Global tenders for vaccines: Regulatory roadblocks

The second wave of COVID-19 in India has compelled many State governments (Maharashtra, Tamil Nadu, Odisha, Andhra Pradesh, Delhi etc) to consider global procurement of vaccines, to augment the crippling shortage of vaccines created as a result of the present “liberalized” policy of vaccine distribution effected by the Central government.

The pitfalls of the present “liberalized” policy, by which the Central government is able to control the extent of procurement by State governments, are well-documented. The Central government is able to control the extent of direct procurement by state governments from vaccine manufacturers in India, by determining the state’s requirement based on a pro-rata calculation of the population. This is done to ensure there is “parity of bargaining power” among states.

Aggravating this interference is the mandatory requirement of State governments to ensure that 50% of such procurement is diverted to private hospitals, thereby further curtailing their autonomy to draft their region-specific plan to deal with the pandemic.

Ideally, in such circumstances, the distribution should predominantly be through a public health network to ensure an equitable spread. The mandatory requirement on states to overwhelmingly depend on their private sector defies any logic. This assumes that the private hospital infrastructure in India is so well-spread and entrenched that it is vital for vaccination, which is far from the truth outside of metropolitan limits. The trappings of such requirements eventually have the effect of a centralized scheme of procurement, and the interference by the Central government in the procurement mechanism of States remains largely unabated.

The idea of floating global tenders by states is to circumvent such limits on domestic procurement, but the regulatory hurdles imposed by the Central government on imports would negate such objective. It is needless to state that the primary idea behind floating global tenders is to immediately increase every state’s stockpile of vaccines. Given the fact that a vast spectrum of manufacturers across the globe, such as Pfizer, Moderna and Johnson & Johnson, have gone through regulatory rigor in various western countries, and have been approved by the World Health Organization (WHO), one would assume that these drugs could be easily imported for use in India. This, however, is far from the regulatory reality in India today. Various prominent manufacturers including Pfizer have confirmed that they do not have the regulatory approval for import into India, despite an “emergency” approval scheme being effected by the Central government and their application has been pending for several months.

The Central government’s notification dated April 15, 2021 prescribes the following:

1. It is prescribed that an application for vaccines which are already approved for use in US, UK and Japan can be made by a foreign manufacturer through its Indian subsidiary. It can also be filed through an authorized agent in India in case a company does not have an Indian subsidiary. Given the mandatory involvement of a domestic entity for every foreign vaccine, the State governments cannot procure directly from foreign manufacturers, and any procurement from a domestic entity may be subject to the Central government’s mandates on the extent of state procurement.

2. Secondly, after such application has been made through a domestic entity, the Central Drugs Standard Control Organization (CDSCO) will process such applications for restricted use and will take a decision within 3 working days.

3. Such application for restricted use must be accompanied by applications for bridging trial protocol, application for import registration certificate and application for import license. These are, needless to say, extremely elaborate, and are in effect over a hundred documents.

4. If all these applications are found to be in order, the vaccine would be tested at the Central Drugs Laboratory (CDL), Kasauli.

5. If the testing is found to be in order, the applicant will granted permission for restricted use of the vaccine initially only on 100 beneficiaries and submit the safety data to CDSCO.

6. After such testing on 100 beneficiaries is completed, CDSCO will review the safety data submitted by the applicant and once satisfied will authorize the applicant to use the vaccine.

7. Lastly, such approval will be subject to a post approval “bridging trial protocol”, which data will be reviewed by Drugs Controller General of India (DCGI) to confirm the emergency approval.

It is, therefore, obvious that a global tender floated by any state government would qualify only those bidders who have these approvals or are willing to go through the above process. These requirements have presently only been met for the Sputnik vaccine through Dr. Reddy’s labs in India. Therefore, even if other manufacturers abroad have stock that they are willing to supply directly to state governments, unless they are amenable to go through the above approval route, they cannot be utilized.

The loss of time in obtaining such approvals is also critical in India, as even a 15 or 30 day delay due to regulations can potentially cause loss of thousands of lives. There is also the issue of whether at all such manufacturers are willing to undergo such regulatory conditions for supplying to State governments, as they have other markets across the globe who do not impose such requirement.

Countries such as Singapore and Dubai have had approvals in place for import of vaccines since December 2020, largely relying upon testing in other western countries and WHO approvals. The situation in India has however, taken a turn from “gifting” lakhs of vaccines across the globe, to scrambling for importing vaccines today. Many manufacturers such as Moderna have presently shown no interest in undergoing such process in India, and are therefore, shut-off as options for State governments.

The critical question today is whether such convoluted approvals are required for pressing emergency use by states, when approvals have already been granted in various other countries across the globe. I believe it would be far better to have a mechanism that allows for import and immediate use of vaccines approved by regulators of repute such as the USFDA or EMA, and the WHO. These can be followed by a post-import testing of samples in India, if required. The mechanism in place today is wholly insufficient to meet the mass requirements in India, and would frustrate the efforts by state governments working to bolster the existing vaccination schemes. The question as to who will be qualified to even respond to tenders floated by state governments remains unanswered and the range of options appear quite bleak.

It has been repeatedly opined that the access to vaccines falls under Articles 14 and 21 of the Constitution, and has to be distributed in an expedited manner equitably to discharge such obligation. Entry 29 of the List III of the Seventh Schedule also obliges the Central government to assist the States "to control interstate spread of infectious diseases". The regulatory processes discussed above veer away from such assistance to be rendered to State governments, and negate any autonomy in dealing with domestic and foreign manufacturers.

State governments will also have to factor in the requirements for imported drugs under the Drugs and Cosmetics Act, 1940 and Rules, 1945, including packaging and distribution conditions, all of which will add several weeks if not months for obtaining “emergency” regulatory approvals in India. Such regulations seem to dilute the very purpose for which they have been effected and are hopefully brought to the attention of the various High Courts, which are monitoring the situation on a daily basis. The exercise of constitutional powers by these courts may be vital for state governments to cut through the red tape in dealing with these regulations and supplement the crippling vaccine shortages they are faced with today.

The author is a Partner at Mohan Associates, a Chennai-based law firm.