We support govt's move to regulate trade margins: MNC devices lobby

Medical Technology Association of India (MTaI) — the multinational medical devices lobby group — on Friday said it supports any government move to regulate trade margins but is against capping of maximum retail prices based on cost-based pricing.

MTaI called for a more “nuanced approach” to regulation of medical devices taking into account the costs incurred on “services and support required for the devices”.

The MNC trade body said it’s not joining the lobby group of domestic syringes and needle manufacturers that have decided to voluntarily reduce the maximum retail prices of these products

“Self-regulation based on decision of a small group is not sustainable,” said MTaI in its statement.

“We have seen out of 26 manufacturers of Syringes and Needles only 12 companies gave “what-s-App” confirmation with already one member dissenting and others non confirming, clearly illustrates that self-regulation will not sustain,” the statement added.

The All India Syringes and Needles Manufacturers Association (AISNMA) on Thursday asked members to consider printing reduced MRP from December 24 and implement it by latest 26 January. The AISNMA said it reduce MRP prices as per trade margin cap at 75 percent. After the AISNMA move the prices are expected to come down by 50 percent.

The country’s drug price watchdog - the National Pharmaceutical Pricing Authority (NPPA) asked companies early this week to self-regulate prices – amid rising speculation and debate over whether prices of more medical devices will and should be controlled by the government.

Last week, India's drug pricing regulator released information showing Gurugram-based Fortis hospital bought medicines and consumables at rates much lower than what it billed the family of a seven-year-old dengue patient for them. This includes syringes, which were marked up between 600 percent -1,200 percent, and needles, which were billed at 150-260 percent the price the hospital had procured it for.

Another hospital, Max Super Specialty in Patparganj, was found to be taking margins of up to 527 percent.

Because of the misalignment of business interests with patient welfare, regulation in healthcare exists as the norm rather than exception around the world. The Government has a constitutional obligation to protect people from the exploitation of third parties and therefore needs to intervene to ensure affordability of medical devices.

The All India Drug Action Network (AIDAN) – the patient advocacy group welcoming the announcement of AISNMA, however said self-regulation has never been an “effective solution” and asked NPPA to impose price caps.

“Self-regulation does not guarantee compliance and cannot be enforced,” said AIDAN in its statement.

“Regulation is essential for enforcement and also works in favor of the long-term health of the domestic industry by ensuring a level-playing field is maintained across manufacturers,” AIDAN added.

AIDAN sought NPPA to publish data on the trade margins involved in medical devices notified as ‘drugs’ under the Drugs and Cosmetics Act and Rules falling in 19 categories that remain outside the purview of price regulation, and act without further delay to impose price caps as the only appropriate and sustainable measure to ensure affordability of these critical devices.