Be Careful! Here are the Conditions for Legal Production of Medicines

Corporate Secretary Service Indonesia – Health is one of the most important aspects of human life. In maintaining and improving health, one very important element is the use of medicines. Therefore, in terms of ensuring consumer safety and protection, every pharmaceutical business that produces medicines must comply with the provisions of laws and regulations.

And most importantly, medicines distributed in the broad market must have a distribution permit from the Food and Drug Administration or Badan Pengawas Obat dan Makanan (BPOM).

However, currently there are many illegal drugs found in the market and sold freely. Illegal drugs including narcotics, psychotropic substances, and various other prohibited substances can have a negative impact on society. So, what are the business regulations for producing drugs?

Legal Basis for the Provisions of Producing Medicines Legally

The following are some of the regulations governing legal drug production, namely:

• Food and Drug Administration Regulation No.24/2017 on Criteria and Procedures for Drug Registration (BPOM Regulation 24/2017), which has been amended four times (most recently BPOM Regulation No. 15/2013).
• Food and Drug Administration Regulation No. 34/2018 on Guidelines for Good Manufacturing Practices (NA-DFC Regulation No. 34/2018).

Some of the provisions that must be carried out by pharmaceutical business actors in producing medicines legally include the following:

Risk-Based Business Licensing

Based on Government Regulation Number 5 of 2021 concerning the Implementation of Risk-Based Business Licensing (PP 5/2021), every business actor is required to have a business license in accordance with business risk criteria based on the Indonesian Standard Industrial Classification (KBLI) code. The pharmaceutical industry is included in KBLI 21012 entitled “Pharmaceutical Products Industry for Humans”, with a low to medium low risk level.

Read Also: Permit and Regulation Guide for Cosmetics Business

In addition, there is also KBLI 21011 with the title “Pharmaceutical Materials Industry for Humans”, with a high level of business risk. The types of risk-based business licenses for each risk level include (PP 5/2021):

• Low risk: Business Identification Number (NIB).
• Low medium risk: NIB and Standard Certificate based on business actors’ self-declaration.
• High medium risk: NIB and Standard Certificate verified by the Central Government and/or Local Government.
• High risk: NIB and License.

Distribution Permit

Furthermore, the legal production of medicines is to have a drug distribution license. A distribution permit is a form of registration approval to be distributed in the territory of Indonesia (Article 1 point 7 of BPOM Regulation 24/2017). In the risk-based business licensing regime, the distribution permit applies as a Business License to Support Business Activities (PB UMKU).

The domestic pharmaceutical industry must obtain a drug distribution license that meets the following general requirements (Article 8 of BPOM Regulation 24/2017):

1. Have a pharmaceutical industry license, but exempted for:

• Registration of domestically produced drugs carried out by prospective pharmaceutical industries that are under construction.

2. Having a valid Cara Pembuatan Obat yang Baik (CPOB) certificate in accordance with the type and dosage form being registered, but excluded for:

• Registration of domestically produced drugs carried out by prospective pharmaceutical industries that are undergoing development
• Registration of domestically produced drugs carried out by pharmaceutical industries that add facilities for new dosage forms or pharmaceutical industries that expand production facilities.

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