17 Drug Samples Flagged as “Not of Standard Quality” in First Month of 2026; Systemic Capacity Gaps and Regulatory Fragmentation Remain Unresolved, Raja Aditya of Neo Science Hub, reports
In its latest monthly surveillance report, Telangana’s Drugs Control Administration (DCA) flagged 17 drug samples as “Not of Standard Quality” (NSQ) during January 2026, with 12 identified by Central Drugs Standard Control Organisation (CDSCO) laboratories and 5 detected by the state’s Drugs Control Laboratory and Testing (DCLT). The discovery comes as India’s fragmented pharmaceutical regulatory system grapples with persistent quality failures at the manufacturing level, a crisis that underscores both the effectiveness of strengthened surveillance mechanisms and the inadequacy of enforcement infrastructure to prevent substandard medicines from reaching patients.
The Telangana findings align with a troubling national trend. In December 2025 alone, CDSCO laboratories identified 74 NSQ samples while state laboratories flagged 93 additional samples—a combined total of 167 batches—representing one of the highest monthly counts in recent years. Moreover, seven spurious drug samples (counterfeit medicines manufactured by unauthorized entities) were identified and are currently under investigation. The samples detected in December included widely prescribed formulations such as Zerodol-SP (Ipca Laboratories), Defcort (Macleods Pharmaceuticals), and Telmisartan tablets, pointing to quality breaches not in fringe manufacturers but in India’s branded pharmaceutical ecosystem.
Quality Parameters
When a drug is classified as “Not of Standard Quality,” it means the product has failed to meet one or more prescribed quality specifications as defined under the Drugs and Cosmetics Act, 1940. These failures span a diverse array of technical parameters. In December 2025, reported NSQ failures included assay discrepancies (where the active pharmaceutical ingredient measured outside permissible concentration ranges), dissolution failures (indicating improper rate of drug release from solid oral dosage forms), sterility test failures in injectable formulations, and particulate matter contamination. Regulatory authorities emphasized that such batch-specific failures do not automatically invalidate other products from the same manufacturer, a distinction critical for consumers but frequently misunderstood by the general public and media.
For Telangana specifically, the common parameters triggering NSQ classifications have historically included assay failures, dissolution inconsistencies, pH deviations, microbial limit violations, and particulate contamination. While individual parameters may appear technical, their consequences are clinically significant. Assay failures result in subtherapeutic dosing, potentially rendering medicines ineffective; dissolution failures in solid oral formulations compromise drug bioavailability; and sterility test failures in injectables create direct risk of microbial contamination and sepsis. Collectively, these failures compromise therapeutic efficacy, accelerate antimicrobial resistance (particularly in antibiotic classes), and pose acute dangers to vulnerable populations—children, the elderly, and patients with chronic illnesses.
One Laboratory, One State
Behind the January NSQ data lies a critical infrastructure constraint that regulators have struggled to address for years. Telangana, India’s largest pharmaceutical hub and home to over 200 biotech and pharmaceutical firms, operates a single state drug testing laboratory—the Drugs Control Laboratory (DCL) in Hyderabad. This laboratory, while NABL-accredited under ISO/IEC 17025:2017 standards and equipped with sophisticated analytical instruments including High-Performance Liquid Chromatography (HPLC), Gas Chromatography (GC), and Atomic Absorption Spectroscopy (AAS), faces an operational capacity ceiling of 5,000 to 6,000 samples annually.
The limitation is stark when contextualized against the scale of Telangana’s pharmaceutical operations. Between January 2024 and July 2025, the Telangana DCA conducted over 42,000 inspections and tested approximately 7,200 drug samples—a sampling rate constrained by the single laboratory’s throughput capacity. During the same period, 186 NSQ samples were identified, leading to approximately 700 legal cases. In 2025 alone, the DCA recorded 244 drug seizures, 217 convictions, and recovered Rs 1.39 crore in seized pharmaceutical products.
Recognizing these deficiencies, Telangana’s government announced in late 2025 plans to expand the DCL infrastructure through renovation and augmentation of its facilities, with the objective of increasing analytical capacity and supporting intensified surveillance operations. However, the expansion remains in planning stages, and operational capacity improvements are unlikely to materialize before mid-2026 at the earliest—a lag that constrains the DCA’s ability to accelerate sample testing and early detection of quality failures in the supply chain.
The Regulatory Framework
Under Section 18(a)(i) of the Drugs and Cosmetics Act, 1940, manufacturing for sale or selling an NSQ drug is prohibited and constitutes a criminal offence. Penalties are prescribed under Section 27(d) of the Act. When an NSQ sample is identified, regulatory authorities typically initiate immediate recall of the affected batch, followed by investigation and action against the manufacturing firm. Permissible enforcement actions include stop production orders, stop testing orders, license suspensions or cancellations, warning letters, show cause notices, and criminal prosecution.
However, the regulatory landscape shifted in 2023 with the Jan Vishwas (Amendment of Provisions) Act, which made certain NSQ violations compoundable offences—meaning manufacturers could settle minor violations through payment of fines rather than face criminal prosecution. The Drugs & Cosmetics (Compounding of Offences) Rules, 2025, specify that only relatively minor violations (such as labelling errors, minor documentation lapses, or certain NSQ cases that do not cause harm) are eligible for compounding. Serious safety violations—toxic, adulterated, or spurious drugs; manufacturing without license; unsanitary conditions—remain subject to criminal penalties.
Telangana’s Health Minister, Damodar Rajanarsimha, has signaled a tougher enforcement posture, instructing the DCA to invoke the Preventive Detention Act in cases involving counterfeit and banned medicines, ensure swift prosecution of offenders, and mandate permanent closure for repeat violators. Despite these directives, legal challenges remain formidable. As one senior DCA official observed, “The legal battles are long and it takes time to prove. Till then, we find that there are other spurious manufacturers in the state.”
National Regulatory Fragmentation
The NSQ crisis cannot be separated from a fundamental structural problem: India’s pharmaceutical regulatory system comprises 37 separate regulatory bodies—the central CDSCO and 36 state/union territory regulators—each operating with competing interests and inconsistent enforcement protocols. This fragmentation has created persistent coordination failures that undermine the surveillance system’s effectiveness.
In a comprehensive analysis published in December 2025, The India Forum documented how “lack of transparency in drug inspections and quality testing perpetuates a culture of regulatory capture, allowing poorly manufactured medications to endanger public health.” A case in point: A pharmaceutical firm later implicated in child deaths in The Gambia in 2022 (from adulterated cough syrup manufactured in India) had multiple run-ins with drug controllers across different Indian states, yet it retained its manufacturing license until after the international tragedy materialized. The fragmented regulatory structure, combined with logistical challenges in information coordination between 37 separate authorities, enabled this regulatory failure.
The July 2025 NSQ alert further illustrates the coordination problem. In their June 2025 surveillance report, CDSCO received NSQ data from only 11 states and union territories (Himachal Pradesh, Jharkhand, Karnataka, Maharashtra, Punjab, Tamil Nadu, Telangana, Tripura, West Bengal, Puducherry, Jammu & Kashmir). Notably absent: data from Andhra Pradesh, Gujarat, Delhi, Uttar Pradesh, Rajasthan, Odisha, Bihar, and Kerala—eight major pharmaceutical hubs. The absence reflects not necessarily absence of NSQ drugs but rather inconsistent data submission protocols, laboratory capacity constraints, and varying levels of regulatory emphasis between states.
Telangana’s Real-Time Alert System
Recognizing the lag inherent in traditional regulatory communication, Telangana announced a significant digital initiative in December 2025: a real-time drug safety alert system enabling instantaneous communication of freeze and withdrawal orders to retailers and distributors across the state. The system represents a shift from the traditional monthly CDSCO alert cycle (wherein NSQ and spurious drugs are published on the CDSCO portal on a monthly basis) to an active, responsive communication infrastructure.
“If a drug batch is found to be not of standard quality, freeze and withdrawal orders can now be communicated instantly,” said DCA Director General Shahnawaz Qasim. “Delays in communication pose serious risks. Medicines identified as unsafe may continue to be sold simply because retailers and distributors have not received information.” Dr. G Srinivas, a senior pharmacologist, welcomed the initiative as “a significant step towards patient safety,” noting that “NSQ drugs carry a high risk of adverse reactions, sometimes fatal. Digital monitoring offers a proactive way to prevent such incidents.”
However, the system’s effectiveness hinges on stakeholder compliance and enforcement. Once a freeze order is issued through the digital platform, any seller continuing to stock and sell the flagged medicine faces strict legal action under the Drugs and Cosmetics Act. Implementation will require training of retail pharmacists, integration with supply chain tracking systems, and coordinated action by state police and enforcement agencies—a complex logistical undertaking in a fragmented regulatory environment.
Beyond Batch-Specific Failures
The significance of NSQ surveillance transcends laboratory statistics. Poor-quality medicines carry profound consequences for India’s public health and global pharmaceutical reputation. Historically, NSQ and counterfeit drugs have been implicated in serious tragedies. In 2007, four deaths in Maharashtra were attributed to spurious drugs. More devastatingly, in 2012, approximately 300 infants died in Kashmir following treatment with substandard ceftriaxone—a failure traceable to manufacturing lapses in a licensed facility.
Beyond acute tragedies, chronic NSQ circulation accelerates antimicrobial resistance (AMR), a silent epidemic. When patients consume subtherapeutic doses of antibiotics—as occurs when NSQ samples fail assay requirements—the selective pressure drives the evolution of antibiotic-resistant bacteria. India, already facing alarming AMR prevalence, cannot afford continued NSQ circulation in antibiotic formulations. Moreover, NSQ drugs in chronic disease management (cardiovascular, endocrine, psychiatric medications) result in therapeutic failure, adverse outcomes, and loss of patient confidence in the health system—consequences that ripple through public health systems and out-of-pocket healthcare spending.
For India’s global pharmaceutical standing, the NSQ issue poses reputational risks of existential proportion. India manufactures 12-25% of all medicines supplied globally and possesses the highest number of US FDA-approved pharmaceutical manufacturing facilities outside the United States. Should NSQ prevalence persist and international scrutiny intensify, India risks erosion of its market share in generic pharmaceuticals—an industry accounting for hundreds of billions of dollars in annual global trade and a cornerstone of India’s “pharmacy of the world” positioning.
Industry & Regulatory Perspectives
The pharmaceutical industry has raised concerns about the definitional clarity of NSQ classifications and the proportionality of penalties. The Drugs Act (Amendment) 2008 defines three specific categories: spurious, misbranded, and adulterated drugs. However, NSQ remains a broader, less precisely defined category that can encompass manufacturing quality lapses arising from poor storage conditions, inadequate supply chain controls, analytical errors, and intentional adulteration.
Industry associations argue for harmonization of NSQ definitions with FDA and international pharmacopoeial standards, distinguishing between genuine manufacturing errors (resulting in batch-specific failures) and systematic quality lapses (indicating systemic manufacturing deficiency). They contend that manufacturers operating subtherapeutic batches due to analytical error or poor distributor storage conditions should face proportionally different penalties than those engaged in deliberate adulteration or counterfeit drug manufacturing.
The Drugs Consultative Committee (DCC), in its 65th meeting (December 20, 2024), acknowledged these complexities and proposed that updated NSQ guidelines should incorporate advanced testing parameters and impurity profiling—rigorous analytical techniques designed to distinguish between batch-specific analytical failures and systematic manufacturing deficiency. The DCC also emphasized the need for expert collaboration between state licensing authorities, manufacturers, and testing laboratories to develop robust systems against drug counterfeiting and quality lapses.
Addressing Systemic Vulnerabilities
The January 2026 Telangana NSQ alert, when contextualized within India’s broader pharmaceutical regulatory ecosystem, reflects simultaneous progress and persistent vulnerability. On the positive side, the escalation in NSQ detection—from 34 samples in October 2024 to as high as 205 in November 2025—reflects heightened surveillance activity and increased participation of state laboratories in quality testing, indicative of strengthened regulatory attention. The launch of Telangana’s real-time digital alert system represents a technological innovation in regulatory responsiveness.
Yet systemic vulnerabilities remain unresolved. Regulatory fragmentation across 37 separate authorities continues to undermine coordination and accountability. Laboratory capacity constraints limit the breadth of surveillance that can be conducted across India’s vast pharmaceutical sector. Definitional ambiguities in NSQ classifications create inconsistent enforcement and generate industry pushback. Most critically, the penalties framework—particularly the compounding of offences provision—risks creating moral hazard whereby manufacturers calculate compliance costs against settlement fines and adjust operational practices accordingly. Addressing these vulnerabilities will require multifaceted reform: harmonization of regulatory standards across states; substantial investment in laboratory infrastructure and staffing; refinement of NSQ definitions aligned with international standards; centralized data management systems enabling cross-state regulatory intelligence; and stricter enforcement against repeat violators and systematic quality lapses. Until such systemic reforms materialize, India’s NSQ surveillance—while increasingly visible—will remain a reactive rather than preventive mechanism, identifying and removing substandard medicines from the supply chain only after they have entered commerce.
