NPPA extends ceiling price fixation on orthopaedic Knee Implants

The ceiling price was applicable till September 15, 2022, according to an earlier notification.

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NPPA Price of drugs
NPPA

Last Updated on September 18, 2023 by The Health Master

The National Pharmaceutical Pricing Authority (NPPA) has extended the ceiling price it imposed on orthopaedic knee implants for a knee replacement system in August 2017, to one more year from September 16, 2022.

The ceiling price was applicable till September 15, 2022, according to an earlier notification.

The price regulation was imposed by the NPPA through a notification on August 16, 2017, which was extended through notifications in the subsequent years, and the last order was issued on September 10, 2021.

The drug price regulator in its latest order said, “This order shall be applicable for the period of one year from September 16, 2022, unless revised by another notification.” The ceiling prices for orthopaedic knee implants will be reviewed after a period of one year”.

Earlier, the Union Ministry of Health and Family Welfare, vide its S.O. 1468 dated October 6, 2005, notified the orthopaedic implants as’ drugs’, and the DPCO, 2013, is applicable to all notified drugs (including notified devices).

The NPPA is mandated to monitor the prices of these drugs under paragraph 20, so as to ensure the availability of such drugs (i.e. notified devices) and also ensure that no unethical profiteering is happening in case of any drugs (i.e. notified devices) at the cost of patients.

In its order on August 16, 2020, NPPA said that it has “noticed that orthopaedic knee implants are having unjustified, unreasonable, and irrational high trade margins leading to their exorbitant prices which affects the out-of-pocket expenses of patients and lakhs of patients are not able to pay for arthroplasty procedures because of these exorbitant prices and suffering in pain.”

The estimate of such patients requiring arthroplasty intervention, both diagnosed and undiagnosed, is about Rs. 1.5 to 2 crore, out of which only about Rs. 1 lakh plus well-off patients are in a position to pay for it every year.

It has also been noted that osteoarthritis is likely to become the fourth leading cause of disability by the year 2020, as per the W.H.O Bulletin, 2003, 81,(9) and India is likely to be one of the leading countries of such immobilized citizens in terms of numbers. Preventing such a scenario is essential in individual as well as national interest, it said.

In this context, the NPPA carried out an exhaustive stakeholder’s consultation on the issue of the exorbitant cost of orthopaedic knee implants and excessive trade margins, and analysis of “trade margins’ in the market for knee implants was uploaded in the public domain for the sake of transparency and in the spirit of people’s right to information.

Following this, the drug price regulator, in its authority meeting held on August 10, 2017, which continued on August 14, 2017, after duly examining in detail, has decided that it is necessary to control the excessive trade margins to fix the ceiling price of orthopaedic knee implants, which is fair and reasonable based on the intrinsic value of the implants with rational margins to protect the public interest.

This was after deliberating and considering all available information/data/viewpoints and all relevant options for price fixation of orthopaedic knee implants, under the present extraordinary circumstances of a failed and exploitative market because of information asymmetry between the patient and healthcare delivery system, it opined.

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