Industry

Govt revises guidelines for PLI scheme for Medical Devices

This is a change from previous rounds where investments made on or after April 1, 2020 were considered.

The Health Master

March 1, 2023

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Last Updated on December 30, 2023 by The Health Master

Revised guidelines for PLI scheme for Medical Devices

Download DoP guidelines dated 25-02-2023 on PLI Scheme for Medical Devices, the link is given below: The Department of Pharmaceuticals (DoP) has recently released revised guidelines for the Production Linked Incentive (PLI) scheme for promoting domestic manufacturing of medical devices in India.

Download DoP guidelines dated 25-02-2023 on PLI Scheme for Medical Devices

The new guidelines aim to encourage domestic production of high-quality medical devices by providing financial incentives to eligible applicants. Here are the key changes in the revised guidelines:

Clinical trial cost considered as investment

Under the new guidelines, the cost incurred by applicants towards clinical trials of eligible products in India will be considered an investment, determining eligibility for selection under the scheme.

However, this investment will be capped at a maximum of 10% of committed investment for an approved applicant, irrespective of whether it is capitalized or not.

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Change in investment provisions

The guidelines have also changed the provisions related to investment required for determining the eligibility of the applicant for the scheme.

For those who apply for incentives in the fourth round of invitations from the Department, eligibility would be based on the investment made on or after April 1, 2021.

This is a change from previous rounds where investments made on or after April 1, 2020 were considered.

Incentive applicable for in-house consumption of eligible products

The new guidelines have added provisions related to in-house consumption of eligible products, which was not present in the previous guidelines.

The incentive applicable is calculated by multiplying the net incremental sales of eligible products with the rate of incentive.

In case of in-house consumption of eligible product by the selected applicant, the net sales of eligible products shall mean the actual cost of production of the said product, as certified by a cost accountant who is a member of the Institute of Cost Accountants of India.

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Flexible claim submission

The revised guidelines allow the applicant to submit a claim in three months, six-months, nine months, or full-year period as against the clause in the previous guidelines where the applicants could only submit the claim on a half-yearly or annual basis, that is for the period of April to September and October to March, or April to March.

Eligible products under Category B

Under Category B of applications, the revised guidelines have mentioned eligible products in the radiology and imaging medical devices – both ionizing and non-ionizing radiation products – and nuclear imaging devices, among others including:

Cyclotrons,
Positron emission tomography (PET) systems,
Single photon emission tomography (SPECT),
X-ray tube.

Conclusion

The revised guidelines for the PLI scheme for promoting domestic manufacturing of medical devices provide significant flexibility and incentives for eligible applicants.

The DoP has invited applications from eligible companies for Category B of devices, implementing the revised guidelines and investment timelines.

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