Patient consent to participate in clinical trials of new drugs in India will have to be recorded, and other patient protection measures implemented before new and ongoing clinical trials are allowed to proceed says India’s top court.

The Indian Supreme Court permitted just five of 162 clinical trials to resume after they were halted at the end of September due to allegations by the court that naïve patients were used as “guinea pigs” by multinational companies, and unaware of the risks involved in their participation. Studies for the other 157 drugs must first pass inspection by a new government advisory committee before moving ahead. The court has tasked the committee with evaluating how the new compounds compare to drugs already on the market in India and whether or not they meet a need of the Indian people.

In the wake of the rulings, several pharmaceutical companies said they would consider moving their trials to other countries. “The Supreme Court ruling that halts clinical trials until a monitoring system is in place is a deterrent to drug innovation that can have an irretrievable impact on the ability of India to partake in new drug development as it will lead to an exodus of innovators,” Biocon CEO Kiran Mazumdar-Shaw told The Indian Express.

The two judge panel admonished the government for its lax oversight saying that clinical trials conducted in India must help its population rather than just be for the benefit of others.

In the early 2000s, India, with its large drug-naïve population, was seen as a top country for clinical trials. But by 2010 allegations of misconduct began surfacing when it was reported that a late stage trial of an HPV vaccine had enlisted girls unaware of what was going on, and was suspended after seven of the girls died.

In documents submitted by the Drugs Controller General of India to the Indian Supreme Court, 11,972 adverse effects—excluding deaths—were reported in the period from 2005 to mid 2012. The government admitted that during that time, 2,644 people died during clinical trials for 475 new drugs.

The unstable regulatory environment in the country has left the $500 million industry functioning at one-fifth of its capacity. Although India’s health ministry has amended its Drugs and Cosmetics Act with new provisions for regulation and ethical supervision of trials, several clinical trial sponsors, including the U.S. National Institutes of Health, have cancelled trials and moved them to Malaysia and Canada.