NCPA - National Center for Policy Analysis

Quality of Non-Domestic Generic Drugs

March 3, 2014

The U.S. Food and Drug Administration (FDA) issued reports over the last year that foreign drug producers were falsifying data pertaining to the quality of their medicines. Warning letters were issued to companies in Mexico, Poland, the United Arab Emirates, India and Canada dealing with drug quality. A reported 54 percent and 70 percent of Americans distrust Indian and Chinese drugs, respectively, says Roger Bate, a visiting scholar at the American Enterprise Institute.

To sell generics in the United States, manufacturers must show the FDA that their drugs work just as well as the original. But after that approval, some producers are reportedly failing to continue meeting that standard. Sometimes it can be difficult to spot these problems. When an inferior product -- that was also an allergen -- was substituted for heparin by a Chinese producer, it passed all tests at the American manufacturer. It took 149 American deaths before a more complex test was developed to detect the counterfeit ingredient.

Generic drug producers in India are especially known for cutting costs by using less expensive ingredients and failing to use good manufacturing practices. Incidentally, India exports more finished products to the United States than does any other emerging market.

  • One manufacturer, Ranbaxy, was accused of cutting corners in its production of HIV medication in 2005. In the course of the investigation, the United States identified two questionable plants and 30 questionable medications. Bate notes that his own investigation of the issue found that midlevel managers often broke quality-control protocol under pressure to cut costs.
  • Ranbaxy was issued the sole license for the manufacture of a generic version of Lipitor in 2011. The company had to recall its drug because of possible glass particles in the medicine last November.
  • India's own government issued a report that accused the Central Drugs Standard Control Organization (India's version of the FDA) as rife with corruption, saying that so-called "independent" expert health opinions on drug product safety "were actually written by the invisible hands of drug manufacturers."

Many on the left, Bate says, support Indian drugs, yet they are the same people who would be horrified if American or European companies had as little oversight as do the Indian companies. How can the United States ensure that drug producers in countries with poor domestic oversight produce good-quality drugs consistently? Bate argues for the implementation of sanctions against companies that produce poor-quality products, as well as for U.S. importers of those products.

Source: Roger Bate, "Cheap Indian Generic Drugs: Not Such Good Value After All?" American Enterprise Institute, February 19, 2013.


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