With the growing middle class and increasing world class
healthcare facilities, India has emerged as one of the largest medical device
markets in Asia and is rallying ahead in this field with striking rate. The medical
device market in India is expected to grow with a rate 15% per year for the
coming years. Selling of medical devices in India requires compliance with Indian
Medical Device regulations. Foreign companies cover 70% of the medical device
market in India.
For the first time after 2005,
medical devices have been regulated under Drugs and Cosmetics Rule in India,
which is under the control of Central Drugs Standard Control Organization
(CDSCO) headed by Drug Controller General of India (DCGI). The manufacturers of
medical devices either from India or from International market require their
prior market authorization in US, Canada, Europe, Australia, Japan or any other
international market as well as proof of approval in their home market, in
order to register the device in India.
National Pharmaceutical Pricing
Authority (NPPA) of India controls the prices of drugs and other products in
India. The essential drugs are regulated under a Drug Price Control Order
(DPCO) in India, to make them affordable to poor patients. In recent past, the Maharashtra
Food and Drugs Administration (FDA) has recommended to the DCGI and NPPA to
bring the medical devices in India under DPCO. This recommendation came in the
wake of some studies conducted by the Maharashtra FDA in which it was found
that manufacturers in collusion with importers, distributors and hospitals
which ultimately provide the devices to the patients and fixes maximum retails
price (MRP) of medical devices randomly which is finally passed on to credulous
patients. Specially, in the case of drug eluting stents (DES), MRP was found to
be exorbitantly high and patients have no option but buy it without any
bargain. MRP of the devices are fixed in India by the importers and not the
manufacturers. There is one more startling fact associated with the costing
that, the cost of devices is recovered immediately from patients (sometimes
even before implantation in patients), but the payment to distributors are made
after a period of 60-120 days, and applicable taxes to the state government are
made only within 51 days by the distributors.
In
one case of overpricing it was found that a DES imported in India at around Rs.
31,000 has an MRP of Rs. 1,62,000, it was sold to distributor for Rs. 67,000
and in turn the DES is provided to hospital at a price of Rs. 1,06,650 by the
distributor which was in turn sold to patients.
In
yet another case of profit making practice by the importer, A DES imported from
Europe for Rs. 40,710 has an MRP of Rs.
1,50,000, a mark-up of more than 250%, was sold to a distributor at Rs. 73,440
and in turn sold to the hospital at Rs. 1,13, 400 and the patient paid a price
of Rs. 1,19,070.
These devices are generally not
available freely in the market and patients get the supply from hospitals at
their quoted price through distributor and are forced to pay double or triple
the price at which it has been imported. It has also been reported that
distributor bribe doctors and hospitals from the extra money through selling at
higher prices.
NPPA
has taken steps recently in response to the recommendation from Maharashtra FDA
about the price violation of these devices; especially FDA demanded a price cap
on DES and orthopaedic implants. It is recommended that most effective way to regulate
the price of these devices is to bring them in National List of Essential
Medicines (NLEM), which can bring relief to millions of patients. In India two
medical devices – intra uterine device and condoms are already covered under
NLEM and their prices are under control.
Role of NPPA in this regard can be
effective in this scenario to bring relief to the common middle class
population of this country.
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