The prices of coronary stents are set to increase by 4.2 per cent from April 1 with the National Pharmaceutical Pricing Authority (NPPA) revising them in line with the Wholesale Price Index (WPI) for the year 2018 over 2017. This continues the calibration efforts of the price watch dog which started in 2017, when it cut prices of stents by as much as 85 per cent in some cases. While prices of stents ranged from Rs 25000 per unit sold to a couple of lakhs per unit in some of the more advanced stents, the 2017 price cap reduced prices between Rs 2500 to Rs 31,000.
After more interventions last year in February and April, the latest order notification dated March 29, states that the ceiling price of bare metal stents (BMS) will now be Rs 8,261 while the price cap on drug eluting stents (DES) including metallic DES and bioresorbable vascular scaffold (BVS)/biodegradable stents will be Rs 30,080. These prices are exclusive of Goods and Services Tax (GST) where applicable.
The order also allows manufacturers/importers of coronary stents with MRPs lower than these ceiling prices (plus GST as applicable, if any) to increase the existing MRP to this price cap. While this order offers some respite to stent manufacturers, the industry would probably argue that these prices are still not viable and sustainable enough to encourage investments in further innovation and research. There was also a demand that the government introduce more price slabs and differentiate stents based on the technologies used. The government has so far refrained from this step.
The government’s focus on reducing the trade margins between manufacturers, distributors and hospitals is no doubt laudable. But, the medical device segment is still smarting at being regulated along with drugs under the Drugs and Cosmetic Act, the Drugs (Prices Control) Order, 2013 read along with the Essential Commodities Act, 1955. While manufacturers concede that regulations are necessary to provide checks and balances and provide a road map for the development of any sector, they argue that a one-size-fits-all approach is severely flawed.
With the Medical Device Rules 2017, the Central Drugs Standard Control Organization (CDSCO) has taken a huge step towards addressing the specific requirements of medical devices. Our cover story in the April issue, titled Regulating devices as drugs: The debate continues, analyses different view points of this contentious issue.
But this is just the first step. Industry associations are urging regulators to further fine tune the Medical Device Rules 2017, as it needs separate provisions to address the requirement of high-end medical devices with regards to maintenance, testing, stock, post release changes, import of parts post-sales, etc. Medical device associations also point out that there is an urgent need for more approved test houses to support during design development.
Hopefully, regulators are listening and will address these issues in consultation with industry. The bottom line is that there is no doubt that patients have benefited from these price monitoring initiatives, thanks to increased access. The fact that NPPA has announced this latest revision is a sign that the regulator will consider reasonable increases in line with inflation.
But, will increased access due to moderating of prices, lead to indiscriminate use of medical devices, even when not required? Thus, on the government’s side, regulators must keep in mind that the cost of medicines and medical devices is only a part of the overall cost of the procedure, or for that matter, medical treatment of any nature. Continuous monitoring to plug leakages and frauds will be crucial to see true long-term benefit of these policy changes.
There are some early signs that the government seems to be serious about cracking down and preventing the loss of resources. At least when it comes to its flagship healthcare scheme. For e.g, the National Health Authority, the implementing arm of Ayushman Bharat, has suspended the licenses of two hospitals in Jharkhand (Nagarmal Modi Seva Sadan in Ranchi and PVTG Hospital in Ramgarh) when audits showed that the hospitals had admitted more patients than the number of beds and also charged money for diagnostics from beneficiaries. Hopefully, monitoring of the scheme will get more stringent rather than slacken as more hospitals get impaneled and beneficiaries increase. With elections around the corner, let us hope poll promises will translate into intelligent policies after the heat and dust has settled. As always, regulation is both intention as well as implementation. The former remains an empty promise if the latter cannot keep up with the pace of growth of the industry.