In This Economy: India's Drug Oversight Crisis — Why Every Cough Syrup Tragedy Is A Policy Failure

Happy Tuesday! India’s much-celebrated tag as the “pharmacy to the world” is under stress again. Fourteen children have died after consuming a locally made cough syrup contaminated with industrial-grade solvents, a tragedy that feels both shocking and painfully familiar.

The truth is, we’ve seen this movie before. In 2022, nearly 70 children in The Gambia died after taking Indian cough syrup laced with toxic diethylene glycol and ethylene glycol. The following year, 18 more children in Uzbekistan met the same fate. And those weren’t the first incidents either. From Chennai in the 1970s to Delhi in the 1990s to Jammu in 2020, every decade seems to bring a new reminder that India’s pharmaceutical regulation system is still struggling with the basics.

Each time, there’s outrage. Arrests are made, products banned, and inspections ordered. And then, silence. The pattern repeats with a flurry of action after tragedy, with little prevention before it.

On to this week's newsletter!

After the Gambia and Uzbekistan episodes, the government made it mandatory for export-bound cough syrups to be tested in government-approved labs before shipping. On the surface, that seemed like a firm, responsible move. But those same rules didn’t apply to medicines sold within India.

That policy blind spot says a lot about our regulatory mindset. We tighten oversight when our global reputation is at stake but remain far more lenient when it comes to protecting Indian consumers. It’s as if domestic patients are the testing ground, and international buyers get the assurances.

The irony is that most of these tragedies could have been prevented with basic due diligence. Testing for DEG or EG contamination is not rocket science; it’s routine lab work. But when manufacturers are allowed to self-certify, and state-level drug labs lack staff or equipment, detection becomes a matter of luck.

At the centre of this problem is the Central Drugs Standard Control Organisation, or CDSCO, India’s top pharmaceutical regulator. On paper, the CDSCO oversees everything from drug approvals to quality control. In practice, its authority is fragmented.

While the CDSCO handles central licensing, the actual inspection and enforcement duties fall to state drug controllers. Some states do this well, but many don’t. A 2023 parliamentary review found that nearly half of India’s state drug testing labs lacked proper equipment or qualified analysts. When enforcement varies this widely, the national safety net becomes dangerously uneven.

This gap played out again recently. The CDSCO’s own tests initially didn’t find contamination in the suspect cough syrup. It was a Tamil Nadu laboratory that later discovered the toxic chemicals. That tells you everything you need to know about the patchy oversight and about how quality failures can slip right through the cracks.

It’s easy to frame this as a lab or manufacturing problem, but that would miss the larger point. This is a governance failure. Oversight is split across agencies, inspection results are rarely published, and penalties for serious violations remain laughably low compared to the profits at stake.

The result is a system that punishes after harm is done but offers little deterrence before it. It’s not that India doesn’t have laws; it’s that the system enforcing them is far too lenient on offenders.

India’s pharmaceutical industry supplies 40% of America’s generic drugs, 25% of those used in the UK, and nearly 90% of the medicines sold across Africa. That dominance has been a point of pride and a pillar of global healthcare access. But every contamination scandal chips away at the trust that underpins it.

After the Gambia case, several African nations quietly started re-evaluating their import standards for Indian medicines. The World Health Organization also increased its scrutiny of Indian drug exports. For a country that built its pharma empire on credibility, these recurring lapses are costly.

The government has tried to respond. In 2024, the Health Ministry began what it called “risk-based inspections” of drug manufacturing units and announced a digital traceability platform to track medicines from factory to pharmacy. These are good steps but still short of the comprehensive reform India needs.

Most of these inspections are focused on high-risk categories, leaving vast parts of the market untouched. And the digital tracking system, while promising, is years from full implementation. What’s missing is not ideas but urgency and a unified regulatory structure that can enforce accountability across states.

If India truly wants to protect both its citizens and its pharmaceutical brand, it needs a fundamental reset. The country must treat drug safety as a national public health mission, not as a bureaucratic box to tick after each crisis. That means a single regulator with teeth, uniform testing standards for both domestic and export markets, real-time public disclosure of inspection data, and stronger penalties for violations.

The lesson here is painfully clear. Fourteen children shouldn’t have died because someone chose a cheaper solvent or skipped a test. Yet they did, and unless regulation becomes proactive, not reactive, it will happen again.

India’s pharmaceutical strength was built on scale and affordability. Its future, however, will depend on credibility and trust. The world doesn’t just buy India’s medicines; it buys faith in India’s systems. And that’s exactly what needs rebuilding now.

That’s all for this week. India’s pharma story is a source of pride but, without vigilance, is a dangerous prescription. See you next week with another deep dive into policy, reform, and accountability.