Pharma Company Regulatory Compliance Checklist: CDSCO, SPCB & Drug License

Why Foreign Pharma Companies Need a Compliance Roadmap in India

Operating a pharmaceutical business in India requires navigating approvals from at least five different regulatory bodies — CDSCO, State Drug Controller, SPCB, Factory Inspectorate, and MCA/RBI. Missing any single approval can result in plant shutdown, criminal prosecution of directors, and debarment from future licensing.

India's pharmaceutical sector is among the largest in the world by volume and a major global supplier of generics and APIs. The sector permits 100% Foreign Direct Investment (FDI) through the automatic route for greenfield projects, and up to 74% through the automatic route for brownfield projects (beyond 74% requires government approval). This checklist is organized by regulatory authority to help foreign companies track every required compliance.

Part 1: CDSCO (Central Drugs Standard Control Organisation)

CDSCO, under the Ministry of Health and Family Welfare, is the central regulatory authority for pharmaceuticals, medical devices, and cosmetics in India. Applications are submitted through CDSCO's online (SUGAM) portal at cdscoonline.gov.in.

Drug Manufacturing License (Form 25/28)

Every unit manufacturing drugs in India requires a manufacturing license issued by the State Drug Licensing Authority under the Drugs and Cosmetics Act, 1940.

Application is made in Form 24 to the State Licensing Authority, and in Form 27 for Schedule C and C(1) drugs. For Form 28 licences, a joint inspection by Central and State Drug Inspectors is mandatory before grant. Drugs specified in Schedule X are licensed separately and attract additional conditions, record-keeping and storage requirements — confirm the applicable form with the State Licensing Authority before applying. Licences no longer expire on a fixed date: they continue in force provided the licence retention fee is paid before the end of each five-year period.

Drug Import License

Foreign companies importing finished drugs or Active Pharmaceutical Ingredients (APIs) into India need:

• Registration Certificate (Form 41 under the Drugs and Cosmetics Rules, 1945, applied for in Form 40) for the foreign manufacturer, issued by CDSCO
• Import License (Form 10/10A) issued by the CDSCO Zonal Office
• GMP Certificate from the country of origin, authenticated and apostilled
• Certificate of Pharmaceutical Product (CoPP) issued by the regulatory authority of the exporting country

Foreign manufacturers must appoint an authorized Indian agent who holds a valid wholesale or manufacturing license. All import applications are processed through the SUGAM portal with typical processing times of 45-90 days.

Clinical Trial Approval

If conducting clinical trials in India, the company needs approval from CDSCO under the New Drugs and Clinical Trial Rules, 2019. This is a separate application from the manufacturing license and involves:

• Ethics Committee approval from each trial site
• CDSCO approval for the clinical trial protocol
• Registration on the Clinical Trials Registry of India (CTRI)
• Mandatory compensation provisions for trial-related injuries

Part 2: State Drug Controller Compliance

While CDSCO handles policy and certain categories of drugs, the day-to-day licensing and enforcement is managed by State Drug Controllers. Each state has its own Drug Control Department.

Wholesale Drug License (Form 20B/21B)

If the foreign company's Indian entity distributes drugs (even its own manufactured products), it needs a wholesale drug license from the state authority:

• Form 20B: Wholesale of drugs other than Schedule C/C1
• Form 21B: Wholesale of Schedule C/C1 drugs

Retail Drug License (Form 20/21)

Required only if the entity operates retail pharmacy outlets, which is uncommon for foreign manufacturing companies but relevant for vertically integrated operations.

State-Level Inspections

State Drug Inspectors conduct periodic inspections of manufacturing facilities to verify GMP compliance under the revised Schedule M, which has applied to all manufacturing units since 1 January 2025. The transitional extension to 31 December 2025 was available only to smaller manufacturers that had submitted an upgrade and corrective-action plan to the Central Licensing Authority, and that window has now closed — there is no remaining transitional relief to rely on.

Part 3: Schedule M GMP Compliance (Revised 2025)

The revised Schedule M, notified in December 2023 and effective January 1, 2025, represents the most significant GMP overhaul in Indian pharmaceutical regulation in decades. It moves from a documentation-based approach to a system-based GMP framework aligned with WHO-GMP and PIC/S guidelines.

Key Compliance Requirements

Foreign companies already operating under US FDA, EU GMP, or PIC/S standards will find many of these requirements familiar. However, the India-specific documentation and submission formats differ, and compliance must be demonstrated to Indian inspectors specifically.

ALCOA+ Data Integrity Standards

All manufacturing records must now meet ALCOA+ standards: Attributable, Legible, Contemporaneous, Original, Accurate, Complete, Consistent, Enduring, and Available. Electronic systems must maintain audit trails capturing every modification, the person responsible, and the date/time of the change.

Part 4: SPCB (State Pollution Control Board) Consent

The category depends on what you actually make. Under CPCB's classification of industrial sectors, "pharmaceuticals manufacturing" — bulk drug and API synthesis — is a Red Category activity with a pollution index of 98.6, while "pharmaceuticals (formulation)" and "pharmaceutical R&D facilities" are Orange Category at 72.5 and vaccine manufacturing is Orange Category at 78.0. Getting this wrong at the planning stage is expensive: Red Category units face siting restrictions, longer consent processing and shorter consent validity than Orange ones. Two separate consents are required from the State Pollution Control Board of the state where the plant is located.

Consent to Establish (CTE)

This must be obtained before starting construction of the manufacturing facility. The CTE application requires:

• Site plan and plant layout drawings
• Process flow diagrams for manufacturing operations
• Projected water consumption and wastewater generation data
• Proposed effluent treatment plant (ETP) details and capacity
• Air emission control equipment specifications
• Solid waste and hazardous waste management plan

CTE is typically valid for 3-5 years or until the project is completed, whichever is earlier.

Consent to Operate (CTO)

After construction is complete and before commencing operations, the CTO must be obtained. This involves a site inspection by SPCB officers to verify that the pollution control measures proposed in the CTE are actually installed and functional. The CTO is renewable, typically every 1-5 years depending on the state and the company's compliance track record.

Legal Framework

Both consents are mandated under the Water (Prevention and Control of Pollution) Act, 1974 and the Air (Prevention and Control of Pollution) Act, 1981. Operating without either consent is a criminal offence.

Hazardous Waste Authorization

Pharmaceutical plants generating hazardous waste (solvents, chemical residues, expired drugs) must obtain separate authorization under the Hazardous and Other Wastes (Management and Transboundary Movement) Rules, 2016. This is also obtained from the SPCB.

Part 5: Additional Regulatory Approvals

Beyond CDSCO, the State Drug Controller, and SPCB, foreign pharma companies must secure several other approvals.

Factory License

Required under the Factories Act, 1948, from the Chief Inspector of Factories in the state. This is a prerequisite before any manufacturing operations commence and covers worker safety, working hours, and occupational health requirements.

Fire NOC

A No Objection Certificate from the local fire department is required before the Factory License is granted. Pharmaceutical plants storing flammable solvents may also require PESO approval (see our chemical manufacturing PESO guide).

GST Registration

Mandatory GST registration for manufacturing and selling pharmaceutical products. Do not plan pricing off the old four-slab rate table: the 12% slab was withdrawn in the rate restructuring that followed the 56th GST Council meeting of 3-4 September 2025, and medicines were re-rated in the process, with a list of specified life-saving drugs exempt. Confirm the current rate against your HSN heading (3003 or 3004) before fixing prices or filing.

FSSAI License

Required if the company manufactures nutraceuticals, health supplements, or food-for-special-dietary-use products. The FSSAI license is separate from the drug manufacturing license and is governed by the Food Safety and Standards Act, 2006.

Narcotics License

If manufacturing drugs containing narcotic or psychotropic substances, a separate license is required from the Narcotics Commissioner under the Narcotic Drugs and Psychotropic Substances Act, 1985.

Trademark Registration

Brand names for pharmaceutical products should be registered with the Trademark Registry. Brand names for medicines are also screened by the drug regulators for confusing similarity with existing products as part of the product-approval and state licensing process, so clear the name with the regulator in parallel with the trade mark search rather than after it.

Part 6: FEMA and Corporate Compliance for Foreign-Owned Entities

Foreign-owned pharmaceutical companies must also comply with FEMA and Companies Act requirements specific to foreign investment.

FDI Reporting

• FC-GPR: File within 30 days of share allotment to foreign investors
• FLA Return: Annual filing by July 15 for every year the company has outstanding FDI
• Annual Return on Foreign Liabilities and Assets: Submitted to the RBI

Transfer Pricing

Intercompany transactions between the Indian entity and its foreign parent (API supply, technology licensing, management fees) must be at arm's length. Transfer pricing documentation and the annual accountant's report are mandatory for every international transaction with an associated enterprise, regardless of value; the INR 1 crore figure governs only the relief from maintaining the prescribed transfer-pricing documentation, not the accountant's report itself. For tax year 2026-27 onwards that report is Form No. 48 (formerly Form 3CEB) under rule 85 of the Income-tax Rules, 2026, furnished under section 172 of the Income-tax Act, 2025 at least one month before the return due date; for FY 2025-26 and earlier years it was Form 3CEB under Rule 10E of the Income-tax Rules, 1962. Which of the two a filing made after 1 April 2026 in respect of FY 2025-26 must use is not settled by the notified rules — the Income-tax Rules, 2026 contain no repeal-and-savings provision. Check the form actually enabled on the e-filing portal before filing, and take professional advice. Given that pharma companies routinely have significant intercompany transactions, this is a critical compliance area. See our transfer pricing services for more details.

Annual Compliance Calendar

The Complete Pharma Compliance Checklist

Use this master checklist to track all approvals. Each item should be assigned to a responsible person with a target completion date.

Pre-Construction Phase

• Incorporate Indian entity (private limited company via SPICe+)
• Obtain Digital Signature Certificate (DSC) for directors
• File FC-GPR for initial FDI investment
• Obtain SPCB Consent to Establish (CTE)
• Obtain Environmental Clearance (if capacity exceeds threshold)
• Obtain Fire NOC from local fire department
• Secure land/premises and obtain building plan approval

Construction and Pre-Operation Phase

• Complete facility construction per GMP/Schedule M standards
• Install and validate ETP, air emission controls per CTE conditions
• Commission equipment and complete IQ/OQ/PQ validation
• Prepare Validation Master Plan (VMP)
• Implement Pharmaceutical Quality System (PQS)
• Apply for Factory License under Factories Act, 1948
• Apply for SPCB Consent to Operate (CTO)
• Apply for Drug Manufacturing License (Form 25/28) to State Drug Controller
• Obtain GST registration
• Obtain IEC if importing raw materials or exporting finished products

Operational Phase

• Conduct Product Quality Reviews (PQR) annually
• Maintain Quality Risk Management (QRM) documentation
• Ensure ALCOA+ data integrity across all records
• File monthly GST returns (GSTR-1, GSTR-3B)
• File advance tax quarterly
• Conduct statutory audit before AGM
• File annual compliance with MCA (AOC-4, MGT-7)
• File FLA Return by July 15 each year
• Renew SPCB CTO before expiry
• Maintain pharmacovigilance reporting
• Comply with FEMA reporting requirements

Part 7: Pharmacovigilance and Post-Market Compliance

Foreign pharma companies must establish a pharmacovigilance system in India to monitor and report adverse drug reactions (ADRs) after products reach the market.

Mandatory Requirements

• Qualified Person for Pharmacovigilance (QPPV): A medically qualified person must be appointed as the India QPPV responsible for pharmacovigilance activities
• ADR Reporting: Serious adverse reactions are reported to CDSCO on an expedited basis, conventionally within 15 calendar days, with non-serious reactions captured in the periodic reports. These timelines sit in CDSCO's pharmacovigilance guidance for marketing authorisation holders rather than in the rules, so confirm the version in force.
• Periodic Safety Update Reports (PSURs): Must be submitted to CDSCO every six months for the first two years after approval, and thereafter at the intervals CDSCO specifies for the product
• Risk Management Plans: Required for new drugs and high-risk products, including risk minimization strategies

Post-Market Surveillance Studies

CDSCO may require post-marketing surveillance (PMS) studies as a condition of drug approval, particularly for new drugs approved in India. Foreign companies must budget for these studies, which typically involve monitoring a defined number of patients at multiple sites across India over a period of 2-4 years. Failure to complete PMS studies can result in the drug approval being suspended or withdrawn.

Drug Recall Procedures

If a quality issue is identified post-market, the company must initiate a recall following CDSCO's guidelines on recall and rapid alert systems for drugs. Voluntary recalls must be communicated to the State Licensing Authority and CDSCO, supported by a documented root cause analysis and corrective action. Those guidelines are guidance rather than a statutory rule, so settle the notification format and timelines with the State Licensing Authority before a recall is launched. Mandatory recalls triggered by CDSCO carry additional scrutiny and may result in license suspension pending investigation.

Key Takeaways

• Foreign pharma companies in India need approvals from at least five regulatory bodies: CDSCO, State Drug Controller, SPCB, Factory Inspectorate, and MCA/RBI
• The revised Schedule M (effective January 2025) mandates system-based GMP with ALCOA+ data integrity, PQS, and QRM, aligning India with WHO-GMP and PIC/S standards
• Greenfield FDI is 100% under automatic route; brownfield is 74% automatic and beyond requires government approval
• Drug manufacturing licences (Form 25/28) no longer carry a fixed expiry — they continue in force provided the licence retention fee is paid before the end of each five-year period
• Start SPCB consent, Fire NOC, and Factory License applications in parallel with facility design to avoid 6-12 month delays in the pre-operation phase