Guidelines for Retention of Drug License

retention of drug license
Dashmeet Kaur
| Updated: Jan 27, 2020 | Category: Drug

One can find several pharmacies in every nook and corner of Indian streets. Since we often count on the local drug stores for trivial health issues, it becomes indispensable to rely on certified medical stores only. The Drug and Cosmetic Act, 1940 has set some stringent guidelines for the retention of drug license. Anyone who urges to commence a Pharma business must obtain the drug license and adhere to the revised provisions.  This blog enlists all the latest amendments in the Drug and Cosmetics Rules that all pharmacists and drug dealers must comply.

Fundamental Purpose of Drug License Registration in India

The drug license represents a permit from the Government to conduct any pharmaceutical activities. The Drug and Cosmetic Act regulates the manufacture, sale, distribution, import of drugs since the year 1940. Drug license is based on certain terms of conditions that every druggist ought to follow for the retention of drug license. The primary objective to set such conditions and provisions was to safeguard the interest of the public.

Browse through our articles on services provided at Swarit Advisors, and just let us know if we can help you with your company registration or tax filing or trademark registration.

Provisions for obtaining obtain a Drug License

Before directly applying for the drug license, you must check whether you resonate with these guidelines of Drug and Cosmetic Act, 1940:

  • An applicant of drug license should have at least four years of practical experience in drug distribution.
  • A drug licensee can only manufacture a medicine or drug under the supervision of an experienced pharmacist.
  • It is prohibited for the licenses to stock or sell any drug after its expiry.
  • A drug retailer cannot sell any drug to a minor or a kid below 18 years.
  • Also, the drug retailers should make an entry into the register each time they supply a drug.
  • Likewise, all pharmacists must keep a record of the drugs they sell through retail or medicines intended for sale.
  • The medicaments to cure animals must be labelled as “Not for human use, for treatment of animals only.”
  • Drugs which falls under the category of Schedule H or Schedule X or have a validity of 2 years. Thus, such drugs should only be supplied to the registered medical centres such as nursing homes, dispensaries, hospitals and medical practitioners. Moreover, it is essential to sign a written order to provide these drugs.
  • As per the Drug and Cosmetic Act, a drug licensee cannot store any drugs at his premises that were intended for the free sample distribution to a certified physician.
  • If a medical practitioner prescribes any medicine, then it should be under the supervision of a registered pharmacist before its supply or retailing.
  • In case, a pharmacist has preserved an expired medicine in order to claim a rebate from the Income Tax Department; then it shall not be regarded as an offence unless the drug is not indented for sale purpose.

Encoding Drug and Cosmetic (10th Amendment) Rules, 2017

On 27th October 2017, the authority of Drugs and Cosmetics issues (10th Amendment) Rules. Here are some of the highlights of the amendments:

  • According to the new amendments, the sale and manufacturing license shall have eternal validity, if the licensee pays for retention of drug license every five years.
  • However, the license shall not remain valid forever if the licensing authority suspends or cancels it.
  • Further, it says that for manufacturing licenses, the Central and State Drug inspectors shall inspect the premises at least once in three years or as per the need of the risk-based approach.
  • The Government has also streamlined the renewal of manufacturing and sale licenses by easing the provisions. Thereby it helps the licensees to sustain their business for the long run.
  • The implementation of such amendments was difficult. Therefore, the Central Government has announced new Drugs and Cosmetics (11th Amendment) Rules, on 17th July 2019.

New Amendments for the Retention of Drug License

To have an efficient implementation of permanent drugs licenses of manufacturing and sale, the Government has made some omissions and additions to the Drugs and Cosmetics Rules, 1945.

Additions in the Drugs and Cosmetics Rules:

  • Inspection of Retail and Wholesale Premises- An inspector appointed under the Drug and License Act, shall inspect each premise of wholesale and retail to validate that they compel with the conditions and provisions of the Act. The inspection is done in not less than once in three years.
  • Amendment for Renewal of Drug License- In regards to the latest amendments in Drug and Cosmetic Act, 1945, the licensee will not need to renew his drug license in future. The condition being if the licensee has Distribution/ Wholesale, Pharmacy/ Retail, Manufacturing or Loan License Form* for cosmetic or pharmaceutical preparations, then there is no requirement for license renewal.
  • Deposit Fee for Retention of Drug License- One also has to pay license retention fee before the date of expiry of drug license in every five years, unless it gets cancelled or suspended by the licensing authority.

Impact of New Guidelines for Retention of Drug License

Here is the end-result of the new amendments for drug license retention:

  • Since the drug license renewal was a time-consuming procedure, so the implication of new amendments will save much time.
  • Moreover, it will form transparency in the process of drug license.
  • These amendments will also be beneficial for the Drug Department as they will have less burden of work. Besides, Drug Department can now focus on the proper implementation of provisions and rules prescribed by the Drug and Cosmetic Act.
  • Further, it will uplift the quality of the drugs manufactured in India due to the regular checking undertaken by the standard compliance.
  • With the stringent inspection of Drug Department, the licensee shall become obligated to fulfill all the requirements.
  • The manufacturers and retailers will only follow on good manufacturing standards because a strict inspection will be executed by the State Drug Authority and Joint team of Center.


The latest guidelines of Drug and Cosmetic Act, 1945 for retention of drug license will bring a positive change. It will create a win-win situation for both the Drug Department and drug license holder. If you need any additional guidance related to the issue and renewal of drug license, contact Swarit Advisors.

Related Articles

Distribution of Drugs
Shivani Jain
| Date: Jul 17, 2020 | Category: Drug

Restrictions on Manufacture, Sale and Distribution of Drugs

In today’s era, drugs have become an inevitable part of everyone’s lives. We need them to preserve or restore our health. Hence, they are also known as life saving remedies....

Read More
Drug License online in India
Khushboo Priya
| Date: Apr 29, 2019 | Category: Drug

Procedure for obtaining Drug License online in India

I f you wish to sell medicines or open a pharmacy in India, firstly, you need to obtain a drug license. The reason why drug license is mandatory is to...

Read More
Drug License Rules
Dashmeet Kaur
| Date: Dec 13, 2019 | Category: Drug, Government

What are the Drug License Rules in India and its Eligibility Criteria?

Gone are the days when people get sick in the old age only. Nowadays, everyone is dealing with some health issues. Considering the decaying conditions, each street of India has...

Read More


Hi! My name is Akanksha! Let's talk.