Last Updated on January 14, 2024 by The Health Master
The Department of Pharmaceuticals (DoP) has revised the guidelines for the production-linked incentive (PLI) scheme for promoting domestic manufacturing of medical devices, dividing the eligible products into two categories and allocating incentives separately for them.
The revised guideline has an addition to the definition of the applicant, under which the applicant applying for products listed in Annexure 1 of the guideline shall be referred to as Category A applicant, and those applying for products in Annexure 1A shall be referred to as Category B.
Changes are made in other clauses and Annexures based on this revision.
While in the previous guidelines issued on October 29, 2020, the indicative eligible products for the Cancer Care/radiotherapy medical devices segment were listed as brachytherapy systems, rotational cobalt machines, radiotherapy simulation systems, linear accelerator (LINAC), workstations – radiotherapy planning, proton therapy system and other products, under the revised guideline, rotational cobalt machine, and LINAC are in Category A and the rest of the products are in Category B.
The similar division has been applied in the other three segments – radiology & imaging medical devices (both ionizing and non-ionizing radiation products) and nuclear imaging devices; Anesthetics and cardiorespiratory medical devices including catheters and renal care medical devices; and all implants including implantable electronic devices.
If the selected applicants of Category A withdraw or get rejected with the approval of the Empowered Committee, the products applied by those applicants withdrawn or got rejected (if there are no applicants for the same products as approved in earlier rounds), shall automatically be included under Annexure 1A and may be made available for Category B applicants to apply.
In the previous guideline, the eligibility threshold criteria for the applicants were from the Fiscal Year 2022-23 to the Fiscal Year 2026-27 with a five percent rate of incentive on incremental sales of manufactured goods each year.
The maximum incentive was Rs. 121 crores during the five years.
However, in the revised guideline, while the threshold criteria for Category A stands the same, the threshold criteria for Category B applicant has been added with the same rate of incentive on incremental sales of manufacturing goods applicable for each year.
The category will also have a total maximum incentive of Rs. 40 crores for the five years.
The eligible applicants for Category A would be with Rs. 60 crores or above global medical devices manufacturing turnover company-wise or groups company-wise for the fiscal year 2018-19. For every additional Rs. 60 crore global manufacturing turnover, a score of five will be added.
An eligible applicants for Category B should have Rs. 20 crores or above global medical devices manufacturing turnover as a company or group company for the fiscal year 2019-19. For every additional Rs. 20 crore manufacturing turnover, a score of five would be added.
The application window for the PLI scheme according to the previous guideline ended on November 30, 2022, but the revised guideline has provisions to keep the application window open based on notice issued by the Department from time to time.
The previous guideline fixed that a maximum of 28 applicants shall be selected under the scheme, with a maximum of 10 applicants under each target segment.
According to the revised guidelines, the number of applicants shall be selected under the scheme based on the availability of outlay approved under the scheme.
The department has earlier said that with an objective to boost domestic manufacturing, and attract large investment in the Medical Device Sector, it had launched a production-linked incentive (PLI) scheme for the promotion of domestic manufacturing of medical devices to ensure a level playing field for the domestic manufacturers of medical devices with a total financial outlay of Rs. 3,420 crores for the period 2020-21 to 2027-28.
In the first round, 28 applications were received from 23 applicants under the scheme.
Out of which, 13 applications with committed investment of Rs. 798.93 crores by the Companies were approved with an expected employment generation of around 3,812 persons.
Since few slots remained unfilled for certain products, applications were invited again with the last date of submission as August 31, 2021, and a total of 14 applications were received.
It has approved eight plants in an EC meeting held on November 25, 2021. The DoP has recently released a list of 21 applications approved under the scheme till then.
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