Small drug manufacturers may face closure if the finance ministry sticks to the existing investment limit of Rs 1 crore (Rs 10 million) for the small scale industries sector.

As all drug manufacturers will be required to meet high quality standards and follow good manufacturing practices under the revised Schedule M guidelines from next year, the bar on investment can ring the death knell for these companies.

Industry organisations have argued that implementation of the new norms stipulated by the health ministry requires funds and small scale units cannot meet the stringent quality norms if the investment cap of Rs 1 crore stays. Moreover, no one is willing to lend to SSIs.

They have been pushing for raising the investment limit to Rs 5 crore (Rs 50 million) for small scale manufacturing enterprises involved in bulk drug production. Alternatively, they say, an upgradation fund should be set up for these drug manufacturers, on the lines of the textile upgradation fund.

From January 1, all drug manufacturers will have to meet strict quality norms relating to their premises, material, water systems, waste disposal, warehousing and production areas and quality control mechanisms.

The guidelines even cover the health, clothing and sanitation of workers, besides strict guidelines for documentation.

 "The personnel handling beta-lactum antibiotics shall be tested for penicillin sensitivity before employment and those handling sex hormones, cytotoxic substances and other potent drugs shall be periodically examined for adverse effects. These personnel should be moved out of these sections (except in dedicated facilities), by rotation, as a health safeguard," reads a part of the revised Schedule M requirements on the health, clothing and sanitation of workers.

The norms also specify that prior to employment, all workers shall undergo medical examination, including eye check-ups.

Also, they shall have to be free from tuberculosis, skin and other communicable or contagious diseases.

Thereafter, they should be medically examined periodically and records maintained.

The licensee will be required to provide the services of a qualified physician for assessing the health status of personnel involved in different activities.

Industry bodies argue that small scale manufacturers will need more funds to implement these norms. And unless the investment limit for bulk drug and pharmaceutical manufacturers is raised to Rs 5 crore, none of these units will survive.

Currently, the investment cap for SSIs is Rs 5 crore only for 10 of the total of 600 bulk drugs manufactured in the country.