024 witnessed some interesting developments, on the legal, regulatory and investment front.

The Ayushman Bharat Digital Mission (“ABDM”), a mission aimed at streamlining India’s digital healthcare infrastructure by integrating and harnessing the necessary support of government bodies, non- government organizations, healthcare and health tech- oriented companies and other private players in health care and health- tech space (including health insurers and healthcare practitioners) has enabled interoperability of health data within the Indian health ecosystem, supporting the digital health infrastructure of the country. As on November 2024, more than 68,00,00,000 (sixty-eight crore) Ayushman Bharat Health Accounts (“ABHA”) have been created, approximately 3,50,000 health facilities have registered on the Health Facility Registry, more than 5,00,000 healthcare professionals have registered on the Healthcare Professional Registry (“HPR”) and more than 45,00,00,000 (forty five crore) health records have been linked with ABHA.

Further, the GoI introduced initiatives to boost the medical device industry and the homeopathic medical practice, resulting in a more streamlined approach towards regulation of medical and healthcare industry. According to news reports, the Indian medical device sector is expected to reach USD 50 (fifty) billion by 2025, supported by various policies and schemes designed to facilitate this growth. Market experts predict that the healthcare sector will reach USD 320 (three hundred twenty) billion by 2028. The initiatives to boost medical industry through inter- alia marginal investment schemes are encouraging, especially considering India’s potential to leverage investments in the context of creating self- reliant India, with reduced support from imports.

At the regulatory front, the government has introduced stricter penalties for certain offences under for breach of rules the Food Safety and Standards Act, 2006. Further, considering the potential harm of tobacco products, the government has tightened its regulatory grip on the packaging of such products, requiring inter- alia clear depiction of warnings concerning use of such products.

Considering public centric regulatory amendments, the Central Drugs Standard Control Organization has been directed by the Ministry of Health and Family Welfare (“MoHFW”) to ensure prompt clearance of drug samples sent by foreign national regulatory authorities to avoid delays in testing and releasing safe, efficacious, and quality drugs for the population. Further, the Ministry of Ayush has introduced amendments to the procedural aspects including licensing, manufacturing and import process for new homeopathic medicines in India.

To streamline the processes concerning receipt of funds, the Ministry of Social Justice and Empowerment has released a checklist of documents required from NGOs and other organizations for the release of funds under the National Action Plan for Drug Demand Reduction (“NAPDDR”) scheme.

This edition of the JSA Healthcare Newsletter highlights the above key legal and regulatory developments introduced in November- December 2024, impacting the Indian healthcare sector.

Guidelines for verification of pharmacists profile with the ABHA Number to integrate them with the HPR

As a step forth to assimilate pharmacists with ABDM, the Pharmacy Council of India has issued guidelines to integrate pharmacists with the HPR by verifying their profiles using the ABHA Number. All existing registered pharmacists are required to verify their DIGI-PHARMed profiles with their ABHA Number within 45 (forty-five) days from November 20, 2024. Failure to complete the verification process will result in the deactivation of the pharmacist’s profile on the DIGI-PHARMed portal.

Further, new pharmacists are required to verify their accounts with the ABHA Number at the time of registration, as incomplete registrations without ABHA verificationis not acceptable under such guidelines.. Pharmacists without an ABHA Number are required to create one using their AADHAAR before registration.

Additionally, pharmacy institutions are also required to ensure that all faculty members have ABHA-verified profiles. Starting from the 2025–2026 academic session, only ABHA-verified profiles will be considered for standard inspection format applications and other references.

Operational guidelines for the Scheme for Strengthening of Medical Device Industry

To boost the manufacturing of the medical device industry in India and reduce its reliance on imports, the Department of Pharmaceuticals (“DoP”) has launched the Scheme for Strengthening of Medical Device Industry (“SSMDI”) following consultations and two Meditech Stackathons involving over 100 (one hundred) manufacturers. The SSMDI aims to reduce imports, enhance manufacturing capacity, ensure quality and safety, foster human resource development, and deepen the medical device supply chain in India.

The total outlay for the SSMDI is set at INR 500,00,00,000 (Indian Rupees five hundred crore) for the financial years 2024-25 to 2026-27. It focuses on the following 5 (five) components:

Common Facilities for Medical Device Clusters;
Marginal Investment Scheme for Reducing Import Dependence;
Capacity Building and Skill Development in Medical Device Sector;
Medical Device Clinical Studies Support Scheme; and
Medical Device Promotion Scheme.

To streamline compliance, the following 2 (two) pre-approved sub-schemes have been integrated to the SSMDI:

Assistance to Medical Device Clusters for Common Facilities; and
Human Resource Development in the Medical Device Sector.

To operationalize SSMDI, committees/ sub- bodies including Technical Committee, Scheme Steering Committee and Project Management Agency have been set- up for effective implementation of the scheme through assistance of officials and professionals at various levels. The overall outcome of the scheme will be periodically monitored by NITI Aayog.

The Food Safety and Standards (Amendment) Rules, 2024

On October 29, 2024, the MoHFW has notified the Food Safety and Standards (Amendment) Rules, 2024 amending the Food Safety and Standards Rules, 2011. Pursuant to the amendment, the Adjudicating Officer can now hold an inquiry for the purpose of adjudicating offences punishable under Section 61 (Punishment for false information) and Section 63 (Punishment for carrying out a business without licence) of the Food Safety and Standards Act, 2006.

The Cigarettes and Other Tobacco Products (Packaging and Labelling) Amendment Rules, 2024

On December 3, 2024, MoHFW has notified the Cigarettes and Other Tobacco Products (Packaging and Labelling) Amendment Rules, 2024 amending the Cigarettes and Other Tobacco Products (Packaging and Labelling) Rules, 2008. The amendments are in line with World Health Organization Framework Convention on Tobacco Control. While these may lead to manufacturers/ relevant stakeholders incurring additional costs of production, these have been issued in larger public interest.

The amendments introduce significant changes to enhance public awareness of the health risks associated with tobacco use. A new, enhanced, lucid and cautionary textual warning has been introduced for all tobacco product packages, including text encouraging cessation from tobacco products. Additionally, the inclusion of rotating pictorial warnings with new graphic images depicting the severe and often fatal health consequences of tobacco use has been mandated. These images are required by the amended law to be updated annually to ensure their continued impact and relevance. In order to ensure efficacy of the intended outcome, MoHFW has assured to provide digitally accessible versions of all the relevant health warnings to ensure the availability of the mandated pictorial representations and textual warnings at all times with manufacturers and other relevant stakeholders.

Shipment of drug samples sent by the foreign national regulatory authorities into India for test, examination and analysis

MoHFW has directed all port offices of the Central Drugs Standard Control Organisation to ensure prompt clearance of drug samples sent by foreign national regulatory authorities to avoid delays in testing and releasing safe, efficacious, and quality drugs for the population.

Pursuant to this circular, port offices are instructed to fast-track the clearance process, subject to the following conditions:

Authorised sender– Drug samples must be sent exclusively by the concerned foreign national regulatory authority.
Undertaking– Samples must be accompanied by an undertaking stating they have no commercial value and are intended solely for testing, examination, or analysis.
Licensed laboratory– Analysis must be conducted at a laboratory holding valid permission under Form-37.
Disposal of samples– Residual samples toned not be returned and must be disposed of by the testing laboratory in accordance with applicable procedures.

The Drugs (Fifth Amendment) Rules, 2024

On October 28, 2024, the Ministry of Ayush has notified the Drugs (Fifth Amendment) Rules, 2024 amending the Drugs Rules, 1945. The amendments introduce significant changes to the licensing, manufacturing and import process for new Ayurveda, Siddha, Unani and homeopathic medicines in India . It also introduces the concept of Sowa-Rigpa drugs.

Pursuant to the amendment, the term “New Homeopathic Medicines” is defined and it establishes a clear process for their important, licensing and manufacture. A new homeopathic medicine is considered as “new” for 5 (five) years following its first approval. An online application system, e-AUSHADHI portal, has been introduced to streamline various approvals.

Checklist for furnishing complete documents for seeking disbursement of funds under the National Action Plan for Drug Demand Reduction

The Ministry of Social Justice and Empowerment has released a checklist of documents required from NGOs and other organisations, such as the Integrated Rehabilitation Centres for Addicts, District De-Addiction Centres, Outreach and Drop In Centres and Community based Peer led Interventions, for the release of funds under the National Action Plan for Drug Demand Reduction (“NAPDDR”) scheme. In additional to carrying out education/ community engagement based and peer-to-peer awareness around drug and substance use, NAPDDR scheme aims to eradicate drug addition and to regulate and control the consumption of drugs and substance use through central and state action plans including integration of government bodies, non- government organizations, hospitals and addition treatment facilities.

Eligible entities seeking release of funds are advised to submit their proposals as per the checklist, in line with the guidelines of the NAPDDR scheme. Further, NGOs and voluntary organisations receiving financial assistance are encouraged to computerise the records of beneficiaries receiving benefits from the centre.

This Newsletter has been prepared by:

Sidharrth Shankar
Partner

Gaurav G Arora
Partner

Aditi Richa Tiwary
Associate

For more details, please contact [email protected].

Tags Healthcare, JSA, Leading Law Firm, Leading Lawyers, Legal Updates, Newsletter

Somerset Indus Capital’s investment in Cyrix Healthcare

JSA advised Somerset Indus Capital on picking up a significant minority stake in Kochi-based healthcare solutions provider Cyrix Healthcare. The transaction involved primary investments to aid the company’s expansion and secondary acquisition to give some liquidity to the company’s founders.

Our Transaction Team Comprised Lead Partner – Siddharth Mody, Partner – Anurag Shrivastav and Senior Associate – Alister Sequeira.

Tags Healthcare, Investment, JSA, Leading Law Firm, Leading Lawyers

JSA Newsletter | Healthcare | September and October 2024 Edition

Please click here to download the Newsletter as PDF.

This edition of the JSA healthcare newsletter focuses on the key developments undertaken in the Indian healthcare ecosystem in September and October 2024. Some of the major developments include introduction of the Uniform Code for Marketing Practices in Medical Devices 2024, which aims to curb unethical practices by medical device companies while promoting and marketing medical devices and the amended the New Drugs and Clinical Trials Rules, 2019 (“NDCT Rules”) that streamline the approval process for new drugs and clinical trials and align the procedural compliance more closely with international standards.

Regulatory updates

Uniform Code for Marketing Practices in Medical Devices 2024

On March 12, 2024, the Department of Pharmaceuticals (“DoP”) introduced the Uniform Code for Pharmaceutical Marketing Practices, 2024 bringing changes to the regulatory framework on pharmaceutical marketing practices. Subsequently, DoP, vide notification dated September 6, 2024, has issued the Uniform Code for Marketing Practices in Medical Devices 2024 (“UCMPMD”) to curb unethical practices by medical device companies while promoting and marketing medical devices. Some of the key provisions of the UCMPMD are as follows:

Claims and comparisons: All product claims must be in accordance with the terms of the document submitted for obtaining product registration. Comparisons of medical devices must be factual, fair and capable of substantiation and not disparaging of other companies’ products, services or promotions.
Text and audio-visual presentation: Certain minimum information must be provided on all promotional materials such as name and address of the manufacturer/importer and warnings and precautions for use. The names and photographs of Healthcare Professionals (“HCPs”) must not be used in promotional materials.
Medical Representatives (“MRs”): The term MR is defined to include personnel retained by way of contract with third parties. MRs cannot employ any inducement or subterfuge to gain an interview or pay for access with an HCP. Companies are responsible for the activities of MRs and must include a clause in the employment contract with an MR to ensure compliance with the UCMPMD.
Evaluation samples and demonstration products: The UCMPMD also prescribes conditions regarding evaluation samples (such as free evaluation sample must not be provided to anyone other than HCPs) and demonstration products (which should be solely for demonstration purposes and not patient use).
Continuing medical education and research: The medical device industry must engage with HCPs for continuing medical education and professional development through a well-defined, transparent, and verifiable set of procedures. Events in foreign locations are prohibited except for advanced clinical training in exceptional cases. Any study or research should have approval from the competent authority such as ICMR and DCGI.
Relationship with HCPs: No gift or pecuniary advantage or benefit in kind should be offered or provided for personal benefit of any HCP or family member by any medical device company or its agent. Providing travel and hospitality facilities are also prohibited unless the person is a speaker or participant at a training participants for which specific approval is obtained from DoP.
Complaints: All the Indian Medical Device Associations should upload the UCMPMD on their website along with the detailed procedure for lodging of complaints, which will be linked to the UCPMP portal of the DoP. All complaints related to the breach of the UCMPMD should be addressed to the ‘Ethics Committee for Marketing Practices in Medical Device’, ‘Chief Executive Officer’, and ‘Name of Association’. Complaints must be made within 6 (six) months of the alleged breach, with another 6 (six) months for reasonable delay that can be explained in writing. The respondent company must submit its comments and documents within 30 (thirty) days of receipt of notice from the committee. The committee must give its decision within 90 (ninety) days of receipt of complaint.
Penalties: Once it is established that a breach of the UCMPMD has been made by an entity, the committee can propose one of the following actions against the erring entity: (a) to suspend or expel the entity from the respective Association; (b) to reprimand the entity and publish full details of such reprimand; (c) to require the entity to issue a corrective statement in the same media which was used to issue textual or audio-visual promotional material; (d) to ask the entity to recover money or items, given in violation of the UCMPMD, from the concerned person/s; and (e) in cases where disciplinary, penal, or remedial action lies within the domain of any agency or authority of the Government, the committee may send its recommendations to such agency or authority through DoP.

Nationwide extension of provision for instant (tatkal) issuance of license/ registration in certain categories of food businesses

The Food Safety and Standards Authority of India (“FSSAI”), vide notification dated July 1, 2024, enabled instant issuances of licenses/registrations under the Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011, for specific categories in the States/Union Territories of Assam, Delhi, Gujarat, Jammu and Kashmir, and Kerala. FSSAI, vide notification dated September 11, 2024, has extended this provision nationwide excluding the States/Union Territories of Chandigarh, Himachal Pradesh, and Meghalaya. The provision will be implemented in these States/Union Territories after incorporating State-specific requirements. Further, the issuance of licenses/registrations will continue to be subject to the conditions as prescribed under the primary notification dated July 1, 2024, for specific categories such as wholesalers, distributors, retailers, transporters, storage without atmospheric control, importers, food vending agencies, direct sellers, merchant exporters, petty retailers of snacks/tea shops and hawkers (itinerant/mobile food vendors).

Reduction in testing fee for PAN-India surveillance

FSSAI exclusively conducts PAN-India surveillance programs on food products to gather data for food safety monitoring, risk assessment, identifying hotspots of adulteration, and setting standards. These nationwide surveillance activities are carried out extensively, with samples collected from both the organised and unorganised sectors across all districts in the 36 (thirty six) States/Union Territories. FSSAI, vide Order dated September 11, 2024, has reduced the testing fee for all food categories by 50% for PAN-India surveillance.

Modification to the guidelines for the scheme on strengthening of pharmaceuticals industry

DoP, vide notification dated September 17, 2024, has amended the guidelines for the scheme on Strengthening of Pharmaceuticals Industry by amending the sub-scheme on Revamped Pharmaceutical Technology Upgradation Assistance Scheme. . The key changes are as follows:

incentives of pharmaceutical units under the scheme are revised to INR 2,00,00,000(Indian Rupees two crore) (earlier this was INR 1,00,00,000 (Indian Rupees one crore)) while the average turnover criteria remain the same;
expenditure incurred on production equipment items will also be considered for calculation of subsidy amount to pharmaceutical units;
the requirement for a detailed gap analysis for online application for the sub-scheme is removed and replaced with a simple gap analysis; and
the subsidy amount that can be released to applicants is modified. Earlier, 50% of the eligible amount could be released to the applicant within 30 (thirty) days of obtaining requisite documents, which was subject to an upper limit of INR 50,00,000 (Indian Rupees fifty lakh) for the first instalment and INR 1,00,00,000 (Indian Rupees one crore) for the second and final instalment. This is now revised to INR 1,00,00,000 (Indian Rupees one crore) and INR 2,00,00,000 (Indian Rupees two crore) respectively.

New Drugs and Clinical Trials (Amendment) Rules, 2024.

The Ministry of Health and Family Welfare (“MoHFW”), vide notification dated September 19, 2024, has notified the New Drugs and Clinical Trials (Amendment) Rules, 2024 (“NDCT Rules Amendment”) amending the NDCT Rules. They come into effect on and from April 1, 2025. It incorporates provisions relating to the registration of Clinical Research Organisations (“CROs”). Some of the key amendments are as follows:

Definition of CRO: The term CRO is defined to mean the sponsor or a body, commercial or academic or of other category, owned by an individual or an organisation having status of legal entity by whatsoever name called, to which the sponsor may, delegate or transfer in writing, some or all of the tasks, duties or obligations regarding clinical trial or bioavailability or bioequivalence study.
Registration of CROs: CROs are required to obtain registration from the Central Licensing Authority (“CLA”) before conducting any clinical trials or bioavailability and bioequivalence studies involving new or investigational drugs on human subjects. However, centres that are already registered for conducting bioavailability or bioequivalence studies under the NDCT Rules are deemed to be registered as CROs.
Validity of registration: The registration for CROs is valid for 5 (five) years from the date of its grant, unless suspended or cancelled earlier.

Validity of FSSAI recognised food testing laboratories

FSSAI, vide notification dated September 24, 2024, has issued a list of FSSAI recognised laboratories along with the validity of their national Accreditation Board for Testing and Calibration Laboratories accreditation and their respective contact details. These laboratories carry out the analysis of food samples taken under the Food Safety and Standards Act, 2006 and rules and regulations made there under.

Modification to the Production Linked Incentive Scheme for Bulk Drugs

DoP, vide corrigendum dated September 25, 2024, has amended the term ‘Successor-in-interest’ to include a wholly owned subsidiary of an applicant. Prior to the amendment, the term ‘Successor-in-interest’ was defined to mean the new or reorganised entity formed after the merger, de-merger, acquisition, transfer of business or significant change in ownership of an applicant. Pursuant to the amendment, the transfer of business to any entity including the wholly owned subsidiary of the applicant is permitted.

Food Safety and Standards (Amendment) Rules, 2024

MoHFW, vide notification dated October 29, 2024, has amended the Food Safety and Standards Rules, 2011 to give power to the adjudicating officer to hold an inquiry for purpose of adjudicating offences punishable under Sections 58 (penalty for contraventions for which no specific penalty is provided), 61 (punishment for false information), and 63 (punishment for carrying out a business without FSSAI licence) of the Food Safety and Standards Act, 2006.

Case laws

Kerala High Court rules in the favour of nurse in the case of malicious medical negligence cases filed against them

The Kerala High Court, in the case of Celinamol Mathew vs. State of Kerala[1], has opined that nurses in Government service and in private hospitals should also get protection like the doctors and that private complaints should not be entertained by courts against nurses unless the complainant gives prima facie evidence in the form of expert opinion to support their case of medical negligence. Further, the court stated that nurses should be given moral support by the society and Government. They should be allowed to work without fear of any prosecution and let them be known as Indian nursing nightingales.

National Consumer Disputes Redressal Commission has held that expert medical evidence is crucial for determining medical negligence

The National Consumer Disputes Redressal Commission, New Delhi, in the case of Chief Medical Officer Nehru Satabdi Central Hospital and Ors. vs. Puja Sahu[2], set aside the orders by the District and State Commission by stating that the thumb amputation done by the hospital resulted due to the thread tied by the complainant’s parents. The complainant who was admitted to the hospital to get a treatment for a snake bite was brought in with a thread tied to his thumb. Since the thread was tied by the parents of the complainant and not the hospital and since no expert opinion established hospital’s negligence, the hospital could not be held responsible.

Interesting reads

Ambitious reforms in healthcare and education for a resilient future

The Government has unveiled a series of groundbreaking initiatives designed to strengthen the nation’s healthcare and education sectors. The programs focus on improving healthcare accessibility, medical education, research, and technological advancement. Some of the major initiatives include the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana for senior citizens and launching of innovative platforms like the U-WIN Portal for digitised vaccination services. Further, initiatives like the establishment of the National Medical Register Portal, the creation of 75,000 (seventy five thousand) new medical seats, the Vigyan Dhara scheme introduced to promote scientific research, innovation, and technological development and other policy reforms in cancer treatment and biotechnology reflect a long-term vision to create a self-reliant and resilient nation.

Inauguration of various health infrastructure projects

With an aim to strengthen India’s healthcare infrastructure and providing quality healthcare services across the country, Prime Minister Narendra Modi inaugurated and laid the foundation stone of several health infrastructure projects, and launched various health programmes at an event at All India Institute of Ayurveda on October 29, 2024. The total outlay of these projects amounts to more than INR 12,855 crore (Indian Rupees twelve thousand eight hundred fifty-five crore).

Unethical and false presentation by Entod Pharmaceuticals on PresVu eye drops

Entod Pharmaceuticals had made several unapproved claims for its PresVu eye drops stating that it could reduce the dependency on reading glasses for individuals suffering from presbyopia, which is an age-related vision condition. The Directorate General of Health Services under the Central Drugs Standard Control Organisation has identified that the company has several misleading claims basis which it has suspended Entod Pharmaceuticals Limited’s licence to manufacture and market Pilocarpine Hydrochloride Ophthalmic Solution USP 1.25% w/v, branded as PresVu.

This Newsletter has been prepared by:

Sidharrth Shankar
Partner

Prakriti Jaiswal
Partner

For more details, please contact [email protected]

[1] CRL.MC NO. 5401 OF 2018

[2] Revision Petition No. 1353 OF 2022 (against the order dated July 22, 2022, in Appeal No. 156/2000 of the State Commission Orissa)

Tags Drugs, Healthcare, JSA, Leading Law Firm, Leading Lawyers, Medical, Newsletter

Avendus Future Leaders Fund II including certain other investors acquire stake in Sagility India ahead of its IPO

JSA advised Avendus Future Leaders Fund II (Avendus) and certain other investors in relation to their acquisition of a part of the promoter’s stake (i.e., Sagility B.V., an affiliate of EQT Private Capital Asia) in Sagility India Limited (Sagility India).

The initial public offering (IPO) of Sagility India was recently opened, and the above stake sale of the promoter to the investors (which included Avendus, Adani Properties Private Limited, Elpro International Limited etc.) was undertaken ahead of the opening of Sagility India’s IPO.

Sagility India is engaged in providing technology enabled healthcare solutions and services to payers (U.S. health insurance companies) as well as providers (hospitals, physicians, and diagnostic and medical devices companies), encompassing their operational and administrative functions, clinical services and revenue cycle management services.

Our transaction team comprises Lead Partner – Sidharrth Shankar, Partner – Prakriti Jaiswal, Senior Associate – Rishika Agarwal, and Associate – Mahi Jaiswal.

Tags Acquisition, Healthcare, JSA, Leading Law Firm, Leading Lawyers

JSA Newsletter | Healthcare | July and August 2024 Edition

Please click here to download the Newsletter as a PDF.

This edition of the JSA healthcare newsletter focuses on the key developments undertaken in the Indian healthcare ecosystem in July and August 2024.

Regulatory updates

Launch of provision for instant (tatkal) issuances of licenses/registrations in certain categories of food businesses

The Food Safety and Standards Authority of India (“FSSAI”), vide notification dated July 1, 2024, has enabled instant issuances of licenses/registrations under the Food Safety and Standards (Licensing and Registration of Food Businesses) Regulations, 2011, for specific categories. These include wholesalers, distributors, retailers, transporters, storage without atmospheric control, importers, food vending agencies, direct sellers and merchant-exporters. It is subject to key changes (and conditions) with respect to the existing procedure, such as:

it will be only applicable for prescribed Kind of Businesses (“KoB”) and certain food product categories within the KoB;
for proprietorship firms, the digital verification will be done through Goods and Services Tax (“GST”) and AADHAAR and for partnership/registered firms through corporate identification number/GST and AADHAAR;
the applicant will be required to declare that: ‘He/she does not possess the valid license/registration at the same premises or his/her license/registration has not been suspended or cancelled by the authorities in past 3 (three) months’;
the applicant will be required to upload photographs of the unit, specifically including images of the entrance/front facing of the unit;
the validity of instant license/registration will be 1 (one) year and it can be renewed post that as per the renewal procedure; and
the applicants will be required to pay the entire annual fee for license/registration during filing of application.

The instant issuance of license/registration (except for the partnership/registered firms requiring digital verification through GST and AADHAAR) is being rolled out in the States/Union Territories of Assam, Delhi, Gujarat, Jammu and Kashmir, and Kerala from June 28, 2024.

Display of nutritional information labelling of total sugar, salt and saturated fat

FSSAI, in its 44^th meeting on July 6, 2024, approved the proposal to amend the Food Safety and Standards (Labelling and Display) Regulations, 2020 with respect to displaying nutritional information regarding total sugar, salt and saturated fat in bold letters and relatively increased font size on labels of packaged food items.

Validity of FSSAI recognised food testing laboratories

FSSAI, vide notification dated July 11, 2024, has issued a list of FSSAI recognised laboratories along with the validity of their National Accreditation Board for Testing and Calibration Laboratories accreditation and their respective contact details. These laboratories carry out the analysis of food samples taken under the Food Safety and Standards Act, 2006 and rules and regulations made there under.

Re-operationalisation of Food Safety and Standards (Licensing and Registration of Food Business) Amendment Regulations, 2021

FSSAI had approved the draft Food Safety and Standards (Licensing and Registration of Food Business) Regulations, 2018 (“FSS 2018 Regulations”) on September 21, 2017, pursuant to which they were notified for comments from stakeholders. Pending finalisation of the FSS 2018 Regulations, FSSAI had issued and operationalised the Food Safety and Standards (Licensing and Registration of Food Business) Amendment Regulations, 2021 to ensure food safety and fair practices in food business operations. Since the FSS 2018 Regulations are yet to be finalised and notified, FSSAI, vide a direction dated July 19, 2024, has re-operationalised the Food Safety and Standards (Licensing and Registration of Food Business) Amendment Regulations, 2021 with effect from May 11, 2024.

Omission of Regulation 7(4) of the Food Safety and Standards (Fortification of Foods) Regulations, 2018

FSSAI, vide a direction dated July 19, 2024, has omitted Regulation 7(4) of the Food Safety and Standards (Fortification of Foods) Regulations, 2018. Accordingly, packages of food, fortified with iron can no longer carry the following statement: “People with thalassemia may take under medical supervision and persons with sickle cell anaemia are advised not to consume iron fortified food products”.

Re-operationalisation of certain provisions of the Draft Food Safety and Standards (Food Product Standards and Food Additives) Amendment Regulations, 2021

FSSAI, vide a direction dated May 30, 2022, had operationalised certain provisions of the draft Food Safety and Standards (Food Product Standards and Food Additives) Amendment Regulations, 2021 with respect to the permissible limits of total dissolved solids, calcium and magnesium in packaged drinking water. The final amendment regulations have been approved by FSSAI but are yet to be notified. To allow Food Business Operators (“FBOs”) to formulate packaged drinking water, FSSAI, vide a direction dated July 26, 2024, has re-operationalised the said provisions of the amendment regulations with effect from July 1, 2024.

Clarification regarding selling/marketing of fruit juices with nonstandardised ingredients

FSSAI has noted that few manufacturers are adding non-standardised ingredients such as ‘deionized apple juice concentrate’ in their fruit juices which is not a permitted ingredient under various food safety and standards regulations such as the Food Safety and Standards (Advertising and Claims) Regulations, 2018 and Food Safety and Standards (Labelling and Display) Regulations, 2020. Consequently, FSSAI, vide advisory dated July 31, 2024, has advised the FBOs to obtain approval of such non specified food/ingredients under the Food Safety and Standards (Approval for Non-Specific Food and Food Ingredients) Regulation, 2017.

Extension of enrolment of non-food production units for collection of used cooking oil from FBO

FSSAI, vide its circular dated August 5, 2024, has extended the validity of the provisional enrolment of the prescribed 50 (fifty) non- food production units[1] for collection of used cooking oil from FBOs up to July 31, 2025, or till the registration mechanism in the State/Union Territories gets devised.

Applications for registration and import of cosmetics through SUGAM on-line portal

The Central Drugs Standard Control Organisation (“CDSCO”) through its SUGAM on-line portal[2] receives various applications for registration and import of cosmetics (including applications for post approval changes).To streamline the application process, CDSCO, vide circular dated August 9, 2024, has decided to restrict the number of products per application to a maximum of 50 (fifty). However, multiple applications are allowed. The said restriction is implemented with effect from August 16, 2024.

Advisory for all medical colleges and institutions for ensuring safe work place environment

The National Medical Commission (“NMC”), vide public notice dated August 13, 2024, issued an advisory for all medical colleges and institutions requesting them to develop a policy for safe work environment within the college and hospital campus for all the staff members including faculty, medical students and resident doctors. The policy should ensure adequate safety measures at OPD, wards, casualty, hostels and other open areas in the campus and residential quarters. Further, any incident of violence against the medical students should be promptly investigated by the college management and an first information report should be lodged with the police. A detailed action taken report on any incident of violence should invariably be sent to the NMC within 48 (forty-eight) hours of the incident.

Selling/marketing of reconstituted fruit juices as ‘100% Fruit Juice’

FSSAI, vide its advisory dated August 14, 2024, has extended the deadline provided in its advisory dated June 3, 2024,. FSSAI has now required all FBOs to exhaust all existing pre-printed packaged reconstituted fruit juices labelled as “100% Fruit Juice” by December 31, 2024 (earlier this was August 31, 2024). Further, products manufactured by FBOs before December 31, 2024, are allowed to be sold in the market across all channels until the end of their shelf life.

Sensitisation of food testing laboratories mapped on food import clearance system portal

FSSAI has noted that the food testing laboratories whilst testing of import samples have been making inadvertent mistakes while uploading test reports of import samples on the Food Import Clearance System (“FICS”) portal.[3] This creates unnecessary hindrances in the clearance of import consignments. To address this, FSSAI, vide its advisory dated August 16, 2024, has directed the laboratories mapped on the FICS portal to conduct due diligence on the following:

the sample must be tested and the test reports must be generated and uploaded on FICS portal within 5 (five) days as stipulated under Regulation 9 (12) of Food Safety and Standards (Import) Regulations, 2017;
the entries such as test parameters, food product category, FSSR limits, result string must be verified before final submission of test reports on FICS portal. The test result, i.e., ‘Pass/Fail’ status must be verified with the test report uploaded on FICS portal of the relevant sample;
before final submission of the test report, it must be ensured that the wrong test report is not uploaded and the test report uploaded is of the respective sample;
test reports must be uploaded in FORM-2 on FICS portal as per Food Safety and Standards (Import) Regulation, 2017 with NABL symbol;
the samples which are not covered under the NABL scope of accreditation of the laboratory must not be accepted;
only the validated and accredited methods must be adopted for testing of food samples by the laboratory;
the test report should be signed by a food analyst duly appointed as per the requirement of Rule 2.1.4 (1) of the Food Safety and Standards Rules, 2011; and
in case of any delay in completion of testing of the import samples, the laboratory must inform it to the authorised officer as mentioned under Regulation 9 (13) of Food Safety and Standards (Import) Regulations, 2017.

Jan Vishwas (Amendment of Provisions) Act, 2023

The Ministry of Health and Family Welfare (“MoHFW”), vide notification dated August 19, 2024, has appointed December 31, 2024, as the date on which the provisions of the Jan Vishwas (Amendment of Provisions) Act, 2023 with respect to the Pharmacy Act, 1948 (“Pharmacy Act”), will come into force.

Some of the key provisions with respect to the Pharmacy Act that would be amended under the Jan Vishwas (Amendment of Provisions) Act, 2023, are detailed below:

Section	Existing Provision	Amendment
Section 18(2)	As per Section 18(2), the Central Council may, with the approval of the Central Government by notification in the Official Gazette make regulations consistent with purpose of the Pharmacy Act and such regulations must provide for specific procedures, powers and duties.	Insertion of new sub-sections (i) and (j) for framing of regulations for holding inquiry and penalty under Section 43Aand form and manner of preferring an appeal under Section 43A respectively. Section 43A is a new provision which has been inserted for adjudication of penalties.
Section 26A(3)	Under Section 26A (3), any person that obstructs an Inspector in the exercise of his powers, must be punishable with imprisonment of up to 6 months or with fine up to INR 1,000, or with both.	The punishment of imprisonment is proposed to be removed. The penalty for obstructing an inspector while exercising powers in line with the Pharmacy Act, enhanced to INR 100,000.
Section 41(1)	Any person whose name is not entered in the register of pharmacists, falsely pretends that it has been entered, must be punishable with fine of up to INR 500 on first conviction, and on continuing contravention with imprisonment of up to 6 months or with a fine of maximum INR 1,000 or both.	The first conviction is punishable with maximum fine INR 1,00,000 and subsequent contravention is punishable with imprisonment up to 3 months or with maximum fine up to INR 2,00,000 or with both imprisonment and fine.
Section 42(2)	Dispensing by unregistered person is punishable with maximum 6 months imprisonment, or with fine up to INR 1,000, or with both.	Dispensing by unregistered person is punishable with maximum 3 months imprisonment, or with fine up to INR 200,000, or with both fine and imprisonment.
Section 43A		A new provision (Section 43A) has been inserted for adjudication of penalties under Section 26A. The President of the State Council is authorised as an adjudicating officer for holding inquiry and imposing penalties.

Withdrawal of advisory on selling/marketing of milk and milk products such as ghee, milk in the name of Al and A2

FSSAI, vide its order dated August 21, 2024, had instructed all e-commerce FBOs claiming to sell their milk and milk related products in the name of A1 and A2 under FSSAI license number and/or registration certificate number, to remove such claims from their websites. However, FSSAI vide its order dated August 26, 2024, has withdrawn the aforesaid advisory.

Re-operationalisation of certain provisions of the Draft Food Safety and Standards (Health Supplements, Nutraceuticals, Food for Special Dietary Use, Food for Special Medical Purpose and Prebiotic and Probiotic Food) Amendment Regulations, 2022

FSSAI, vide a direction dated March 29, 2022, overhauled the Food Safety and Standards (Health Supplements, Nutraceuticals, Food for Special Dietary Use, Food for Special Medical Purpose, Functional Food and Novel Food) Regulations, 2016, and framed the draft Food Safety and Standards (Health Supplements, Nutraceuticals, Food for Special Dietary Use, Food for Special Medical Purpose and Prebiotic and Probiotic Food) Regulations, 2022 (“Draft 2022 Regulations”). Pending finalisation of the Draft 2022 Regulations, FSSAI had operationalised certain provisions with effect from April 1, 2022. Since these are yet to be finalised, FSSAI, vide a direction dated August 30, 2024, has re-operationalised the said provisions of the Draft 2022 Regulations with effect from July 1, 2024.

Case laws

Supreme Court upholds the Delhi High Court decision against Sun Pharma for overpricing medicine

The Supreme Court of India (“Supreme Court”), in the case of Sun Pharmaceutical Industries Ltd. vs. Union of India and Others,[4] has upheld the recovery demand issued by the National Pharmaceutical Pricing Authority against Sun Pharmaceutical Industries Limited for selling overpriced drugs. The Supreme Court also stated that the purpose of Drugs (Price Control) Order, 1995 is to control prices of medicinal drugs for the common man, and it cannot be subjected to a narrow interpretation.

Supreme Court directs Centre regarding implementation of National Commission for Allied and Healthcare Professions Act, 2021

The Supreme Court, in the case of Joint Forum of Medical Technologists of India (Jfmti) and Others vs. Union of India and Others,[5] has directed the Union Government and the respective State Governments to take necessary steps to implement the provisions of the National Commission for Allied and Healthcare Professions Act, 2021, on or before October 12, 2024. Further, the Secretary of MoHFW was directed to convene an online meeting within a period of 2 (two) weeks from the date of this order, with all the State secretaries of MoHFW to lay down a road map for implementing the provisions of the National Commission for Allied and Healthcare Professions Act, 2021.

Formation of ‘National Task Force’ by the Supreme Court for medical professionals’ safety

The Supreme Court has issued an order [6] in the suo motu case taken over the rape and murder of a trainee doctor at the RG Kar Medical College Hospital, Kolkata, ordering the formation of a ‘National Task Force’ to give recommendations on the modalities to be followed all over the country to ensure the safety and well-being of medical professionals.

National Consumer Disputes Redressal Commission: If a doctor follows an acceptable practice, they are not liable for negligence

The National Consumer Disputes Redressal Commission, in the case of Sri Balaji Action Medical Institute vs. Tilak Raj Sikri,[7] held that a lack of care or an error in judgment does not automatically prove negligence. If the doctors have followed an acceptable practice they are not liable for negligence, even if a better alternative exists.

Interesting Reads

Standard operating procedure for prescription writing

The Employee State Insurance Corporation (“ESIC”) has formulated the Standard Operating Procedure (“SOP”) for prescription writing to enhance healthcare quality and patient safety while achieving therapeutic goals within the ESIC. The SOP serves as a comprehensive guide for ESIC doctors using the Dhanwantri module, ensuring standardised, clear, and patient specific prescriptions.

Union Ministers of State for Health and Family Welfare, Shri Prataprao Ganpatrao Jadhav and Smt. Anupriya Singh Patel, unveil 3 (three) initiatives

The initiatives aim to improve the quality of healthcare services and promoting the ease of doing business in India. The Union Ministers have launched, a virtual ‘National Quality Assurance Standards’ assessment for Ayushman Arogya Mandirs; a dashboard which will help national, state and district health institutions and facilities in quickly monitoring compliance with respect to Indian public health standards and taking actions accordingly; and a spot food licence and registration initiative for food vendors.

Research update on the new strains of communicable diseases

The Prime Minister’s Science, Technology, and Innovation Advisory Council has reviewed the ongoing activities for pandemic preparedness across agencies and recognised the need for a unified effort in pandemic preparedness through the initiative of National One Health Mission (“NOHM“), to address the gaps and enhance coordination among multiple sectors. The mission is a collaborative effort of 13 (thirteen) ministries/departments to realise the objectives of the NOHM, which is steered by the Office of the Principal Scientific Advisor to the Government of India along with other key stakeholders.

Series of digital initiatives launched to streamline pharmaceutical regulations

CDSCO has launched a series of digital initiatives aimed at revolutionising the pharmaceutical regulatory framework in India. These initiatives, showcased at the ‘iPHEX 2024’ event, are designed to enhance transparency, improve efficiency, and ensure the highest standards of safety and quality in the pharmaceutical sector. The key initiatives include:

National Single Window System (“NSWS”): The NSWS aims to provide a unified platform for all regulatory approvals at the national level, minimising the need for multiple interfaces and ensuring a more streamlined process for the industry. While the system is currently partially implemented for medical devices and clinical trials, a phased rollout is planned for other licenses;
Online National Drug License System: Branded as the ‘One Nation-One Drug Licensing System’, this initiative offers a digital portal managed by CDSCO for uniform drug licensing across all States and Union Territories. It standardises requirements and interpretations, maintains a comprehensive database of licenses, and enables prompt verification, ensuring no discrepancies or anomalies in the licensing process; and
Track and Trace System: This system is being introduced to ensure the traceability of Active Pharmaceutical Ingredients (“APIs”) and top formulations. Quick response (QR) codes or barcodes will be used for all APIs imported or manufactured in the country, starting with the top 300 (three hundred) brands of formulations. Future phases will extend this to all remaining formulations, vaccines, and narcotic drugs.

This Newsletter has been prepared by:

Sidharrth Shankar
Partner

Dhruv Malhotra
Principal Associate

For more details, please contact [email protected].

[1] Non-food production units refer to company or production units involved in preparation of non-food products such as biodiesel, candles, soaps, lubricant, etc. in which used cooking oil is used as an ingredient.

[2] SUGAM portal is an online web portal where applicants can apply for no objection certificates, licenses, registration certificates, permissions and approvals under the Drugs and Cosmetics Acts, 1940. It provides an online interface for applicants to track their applications, respond to queries and download the permissions issued by CDSCO. It also enables CDSCO officials to process the applications online and generate the permissions online and generate management information system reports.

[3] The FICS portal is an online food regulatory portal which is integrated with the customs ICEGate (i.e Indian Customs Electronic Commerce/Electronic Data Interchange Gateway) portal to facilitate trade, provides an opportunity to importers to file an application for easy clearance of food consignments.

[4] 2024 LiveLaw (SC) 487

[5] W.P.(C) No. 983/2023

[6] SMW (Crl) No 2 of 2024

[7] F.A. No. 1882/2018

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Introduction

Guidelines for verification of pharmacists profile with the ABHA Number to integrate them with the HPR

Operational guidelines for the Scheme for Strengthening of Medical Device Industry

The Food Safety and Standards (Amendment) Rules, 2024

The Cigarettes and Other Tobacco Products (Packaging and Labelling) Amendment Rules, 2024

Shipment of drug samples sent by the foreign national regulatory authorities into India for test, examination and analysis

The Drugs (Fifth Amendment) Rules, 2024

Checklist for furnishing complete documents for seeking disbursement of funds under the National Action Plan for Drug Demand Reduction

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