How to Apply for a Drug Licence in India: CDSCO Process and Fees

India's pharmaceutical sector is one of the largest in the world, and every entity involved in the manufacture, sale, stocking, or distribution of drugs must hold a valid licence. The drug licensing system exists to ensure that only qualified persons handle pharmaceutical products and that drugs reaching consumers meet prescribed quality and safety standards.

This guide explains the complete process for obtaining a drug licence in India in 2026, covering both retail and wholesale licences issued by state authorities and manufacturing and import licences issued by the Central Drugs Standard Control Organisation (CDSCO).

Legal Framework: The Drugs and Cosmetics Act 1940

Drug licensing in India is governed by the Drugs and Cosmetics Act 1940 and its associated rules, specifically the Drugs and Cosmetics Rules 1945. This legislation regulates the import, manufacture, distribution, and sale of drugs and cosmetics throughout India. The Act establishes a dual regulatory structure: the State Drug Licensing Authority (SDLA) handles retail and wholesale licences, while the Central Drugs Standard Control Organisation (CDSCO), headed by the Drugs Controller General of India (DCGI), oversees manufacturing licences and import authorizations.

Recent amendments have significantly modernized the licensing framework. The New Drugs and Clinical Trials Amendment Rules 2026 have streamlined approval processes for pharmaceutical companies.

Types of Drug Licences in India

Retail Drug Licences: Form 20 is issued for the retail sale of drugs other than those listed in Schedule C, C1, and X. Form 21 covers the retail sale of Schedule C and C1 drugs (biologicals, sera, vaccines, and other specified drugs requiring cold storage).

Wholesale Drug Licences: Form 20B permits wholesale dealing in drugs other than Schedule C, C1, and X drugs. Form 21B covers wholesale dealing in Schedule C and C1 drugs.

Manufacturing Licences: Form 25 and Form 28 are issued by CDSCO for manufacturing drugs for sale or distribution. These require compliance with Good Manufacturing Practices (GMP) as specified in Schedule M of the Drugs and Cosmetics Rules. The CDSCO has also been strengthening enforcement against unlicensed medical devices including IVF and ART equipment.

Import Licences: Form 10 and Form 10A are required for importing drugs into India and are issued exclusively by the CDSCO.

Application Process for Retail and Wholesale Drug Licences

Step 1: Determine the Licence Type. The first step is identifying which licence category applies. A retail pharmacy selling prescription medicines requires Forms 20 and 21. A wholesale distributor supplying drugs to retailers needs Forms 20B and 21B. If the business will handle Schedule X drugs (narcotics and psychotropic substances), a separate licence under Form 19C is required.

Step 2: Ensure Premises Compliance. The premises must meet specific requirements set by the state drug authority. For retail pharmacies, a minimum area (typically 10 square metres) with adequate shelving, a dispensing counter, refrigeration for Schedule C drugs, and proper ventilation is mandatory. A qualified registered pharmacist must be employed and present during business hours.

Step 3: Submit Application on the State Drug Control Portal. Applications are submitted using Form 19 for a standard retail or wholesale drug licence. Alternative forms include Form 19A for a restricted licence (where a pharmacist is not available, limited to a specified list of drugs), Form 19B for homeopathic medicines, and Form 19C for Schedule X controlled substances. Most states now accept online applications through their respective drug control department portals.

Step 4: Upload Required Documents. The application must be accompanied by proof of premises (ownership deed or rental agreement), the pharmacist's qualification certificate and registration with the State Pharmacy Council, a detailed site plan of the premises showing storage areas, an affidavit declaring compliance with the Drugs and Cosmetics Act, identity proof and photographs of the applicant, and a partnership deed or certificate of incorporation if the applicant is a firm or company.

Step 5: Pay Government Fees. The prescribed fee must be paid at the time of application. For retail licences (Forms 20 and 21), the fee is approximately Rs 3,500. For wholesale licences (Forms 20B and 21B), the fee is similarly around Rs 3,500. Exact amounts vary by state. This process is comparable to other regulatory licensing frameworks such as FSSAI food licensing and its recent amendments.

Step 6: Inspection by Drug Inspector. After the application is processed, a Drug Inspector visits the premises to verify compliance with prescribed standards. The inspector checks storage conditions, temperature maintenance equipment, record-keeping systems, the availability of the qualified pharmacist, and overall hygiene and safety of the premises.

Step 7: Licence Issuance. Upon satisfactory inspection, the licence is issued in the appropriate form. The licence must be displayed prominently at the licensed premises.

Licence Validity, Renewal, and Qualified Person Requirements

Under the amended Rule 63 of the Drugs and Cosmetics Rules, drug licences in India now have perpetual validity, subject to payment of a retention fee every five years. This is a significant change from the earlier system where licences had to be renewed periodically. Failure to pay the retention fee results in the licence being deemed suspended until the fee is cleared.

A registered pharmacist is mandatory for retail drug stores. The pharmacist must hold a valid registration with the State Pharmacy Council and be physically present at the premises during all operating hours. For manufacturing units, a competent technical person (with prescribed qualifications in pharmacy or pharmaceutical chemistry) must supervise production operations. Manufacturers must also comply with BIS quality control orders and mandatory certification requirements where applicable.

Schedule H, Schedule X Drugs, and Additional Restrictions

Schedule H drugs are prescription-only medicines that can only be sold against a valid prescription from a registered medical practitioner. These include antibiotics, hormonal preparations, and other potent drugs. Schedule H1 (introduced later) imposes even stricter requirements for certain antibiotics and anti-TB drugs, mandating detailed record-keeping of each sale with the patient's name, prescriber's details, and quantity dispensed.

Schedule X drugs (narcotics and psychotropic substances such as amphetamines, diazepam, and alprazolam) carry the most stringent controls. A separate licence under Form 19C is required, and every sale must be recorded in a dedicated register with the prescription retained for two years. Non-compliance with Schedule X requirements can result in prosecution under both the Drugs and Cosmetics Act and the Narcotic Drugs and Psychotropic Substances Act 1985.

Processing Timeline and Penalties

The typical processing time for a retail or wholesale drug licence is 15 to 30 working days from the date of complete application submission, though this varies by state. Manufacturing licences from CDSCO may take longer, particularly if GMP inspection and plant approval are involved.

Selling, stocking, or distributing drugs without a valid licence is a criminal offence under Section 27 of the Drugs and Cosmetics Act 1940. Penalties include imprisonment for a term that may extend to three years and a fine. For adulterated or spurious drugs, penalties are far more severe, extending to life imprisonment. The broader trend of decriminalizing minor regulatory offences under the Jan Vishwas Amendment Bill 2026 has not affected the core criminal provisions of the Drugs and Cosmetics Act, which continue to carry stringent penalties.

Cases involving medical negligence, including liability under the Bolam test, may also arise where unlicensed drug sale results in patient harm.

Key Takeaways

Drug licences are mandatory for every entity involved in the sale, distribution, or manufacture of drugs in India under the Drugs and Cosmetics Act 1940. The licensing authority depends on the activity: state authorities for retail and wholesale, CDSCO for manufacturing and imports. Licences are now perpetual under amended Rule 63, with a retention fee due every five years. A registered pharmacist is compulsory for retail operations. Schedule H, H1, and X drugs carry additional record-keeping and prescription requirements. The penalty for operating without a licence includes imprisonment up to three years and a fine under Section 27 of the Act. Proper documentation, a compliant premises, and a qualified pharmacist are the essential prerequisites for a successful application.