Drug License Requirement

Drug license requirements in government procurement refer to the mandatory possession of valid licences under the Drugs and Cosmetics Act, 1940, including State Drug Manufacturing Licences (Form 25/28), wholesale drug licences, and import licences, that pharmaceutical companies must hold to qualify as technical bidders in central and state drug tenders.

What is a Drug License Requirement in Government Tenders?

The Drugs and Cosmetics Act, 1940 requires all entities manufacturing, importing, or distributing drugs in India to hold appropriate licences. Government drug tenders translate this into technical qualification criteria that verify suppliers' regulatory standing before admitting their financial bids.

Licence requirements vary by the type of pharmaceutical supplier:

• Manufacturer: Valid Drug Manufacturing Licence from the State Licensing Authority (Form 25 for allopathic, Form 28 for patented/proprietary medicines), covering the specific dosage form and formulation being supplied
• Wholesale dealer/distributor: Valid Wholesale Drug Licence (Form 20/21) from the State Drug Controller
• Importer: CDSCO Import Licence under Form 10 for notified drugs and devices
• AYUSH medicines: Licence from the respective State AYUSH department

Government tenders specify not just licence possession but currency, expired licences are grounds for disqualification even if renewal is pending. Licences must cover the exact molecules and dosage forms being bid. A company with a manufacturing licence for tablets cannot bid for injectables without a separate injectable manufacturing licence.

Schedule M compliance (GMP standards under the Drugs and Cosmetics Act) is verified through the manufacturing licence and WHO-GMP certification, both of which are submitted with the technical bid.

Why Drug License Requirements matter for Indian government suppliers

Drug licence compliance is the baseline for all pharmaceutical government procurement. Companies maintaining complete, current licence portfolios across their product range can respond to any tender opportunity without regulatory gaps causing disqualification. Licence gaps discovered during tender evaluation cannot be rectified post-submission.

Example

A pharmaceutical company bids for a state tender for Amoxicillin 500 mg capsules. The NIT requires a valid manufacturing licence covering capsule formulations. The company holds a valid licence for tablets but its capsule manufacturing line was moved to a new facility whose licence is pending renewal. The bid is disqualified at technical evaluation. Maintaining current licences for all active manufacturing lines is a prerequisite for government drug procurement.

Frequently Asked Questions

How often must drug licences be renewed in India?

Drug Manufacturing Licences are generally valid for five years. Wholesale Drug Licences are valid for one year. Renewal must be applied for before expiry; operating with an expired licence is a statutory violation and results in automatic tender disqualification.

Can a distributor bid for state drug tenders or only manufacturers?

Both manufacturers and distributors can bid, depending on tender terms. Some state medical corporations accept only direct manufacturers or their authorised selling agents. Others accept distributors holding wholesale drug licences and OEM (manufacturer) authorisation letters. The NIT specifies which categories of bidders are eligible.

What is Form 25 vs Form 28 in drug manufacturing?

Form 25 is the licence granted for manufacturing allopathic drugs (standard drugs defined in the Drugs and Cosmetics Act). Form 28 is for manufacturing patented or proprietary medicines whose formulas are not in the standard pharmacopoeia. Most essential medicines government tenders relate to Form 25 licensed products.

Are Ayurvedic drug licences accepted in allopathic drug tenders?

No. AYUSH (Ayurvedic, Yoga, Unani, Siddha, Homeopathic) drug licences are distinct from allopathic drug licences. They are issued by State AYUSH departments and only qualify for tenders specifically for AYUSH products. Allopathic drug tenders require allopathic manufacturing or wholesale drug licences.