Starting a Pharmaceutical company is a dream project for every pharma professional. But most of us haven’t start own pharmaceutical venture due to lack of knowledge and procedure to start pharmaceutical company. Here we will try to help you to start your own pharmaceutical company. This article we cover complete detail that is necessary to start pharmaceutical company.
We can divide pharmaceutical companies in two parts:
These are two basic types of pharmaceutical companies. These can be further divided into following parts based upon their marketing, sale and work basis irrespective of marketing and/or manufacturing type.
- Pharmaceutical Branded/Ethical Company
- Pharmaceutical Generic Company
- Pharmaceutical Franchise Company
- Pharmaceutical Pcd Company
- Pharmaceutical Specialty company e.g. Derma, ophthalmic, cardiac etc
- Pharmaceutical Export Company
- Pharmaceutical Import Company
- Pharmaceutical OTC company
- Pharmaceutical Distribution Company
- And many more
A manufacturing company can be marketing company at same time if they are doing own marketing also along with manufacturing. Manufacturing company also require to fulfill marketing company licenses and requirements to market, sell and distribute products.
There are different procedures to start marketing and manufacturing pharmaceutical company. In this article we will cover licences, procedure, documents, qualifications and requirements to fulfill criteria for marketing company and manufacturing company. First we will discuss about requirements, licenses required and Licencing authority for granting licenses for manufacturing company. Later in article will discuss about marketing/distribution/trading company.
How to start Pharmaceutical Manufacturing Company
- Plant and Building (As per WHO:GMP and/or Your Country Law like in India, As per Drug and Cosmetic Act)
- Technical Staff i.e. Approved Manufacturing Chemist and Approved Analytical Chemist
- Machinery and Lab Equipment
- Office Accessories
- Machine Men and Workers
- Electricity Supply
- Water Supply
- HVAC unit
- List of medicines to be manufactured
- Non Objection Certificate if required
- Company Registration (in case proprietorship you may skip this process)
- Manufacturing License
- Laboratory License
- Wholesale Drug License
- Goods and Service Tax Number
Licensing Authority for Manufacturing License:
Licensing Authority is a department and/or authorized person by government to grant, renew, issue and suspend license for any manufacturing unit. In case of manufacturing unit Drug Control Officer of concern state is a licensing authority for pharmaceutical manufacturing unit. Licensing Authority office is generally located at State Capital and/or Zonal basis for big states. You have to apply to licencing authority for granting of manufacturing license.
For new drugs, blood and blood products, IV fluids, vaccines and sera in India approval and licensing, Licensing authority is Drug Controller General of India.
How to apply?
Once you have completed all requirements and documents, you can visit to state drug control office for submitting your file for granting of manufacturing license. Most of state has started online application submission and/or some states still use manual file submission. You may have to visit number of times to licensing authority for it. Once you have submitted your application. Licensing Authority will intimate inspection schedule for your manufacturing unit through mail, phone and/or manually as applicable.
Inspection is conducted by joint team of State Drug Control Office and District Drug control office and/or with central drug authority. All facilities, technical staff detail, machineries and particulars are inspected according to submitted application and as per Drug and Cosmetic Act & Rules.
In case, all requirements and documents are find to be satisfactory, a license is issued by concerning drug authority for manufacturing of medicines in enclosed list with manufacturing license application.
Only Manufacturing License and Laboratory License processes are different for Pharmaceutical Manufacturing Company from Pharmaceutical Marketing Company. Remaining processes are same for both types of companies. Manufacturing Company also require wholesale drug license. Wholesale Drug License Procedure we have discussed in how to start pharmaceutical marketing company section below.
Remaining processes we will discuss later in article. Documents also we will discuss in end. You can skip to end to read documents required for each process. One of main critical step is trade mark registration. Trade Mark registration is important for protection of company name and brand names.
How to Start Pharmaceutical Marketing Company
- Premises (Cemented and well furnished floor and walls, concrete roof etc)
- Competent Person i.e. Pharmacist or Experience Person
- Office Accessories
- Freeze and Air conditioner if asked for
- Electricity Supply
- Company Registration (in case proprietorship you can skin this process)
- Wholesale Drug License
- Goods and Service Tax Number
- FSSAI Registration (In case of selling Food and Dietary Supplements also)
License Authority for Wholesale Drug License:
Licensing Authority is a department and/or authorized person by government to grant, renew, issue and suspend license for wholesale drug licence. In case of wholesale drug license Senior Drug Inspector and/or Drug Inspector of concern district is a licensing authority for pharmaceutical marketing company. Licensing Authority office is generally located at District Head quarter and/or combined for two or more districts in some regions. You have to apply to licencing authority for granting and issuing of wholesale drug license.
How to apply?
Once you have completed all requirements and documents, you have to visit District drug control office in your district for submitting your file for granting of wholesale drug license. Most of state has started online application submission and/or some states still use manual file submission. You may have to visit number of times to licensing authority for it. Once you have submitted your application online, you still need to submit your uploaded documents physically at licencing authority office . Licensing Authority will intimate inspection schedule for your premises inspection through mail, phone and/or manually as applicable.
Inspection is conducted by District Senior Drug Inspector and/or Drug Inspector. All facilities, competent person details and other particulars are inspected according to submitted application and as per Drug and Cosmetic Act & Rules.
In case, all requirements and documents are find to be satisfactory, a license is issued by concerning drug authority for sale, stock, exhibit and distribute of medicines for wholesale.
How to Register Company in India (Company Registration)?
There are four types of pharmaceutical companies mostly registered under Company Act.
- One Person Company
- Private Limited Company
- Limited Liability Company
- Public Limited Company
Each type of company has different requirements and eligibility. There are certain criteria fixed by Government of India for registration your company in any type. Ministry of corporate affair regulated company registration through Company Act 1956, 2013 and allied Acts. You can register your company through ministry of corporate affairs website.
Most of us will not take burden to apply for company registration by own self if we can get company registration consultants easily. Most of Chartered Accounts and Sale Tax/income Tax Advocates do this work with small consultancy fees. Search for CA and other agencies that deal in company registration nearby you and apply for company registration.
If you want to apply your own then you can visit at http://www.mca.gov.in/ and follow the process to apply for company registration.
How to apply for Goods and Service Tax Identification Number:
GST is essential in India for doing any type of business/trading but below 20 lac annual turnover, there is no requirement of GSTIN registration. GST registration is compulsory to obtain within 30 days after exceeding turnover above 20 lac. Unlike VAT, GST is valid in all states. It can be applied through portal provided by state government and/or center government.
Like company registration, you can outsource work of for GSTIN registration through CA and other agencies. If you want to apply for GSTIN by own then Go to www.gst.gov.in. There will be the two options: New User and Existing User. Click at New User, Enter your detail for apply GST, Enter you mobile number and Email Address of the authorized signatory of the business entity. This number and e-mail will be used for all future communication from the GST portal.
You will receive a OTP at mobile number and e-mail id you entered in previous step. Enter this OTP. After that follow all steps and enter information and scanned images of documents as mentioned in Provisional Registration form. After completion of this process, you have been successfully applied for GSTIN registration.
We will recommend you to let your CA do this work for you. They will charge some fees but it worth for work, they know better than you and us.
How to apply for Food Safety and Standards Authority of India (FSSAI) Registration
If you want to market food and dietary supplements along with medicines and drug then you also have to apply for FSSAI registration. This is a simple registration process which you need to apply online by visiting at FSSAI website. After applying application online, you also have to submit your documents manually at FSSAI officer’s office appointed by FSSAI department at district head quarter or at specific location. Office detail can be found at FSSAI website and/or contact number provided at their website.
This is applicable for marketing and selling of food & dietary supplements only. If you are a manufacturing food & dietary supplements then you have to apply for Food and Dietary Supplement manufacturing license at FSSAI website. This process is also online and has to submit documents at food officer’s office.
Documents and requirements are different for license and registration process. There are three type of categories under FSSAI.
- Central License
- State License
You can apply as per your need. If you are marketing, only registration could be ok but if you have large turnover you have to take state license from FSSAI. For manufacturing, you can opt for state license and/or central license as per your requirement.
Note: For granting FSSAI manufacturing license separate building and premises is necessary.
What will be Procedure and sequence to proceed for Starting Pharmaceutical Company
- Write a Business Plan
- Choose Company Name
- Choose molecules and Brand Names
- Designing of Company Logo and Printing/Promotional Material
- Choose place, premises and building for starting Pharma company
- Fund generation (own, loan, investment etc)
- Company Registration (If required)
- Trade Mark Registration(Optional)
- Manufacturing License (For Manufacturing Company)
- Wholesale Drug License (For both Marketing and Manufacturing Company)
- Goods and Service Tax Identification Number (GSTIN)
- FSSAI Registration and/or License (If required)
- Search for Vendors (For marketing Companies, Third Party/Contract Manufacturers or Loan license manufacturers. For Manufacturing Companies, Packing material suppliers, raw material & bulk drug suppliers and other requirements fulfillers)
- Finalize Packaging and Packing, Design Material for medicines boxes, label, foils etc
- Start manufacturing in case of manufacturing company
- Place order to manufacturer at basis of third party manufacturing/ contract manufacturing/ Loan Licencing in case of marketing company
- When products will be ready, start marketing and promotion of products. Read type of marketing in pharmaceutical sector here
Important Step in starting Pharmaceutical Company
- Taking Experience in pharmaceutical sector by doing job and/or indulge with any already established company/firm.
- Take training if you don’t have experience in pharmaceutical sector
- Choose Location of Business. Search for shop/building/premises for office, licenses and stock. It may be rented or owned but there should be adequate space as per government norm.
- Research and Prepare list of all molecule and combinations, you want to manufacture and/or marketing.
- Finalize Company Name and Brand Names of all products. Be sure these don’t resemble to any other company or brand already working in Market. Due to presence of thousand of brands and companies, it becomes difficult to choose unique name but you should try your best. Already registered or in process Trade Name and Company Name you can search at http://ipindiaonline.gov.in/tmrpublicsearch/frmmain.aspx. Trade name in class 5 and Company name at class 35.
- Appointment of Technical and competent staff
Now we will discuss about documents required for licenses we have discussed above.
Documents Required for Pharmaceutical Manufacturing License:
List of Documents required to obtain pharmaceutical manufacturing drug license: (May vary state to state):
- Covering Letter including introduction of applicant with address of the Plant and Administration office
- Prescribed forms duly filled and signed by the Proprietor / Managing Partner / Managing Director
- Fees challan in original remitting the required amount of fee in the Head of Account or Original Treasury Challan
- Documents related to ownership of firm (Proprietorship/Partnership/Company)
- Affidavit of Proprietor / Partners / Directors etc (Notarized)
- Address Proof copy duly attested
- Attested copy of ownership proof/rent agreement/lease deed
- Affidavit of applicants, manufacturing chemist and quality control chemist
- List of all technical staff along with photocopy of educational qualification and experience.
- Blue print of Plan and layout of the premises showing the installation of Machinery and Equipment.
- Design and layout of HVAC systems if applicable
- List of medicines intend to be manufactured in manufacturing unit
- Water Analysis Report
- Electricity Connection Documents
- NOC from competent Local Authority like Gram Panchayat , Nagar Nigam or Nagar Palika if applicable
- Detailed list of Manufacturing Machinery and Lab Equipment with copies of purchase Bills. (As per Format)
- Permission obtained from the Municipal Authorities/ Panchayat authorities / Certificate in conformity with Factories Act for construction and starting the Unit
- Permission from the Health Authorities / Pollution Control Board clearance of the area for setting up the manufacturing facility
- Clearance from Drugs Controller General (India), New Delhi in case of new drugs (Either Bulk drug or Formulation)
- Site Master File. (Refer para 29 of part I of Schedule M)
Affidavit formats, blue print format and other formats you can ask from drug control office
Documents Required for Wholesale Drug License:
Senior drug inspector and/or Drug Inspector can provide you full details of requirement for a whole sale drug license. Procedure and details for applying for D.L. number can be change according to government policies. Important documents are:
- Application will be submitted in form no. 19 with other detailed information forms.
- You or your partner (if any) either should be a registered pharmacist or Experienced Person or competent person. If you don’t have any of above qualification than you can appoint or hire a registered pharmacist or EP (Experienced Person) and make him authorized to handle all work on your behalf (Appointment letter will be submitted with application)
- Premises size should have minimum of 10 square meter area (requirement of area may vary) and should have single premises.
- Fees ( mode of fee and prescribed fee may vary)
- Blue print or layout of Premises
- Freeze purchase bill copy with complete address
- Air Conditioner if applicable
- Ownership or Rent agreement deed of premises.
- Electricity bill of premises.
- Affidavit of proprietor, partner, pharmacist, EP etc.
- Firm registration receipt in case private limited firm. List of directors, address proof, article of association etc is also to submit with application form
- Partnership deed if any
- Any other documents as asked by local drug controller etc.
Documents for Company Registration:
- DSC (Digital Signature Certificate)
- DIN (Director Identification Number)
- PAN (Permanent Account Number) Card
- TAN (Tax Deduction and Collection Number)
- Identity Proof (Electronic ID / Aadhar Card / Passport / Driving License)
- Passport Photo
- Address Proof (Bank Statement / Mobile Bill / Telephone)
- Rent Agreement (Notarised: For rented property) or Ownership proof
- Latest Electricity Bill
- MOA(Memorandum Of Association) or/andAOA (Article Of Association)
- NOC if required
Documents required for applying for GSTIN:
- Digital Signature Certificate (Class II)
- Address Proof of Business Entity
- Proprietor/Partners/Directors Address Proof
- Aadhaar Card, PAN and Image etc
- Ownership Proof or Rent agreement
- Partnership deed or memorandum of association/certificate of incorporation
- Back Statement and Bank Detail
Qualification for Competent/Technical Staff:
Qualification of Technical Staff for Manufacturing Company
Minimum of Bachelor in Pharmacy with one and half year of experience in pharmaceutical manufacturing unit under supervision of approved manufacturing chemist
Minimum of Bachelor in Sciences with three year of experience in pharmaceutical manufacturing unit under supervision of approved manufacturing chemist
Minimum of Bachelor of Pharmacy
Minimum of Bachelor in Science with three year of experience in Laboratory of pharmaceutical manufacturing unit under supervision of approved analytical chemist.
Qualification and Eligibility for EP or competent person for Marketing Company
Person should have one of the below qualification or eligibility to be EP or competent person:
- Registered pharmacist under state pharmacy council or
- Minimum of one experience at registered wholesale drug licensed firm after graduation with salary in bank account and appointment letter, resignation letter & experience letter at firm’s letter head with duly stamped and signed
If you want to know about Investment then Read our Article: How much Investment requirement required to Start these Companies?
Hope this information is useful to you…
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