No price regulation on these Medical Devices: Govt

Till 2019, only 24 medical devices were notified as drugs. And out of that only four items were included in the list of NLEM

Govt DoP

Last Updated on September 8, 2021 by The Health Master

The pricing regulations on medical devices are restricted to a few products and the industry is free to fix the maximum retail price for their products.

The listed products should not increase the prices above 10 per cent as per the pricing regulations, said a senior official from the Department of Pharmaceuticals (DoP).

Addressing the medical technology industry representatives in a plenary session on demand generation, triggering the growth of med tech industry, organised by Confederation of Indian Industry (CII) in its 13th Global MedTech Summit, H K Hajong, economic advisor with DoP said that there is a concern from the industry on pricing policy for medical devices.

Till 2019, only 24 medical devices were notified as drugs. And out of that only four items were included in the list of NLEM.

“Since April 2020, all the medical devices are notified as drugs, and we are crossing around 6,000 medical products. There is no price regulation, because they are all treated as non-scheduled drugs and there is no price control,” he said.

In June, 2021, the Department brought five products namely pulse oximeter, blood pressure monitoring machine, nebuliser, digital thermometer and Glucometer under Trade Margin Rationalisation (TMR). This is the only control the department has brought in during this period.

“The role of the Department through NPPA is to monitor the annual increase in MRP, which does not want to go beyond 10 per cent of the MRP anyway. There is no other interference from the department.

Companies are free to fix their MRP and except these four items in the NLEM and some items in the exceptional list under TMR, the rest are left free for fixing prices. Of course, the 10 per cent annual increase is the ceiling which we watch from the NPPA’s side,” he averred.

From the demand side of medical devices, he said that there has been an interplay of different factors for demand generation including demographic changes, income generation with increasing middle class, growth of health insurance, and the nature of global market.

Two important factors in terms of industry to grow its share in the global market, are the cost effectiveness and quality of the products. Technology and R&D has a big role in the growth of the industry.

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There are a few initiatives taken by the department on the supply side. The medical device sector is highly dependent on imports and challenges are with single source products. The government is looking at resilience in the supply chain and improving self reliance through Atma Nirbhar Bharat.

Through the PLI scheme for medical devices, the government has incentivised the industry at the rate of five per cent on the incremental sales and four sectors have been mentioned including cancer care and radiotherapy, radiology and imaging, anaesthetics and cardio respiratory and renal care and finally, the fourth on implants.

It is expected that the PLI schemes into the sector, all together will see a Rs. 40,000 crore investment over a period of four to five years. That can do a lot to the industry, it is yet to be seen how the industry and investors respond to our scheme.

“If it goes as our expectation, I think it should bring a lot of change to the medical device industry. The National Medical Device Council has also been set up under the chairmanship of Secretary, DPIIT.

This is to promote local manufacturing of high end devices and attract investment. We have a 100 per cent FDI policy, which is automatic. We are very hopeful that we can attract a lot of investments into the sector,” he added.

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