High costs of 24 medical devices trigger suspicion; govt seeks price details

India's medicine price regulator National Pharmaceutical Pricing Authority (NPPA) has given three weeks' time to manufacturers and importers of 24 categories of medical devices to furnish pricing details of all such products.

In a directive on February 16, NPPA said it has the mandate to monitor, and if needed in public interest, regulate maximum retail prices (MRP) of medical devices that are notified by the government as drugs. Currently, 28 categories of medical devices are under the purview of mandatory regulation by the authority. 

While the prices of four categories of medical devices - coronary stents, drug-eluting stents, condoms, and intrauterine devices - are already fixed by NPPA, the prices of the rest are fixed by the manufacturers themselves. The authority now seeks to monitor the price movement of all 24 categories of medical devices.

The product categories for which NPPA has sought information include nebulizer, blood pressure monitoring machine, digital thermometer, glucometer, surgical dressings, blood bags, in vitro diagnostic devices of HIV, HbsAg and HCV, disposable hypodermic syringes etc.

Commenting on the directive, Rajiv Nath, coordinator, Association of Indian Medical Device Industry (AiMeD) said that while the NPPA is seeking to monitor the maximum retail price (MRP) of the products covered under its jurisdiction, it may be more prudent to capture the import landed price on which GST is first paid (first point of sale) with the MRP to monitor possibly irrationally high trade margins.

He also wanted NPPA to seek ex-factory price (post discount) on which GST is charged first time (first point of sale) and the MRP to also monitor possibly irrationally high trade margins. According to Nath, it is common practice to "artificially inflate MRP to satisfy excessive margin needs of the healthcare provider or retailer which is not only harmful to consumers but also ethical manufacturers who lose out on competitiveness if they are unable to satisfy needs of their buyers."

"It's a strange marketplace since last one decade where hospital buyers are not negotiating on lower buying price but for higher labelled MRP and higher trade margins. This unethical practice needs to be regulated. Price monitoring is a start but it should not be from price to stockist by an importer, but from first point of sale when goods enter the country," he adds.

Incidentally, all medical devices are now regulated under Drugs Act though only 37 have so far been notified for compliance.

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