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BT Buzz: What's ailing coronavirus rapid test kit imports

Joe C Mathew     April 28, 2020

Key Highlights:

  •     US-based coronavirus rapid kit maker alleged its product got import licence without its authorisation
  •     Indian licence holder said approval received from German distributor
  •     The tussle highlights issues in granting hurried regulatory approvals to rapid test kits

The representative of Biomedomics Inc, a US rapid diagnostic kit maker for novel coronavirus (COVID-19), has approached the Drugs Controller General of India (DCGI) with a complaint that the import licence for the company's COVID test kit was given to a local entity - Biohouse Solutions Pvt Ltd - without its approval. The company official has also filed an e-FIR with Noida Police against Gurgaon-based Biohouse for obtaining the licence from DCGI without its permission. It has sought cancellation of the licence.

In a response to Business Today, Biohouse downplayed the allegation, saying the company has an exclusive agreement with a German firm Human GmbH which in turn has a worldwide distribution agreement with Biomedomics Inc for sale and distribution of the rapid test kit across the world except China, USA and Japan. In other words, a specific and direct approval from Biomedomics was not required.

While the legality of the issue will get sorted out in the coming days, one thing is certain that the scramble for a share in the thriving business of rapid diagnostic kit supplies for COVID-19 is leaving several grey areas for potential legal tussles. Besides, it raises questions on the scrutiny and approval process followed by Indian regulators in their attempt to get  as many rapid diagnostic kits as possible to expand the scale of COVID-19 tests carried out in the country. Rapid test kits are meant to help surveillance of the disease outbreak at a community level.

In fact, there are several reasons to argue that all is not well with India's COVID rapid test business ecosystem.

For instance, the Indian Council of Medical Research (ICMR), within weeks of giving approval to import rapid test kits, has asked the state governments to stop using the kits of two companies -- Guangzhou Wondfo Biotech and Zhuhai Livzon Diagnostics -- after evaluation of the performance of the kits in field conditions showed wide variation in their sensitivity, a complaint refuted by at least one company, Wondfo. The last few days also saw Delhi High Court hearing a trade dispute between the distributor and importer of Wondfo's test kit and a court verdict slashing the price charged to ICMR by 33 per cent as it was found to be too high compared to the landed price. There was also an instance of Andhra Pradesh government acting against the local firm that had bagged a tender to supply rapid test kits from a South Korean company S D Biosensors after it was found that the price quoted by the local supplier was almost double of what the Korean company directly quoted the Chhattisgarh state government a few days ago.

The emerging tussle between the representative of Biomedomics and the local import licence holder points to yet another potential worry - the quality of scrutiny done by the DCGI before giving licence to import Biomedomics' product COVID-19 IgM-IgG Rapid Test. It becomes extremely important as the office of the DCGI or the Central Drugs Standard Control Organisation (CDSCO), as on April 27,  granted 100 approvals for import of rapid / CLIA/ ELISA kits for testing of COVID-19. In many cases multiple companies have been granted import licenCes for the same product. This includes the approval for BioHouse Solutions to import the test kit produced by Biomedomics.

Vivek Chandra, CEO, BioHouse says the company has absolute clarity on their position. "Human GmbH (their German partner) furnished all the required documents for taking import license from CDSCO to Biohouse which BioHouse submitted to CDSCO in proper formats and as per the due process. The product which will come to BioHouse from Human GmbH will bear both Biomedomics and Human logo," Chandra says, adding that other companies that have similar distribution licences with Biomedomics (and companies with whom Biomedomics have direct distribution pact) may also vie for the Indian market.

Kanishk Kharbanda Head - India, Middle East & Africa of Biomedomics, insists that since his company "has not conducted any commercial transaction with the licence holder, it will not take any responsibility for the quality or performance of the test kits supplied by the licence holder".

Biomedomics was among the first two companies shortlisted by the ICMR in early March for procurement of the COVID rapid test kits. However, unlike the other company Wondfo, it is yet to import a single kit to the Indian market. While Chandra says the import has not happened due to capacity constraints at BioMedomics facility in China, Kharbanda points out that the recent export restrictions imposed by China not allowing exports of the product legally until the manufacturing entity is fully compliant with the requirements of the National Medical Products Administration, Government of China. Further, Kharbanda says, the company will not apply for an import licence with the DCGI until the regulatory compliance in China is complete.

Incidentally, this is the second instance where BioMedomics is finding "unauthorised" players seeking approvals for supplying its product in India. On April 4, Kharbanda had to write to ICMR to not proceed with a purchase order issued by the government agency to an Indian company for supply of its rapid test kit without its approval.

Industry sources say the government's decision to rush through the approval process by relaxing several documentation requirements (a product approved in US or EU, for instance, do not need a quality approval from India before it can be imported for commercial supplies) has allowed several firms, big and small, to try their luck with rapid kit business. This has created confusion in the market, raising doubts on the quality of the product, and at times, allowing price variations that look implausible in a normal situation.

The fight between Biomedomics and Biohouse is perhaps a reflection of this confusion.

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