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The small and medium-sized pharma enterprises (MSMEs) in Madhya Pradesh is exploring an innovative, collaborative ‘pooling’ strategy to navigate regulatory hurdles like the implementation of revised Schedule M.
Faced with a severe lack of space and land to meet the new Schedule M regulations, many of the state's approximately 200 MSME drug manufacturers are considering pooling their resources to build new, jointly owned facilities. This strategy is seen as a potential lifeline for units that might otherwise be forced to shut down, says Dr Darshan Kataria, president, Madhya Pradesh state Drugs Manufacturers Association (MPDMA).
According to him, the revised Schedule M, which upgrades Good Manufacturing Practices (GMP), demands stricter standards for premises, plants, and equipment. However, for most MSMEs, their existing facilities are too small to accommodate the required upgrades, such as creating separate production and storage zones. With land acquisition being both costly and time-consuming, halting operations seems like the only option for many.
“The problem is not just a lack of physical space, but a human resources issue. The new regulations require a highly trained workforce to handle complex regulatory affairs. Small units find it hard to attract and retain such skilled personnel, who often leave for larger companies after gaining experience. This high turnover risk makes it difficult for small business owners to maintain long-term compliance”, Dr. Kataria told Pharmabiz.
In response, the industry has proposed a solution that leverages shared resources. By having two to five units "pool together," they can jointly build a new, compliant facility. This collaborative model would help them overcome land and investment constraints, allowing these small enterprises to survive and continue their operations by sharing the financial and regulatory burden.
The association president further commented, “Despite the hurdles, there is a sense of optimism. While the units are at different stages of implementation, some are nearing completion. The industry believes the government will be flexible with deadlines, especially since the Union government has already granted an extension until December 31, 2025, for small manufacturers with a turnover under Rs. 250 crore, provided they submit an upgrade plan”.
When asked whether they have any plan to approach the government asking for some more time, Dr. Kataria said, although the industry has not yet formally requested an extension, it remains a possibility. Manufacturers are currently focused on implementation but plan to review their progress in the coming months. If needed, they will approach the government to request more time, demonstrating a proactive and realistic approach.
For many of the state’s small drug manufacturers, complying with the revised Schedule M is not just a regulatory mandate, it is an existential crisis. While the ultimate goal is to elevate India’s reputation as a global pharma hub, the immediate future of these units depends on overcoming these significant logistical and human resource challenges. The success of this "pooling" strategy could serve as a blueprint for other states facing similar issues.
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