Buyer beware: On the QR code-based drug traceability framework
The Health Ministry’s notification to expand Schedule H2 drugs to entire therapeutic classes now from a curated list of brands earlier is a commendable change from regulating based on revenue to regulating based on risk. The government had introduced Schedule H2 in 2022-23, which required a barcode or QR code on each pack of specific drugs to verify the pack’s authenticity. It is part of a framework that also touches on regulating active pharmaceutical ingredients and export-oriented pharmaceutical compliance. Now, with the additional symbols encoding a product identifier, the manufacturing licence number, batch number, and other details, authorities hope to better track down defective batches. Counterfeit networks have long targeted vaccines, cancer medicines and antimicrobials, with WHO flagging high volumes of fake antimicrobials in low- and middle-income countries. India has one of the world’s highest antimicrobial resistance rates, and substandard antimicrobials can lead to sub-therapeutic dosing, exerting selection pressure on resistant strains. The Narcotics Control Bureau has also expressed concerns about medicinal opioids and psychotropic substances ‘leaking’ into illicit markets. The government will hope that the new system addresses the U.S. FDA’s and the European Medicines Agency’s recurring concerns about quality control, an issue on which India has found itself on the back foot over contaminated cough syrups. The U.S. Trade Representative has also repeatedly identified India as a leading source of counterfeit medicines, with many fake pharmaceuticals seized at the U.S. border originating from or transiting through India. Together with policy changes effected by the Jan Vishwas Act 2026 , the new framework finally distinguishes between procedural non-compliance and substantial non-compliance, considering only the latter constitutes meaningful enforcement. In the long term, the government should rationalise the compliance burden and eliminate the risk of corruption associated with discretionary enforcement. The government must also recognise that the QR code system will only be effective if backed by a state-managed database that pharmacists and regulators can access in real time, supported by interoperable software and scanning infrastructure across States. Second, pharmacists and consumers must develop a habit of verifying medicines before a sale. Third, the compliance needs imposed by new packaging requirements and the IT integration will strain MSME manufacturers in particular. Finally, prescription data on controlled substances is sensitive information and will need to be handled with a digital governance layer that does not yet exist. Thus, whether the new framework will improve India’s reputation as a pharmacy comes down to its implementation. Published - June 29, 2026 12:20 am IST Read Comments Copy link Email Facebook Twitter Telegram LinkedIn WhatsApp Reddit READ LATER SEE ALL Remove Related Topics health / Drugs / pharmaceutical / prescription drugs / exports / vaccines / cancer / USA / Europe / law / corruption & bribery / software / online / technology (general)
- 1The expansion of Schedule H2 to entire therapeutic classes represents a constitutional exercise of the Union's power to regulate public health under Entry 19 of the Concurrent List (drugs and poisons). The Jan Vishwas Act 2026, by distinguishing procedural from substantial non-compliance, brings Indian pharmaceutical enforcement closer to the proportionality principle foundational in administrative law — that regulatory action must match the gravity of the breach. Effective governance of this framework additionally requires a state-managed real-time drug database, interoperable scanning infrastructure, and a digital governance layer for sensitive prescription data, none of which fully exists yet.
- 2India's pharmaceutical sector faces compounding reputational challenges in international trade. The U.S. Trade Representative has repeatedly identified India as a leading source of counterfeit medicines, and both the U.S. FDA and European Medicines Agency have raised quality control concerns — matters that contributed to export restrictions following contaminated cough syrup scandals. The new QR code-based traceability framework is partly aimed at restoring India's credibility as a trustworthy 'pharmacy of the world,' addressing concerns that have periodically strained India's pharmaceutical export relationships with its largest trading partners.
- 3India's drug regulatory architecture is built on the Drugs and Cosmetics Act, 1940, which provides the statutory basis for drug scheduling. Schedule H restricts drugs to prescription-only sale, while Schedule H1 and H2 add progressive layers of traceability and record-keeping. The Narcotic Drugs and Psychotropic Substances Act, 1985 separately governs medicinal opioids. The new traceability framework attempts to bridge enforcement gaps between these statutes, creating supply chain accountability from manufacturer to retail pharmacy. The Jan Vishwas Act 2026 further reforms the enforcement architecture by reducing unnecessary criminalization of procedural lapses.
- 4India is the world's third-largest pharmaceutical producer by volume and a major supplier of generic medicines to low-income countries, yet it also has one of the highest antimicrobial resistance rates globally. Sub-standard antimicrobials — which cause sub-therapeutic dosing and thus selection pressure on resistant bacterial strains — represent both a public health and economic risk. The new compliance requirements for QR coding and IT integration will disproportionately burden MSME pharmaceutical manufacturers, who produce a significant share of India's generics output, making it essential to calibrate implementation timelines and support mechanisms for smaller producers.