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Mon, Dec 29 2025
Raju Karn
In India, setting up a pharmaceutical manufacturing unit involves heavy investment, infrastructure, and regulatory compliance. But what if you want to manufacture drugs without owning a factory?
That's where a Loan License comes in.
In this detailed 2025 guide, you’ll learn what a Loan License is, who can apply, what documents are required, the complete approval process, validity, and how PSR Compliance can assist you in getting licensed faster.
A Loan License is issued under Rule 69A of the Drugs and Cosmetics Rules, 1945 It allows a company to manufacture drugs using another company’s manufacturing facility, without owning the plant itself.
In simple words:
You can “borrow” a manufacturing unit and still legally market the medicines under your brand.
This model is widely used in India by startups, marketing companies, and exporters.
You should apply for a Loan License if you:- Are a pharma marketing company without your own plant- Want to outsource manufacturing to a third party- Need approval to legally label and sell under your brand- Want to avoid upfront investment in infrastructure
Here’s a list of documents typically required for obtaining a Loan License:
- Application Form (Form 27A)- Company Registration Certificate- PAN and GST of the firm- Site Master File (prepared jointly with manufacturer)- Details of technical staff (production & quality control)- Power of Attorney / Agreement with the manufacturer- List of products to be manufactured- Copy of trademark certificate(if applicable)
- Valid Manufacturing Drug License- WHO-GMP certificate (if required)- Approved layout plan of manufacturing unit- Consent to use premises- Equipment & testing facility details- Staff qualification certificates- Pollution NOC(if applicable)
Tip : Ensure the manufacturing unit you choose is fully compliant and already licensed for the category of drug you wish to produce.
Here’s how the Loan License registration process works:
Enter into a contract with a manufacturer having a valid drug manufacturing license and infrastructure.
Collect all required documents from both parties (you + manufacturer).
Apply through the State Drug Control Department portal or CDSCO(if applicable) using Form 27A.
Authorities may inspect the manufacturing premises, validate staff, records, and equipment.
Pay the required government fees and submit challan.
Once approved, you receive a Loan License for the listed products and categories.
Typical timeline: 30–90 days, depending on state & documentation.
- The Loan License is valid for 5 years
- It is renewable before expiry
- Renewal should be filed within 6 months of expiry date
- You must maintain a valid agreement with the manufacturing unit throughout the license period
Note: Fee may vary by drug category (Allopathic, Ayurvedic, etc.) and state.
- Choosing a non-compliant or blacklisted manufacturer
- Incomplete agreement or improper documentation
- Mismatch in product list and actual site capability
- Lack of qualified staff details
- Delay in renewal filingPSR Compliance helps you avoid rejection and speed up approval.
- Tablets, Capsules, Syrups
- Ointments, Creams, Injectables
- Ayurvedic & Herbal Products
- Nutraceuticals (if covered under Drug Rules)
- Veterinary medicines
(Subject to manufacturer’s license scope)
At PSR Compliance , we assist pharma professionals, entrepreneurs, and marketing companies with:
✔️ Manufacturer identification & tie-up
✔️ Agreement drafting
✔️ Application preparation & online filing
✔️ Follow-ups & license tracking
✔️ Renewal & product endorsement
Q1. Can a marketing company apply for a loan license?🅰️ Yes, any legally registered entity can apply if partnered with a licensed manufacturer.
Q2. Is WHO-GMP mandatory for loan license?🅰️ It depends on your market. For exports, WHO-GMP is usually required.
Q3. Can I manufacture multiple products under one loan license?🅰️ Yes, but each product must be approved and listed during application.
Q4. What if I change the manufacturer?🅰️ You’ll need to apply for an endorsement or fresh loan license with the new unit.
Q5. Can I apply online for loan license?🅰️ Yes, most state drug departments and CDSCO offer online filing portals.