Research and Articles

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• The Department of Pharmaceuticals has standardized the valuation method of free samples distributed to healthcare practitioners.

• Companies to now submit marketing expenditure disclosures to their respective industry associations.

• Industry associations required to implement robust data retention policies.

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I. Introduction

The Department of Pharmaceuticals (“DoP”), through a circular dated September 1, 2025 (“UCPMP Circular”)¹, has introduced revised and simplified disclosure requirements in addition to providing clarification on the manner of submission of disclosures by companies and has introduced compliances for the industry associations under the Uniform Code for Pharmaceutical Marketing Practices 2024 (“UCPMP”).

These revisions come in response to representations made by industry stakeholders, which raised concerns over the administrative and operational challenges faced by pharmaceutical companies in complying with certain aspects of the UCPMP – particularly the requirements relating to the reporting of marketing expenditure and the valuation of free samples provided to healthcare professionals (“HCPs”).

The UCPMP Circular aims to ease the compliance burden while maintaining transparency and accountability in pharmaceutical marketing practices.

II. Key Takeaways

We have provided our brief analysis of some of the key takeaways in this update.

Free Samples

The UCPMP Circular provides specific guidance on the valuation of free samples distributed to HCPs, with the objective of standardising the calculation method. The key clarifications provided by the DoP include:

• Where the company manufactures the samples, the value must be determined on a per-unit basis (e.g., per tablet, capsule, vial, gram, or millilitre) using the price charged to the stockist or immediate customer for the same dosage form and strength.

• Where the samples are procured from another supplier, the purchase price of such samples must be used for valuation purposes.

In both cases, the value of free samples should be recorded as the average price charged to the stockist or immediate customer, or the average purchase price, for the same dosage form and strength of the drug, calculated on an annual basis.

By aligning the valuation method to either the selling price (in case of in-house manufacturing) or the purchase price (in case of procurement), and by introducing an annual average basis for recording the prices, the UCPMP Circular removes ambiguity and potential variation in interpretation and consolidating expenditure for disclosure purposes across the industry.

Marketing Expenditure Disclosures

Under the erstwhile draft of the UCPMP, companies were required to submit detailed disclosures of their monthly marketing expenditure directly to the DoP. However, the DoP through the amended UCPMP now requires companies to submit these disclosures to the respective industry associations of which the company is a member. Further, the format for such disclosures has been revised to simplify reporting.

The DoP has further clarified that where the company is a member of multiple associations, it may submit the disclosure form to any one association with due intimation to the other industry associations about such submission. The company is required to continue submitting to the same association in subsequent years, unless it ceases to be a member of that association and decides to start submitting the marketing expenditure disclosures to another association. In this scenario, the company would be required to formally notify both the DoP and the concerned associations of such change. For companies not affiliated with any association, disclosure must be made by the company directly on the DoP’s UCPMP portal.

The revised Annexure, which replaces the earlier Annexures to the UCPMP, continues to retain the requirement for disclosure of expenses incurred for distribution of free samples, undertaking continuous medical education or continuing professional development programs (“Education Programs”) on an annual basis. However, as an additional requirement, Companies are also required to disclose the methodology adopted for calculating the expenditure incurred for such activities in addition to the disclosure on the Education Programmes organised through third parties including associations.

The decentralisation of compliance functions to industry associations, along with the shift from monthly to annual reporting, is likely to significantly reduce the administrative and compliance burden on pharmaceutical companies, while still preserving regulatory oversight and aligning with the broader intent of the UCPMP.

Publication of Complaint Details

Previously, the UCPMP required that details of complaints received by industry associations and the decisions of the Ethics Committee for Pharmaceutical Marketing Practices (“ECPMP”) to be uploaded both on the association’s website and the UCPMP portal maintained by the DoP.

As a relief to the industry, the UCPMP Circular removes the requirement to publish these details on the UCPMP portal and the DoP website by the associations. While associations may continue to maintain internal records, public disclosure via the DoP's platform is no longer necessary.

Data Security and Retention by Industry Associations

The UCPMP Circular introduces an additional requirement for industry associations to implement systems that securely store and protect data submitted by their member companies. This data must be retained for a minimum period of five (5) years, or longer if necessary to support investigations or decisions related to complaints or proceedings before the ECPMP, the Apex Committee, judicial courts, or other relevant authorities. Associations are also required to share this data upon request from these bodies.

While this measure ensures continuity in enforcement by maintaining access to relevant records over time, enabling quicker regulatory response in cases of complaints or investigations, it may also raise concerns around data privacy and confidentiality, particularly with respect to commercially sensitive information.

Industry associations will need to implement robust data protection and access control measures to mitigate the risk of unauthorised disclosure or misuse of the data.

III. Conclusion

In conclusion, the UCPMP Circular issued by the DoP strikes a balanced approach by streamlining compliance requirements while retaining necessary regulatory oversight. It provides much needed clarity on the manner of valuation of free samples distributed by companies, while further clarity on the disclosure of company revenue for group companies comprising of various divisions remains to be provided by the DoP. However, by easing the administrative burden, these changes will promote more effective adherence to the UCPMP by pharmaceutical companies.

 

Author

- Life Sciences Team

You can direct your queries or comments to the relevant member.

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¹Accessible at: https://pharma-dept.gov.in/sites/default/files/Circular%20No.%203%20of%202025%20and%20UCPMP%202024%20as%20amended.pdf (last accessed on September 3, 2025)