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“A Year of Intense Lobbying Efforts by US MNCs Failed to Sway Indian Government on Stent Pricing”: AiMed

All India Medical Devices Manufacturers’ Association (AiMed) complimented the Government for staying on course on stent pricing and not giving in to the intense lobbying by the US MNCs.

“We are happy with NPPA’s new decision to continue with their directive on price cap by not falling to the massive lobbying of overseas multi-national manufacturers. Single category on DES is scientific and continuation of the above stand gives confidence to the manufacturers”, Mr. Rajiv Nath, Forum Coordinator, AiMed said. The manufacturers could have welcomed higher pricing to accommodate inflation but guess that may be forthcoming in April review, Mr. Nath added assuring full support and cooperation from Indian manufacturers to the government, consumers and medical professionals.

A year after slashing the coronary stent price by as much as 85 percent, the National Pharmaceutical Pricing Authority (NPPA) has further reduced DES stent prices, albeit, marginally. According to the notification issued by the pricing authority, drug-eluting stents will be priced at Rs 27,890 and bare-metal stents at Rs 7,660, excluding the goods and services tax (GST), effective from 13 February 2018.

At the same time, NPPA also decided against multinational stent makers’ request for a new category for advanced stents in absence of adequate data to prove superior clinical outcomes as being claimed. The order mentions only two categories of stents, bare metal stents, and drug-eluting stents. MNC stent makers like Abbott, Boston Scientific, and Medtronic had been pushing for better prices for their next-generation stents. But the NPPA has stood firm and not entertained their request to form categories.

NPPA also released a second notification on Trade Margins of accessories used in stenting procedure, including the guide wire, balloon Catheters, cardiac guide wire etc. NPPA found that the trade Margin between Import landed Price and MRP ranged from 177% to 405% and between Price to Distributors and MRP ranged between 62% to 234% for Cardiac catheters and guide wires indicating Gross Margins by importers were ranging from 46% to 202%.

“If AiMeD’s proposed formula on Capping of Trade Margins to DoP is applied to guide-wires and catheters then for the items between Rs 1000 and Rs 1 lac, the Trade Margins between Import Landed Price / Ex-Factory Price and MRP will reduce to 66%. This will provide tremendous savings to consumers”, Rajiv Nath said.

According to the NPPA, following the price cap on coronary stents, the share of domestic stent makers has risen. Preliminary data suggests a 4 percent shift in favor of domestic manufacturers who now have 61% market share. This vindicates the stand that AiMed has been taking, namely, using price controls not only to protect consumers but also as a competitive strategy extending protection and support to domestic industry for promoting its growth and high continued sales growth is a validation of quality based competitiveness of Indian brands.

The other myths that have been busted are:

1- No Chinese Stents invasion is there as was being touted.

2- No scarcity of imported Stents as Market Inventory gone up.

3- No overall withdrawal from the market by major importers.

4- To import is still profitable as more importers have joined the club post price cap.

5- Industry is NOT negatively impacted by Price Caps.

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