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Regulating Prices of Medical Stents: Necessary for Affordable Health Care for the Economically Deprived

By Saptarshi Das · On March 16, 2016

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The Indian medical devices sector is worth approximately USD 3 Billion and is growing at a Compound Annual Growth Rate of 15%. The medical devices market in India is dominated by imported products, including products manufactured using imported material, which comprises approximately 75% of the total sales. The domestic companies are largely involved in manufacturing low-end products for local and international consumption. The regulatory framework in India applicable to medical devices is still inadequate.

In the last five years, the coronary stent market in India has been growing at an impressive rate due to rise in coronary angioplasties which have resulted from a surge in cardiovascular diseases. A stent is a metal mesh device inserted to strengthen weak blood vessels blocking the blood flow. Stents entered the Indian market during the 1990s in the form of Bare Metal Stents (BMS) which proved to be among the most useful and beneficial devices for patient of coronary artery blockage undergoing angioplasty at that time. A BMS is a mesh-like tube of thin wire made of stainless steel or cobalt chromium alloy without any drug coating. It solved the main problem of acute closure markedly and also the recurrence of abnormal narrowing after corrective surgery (restenosis) to a certain extent, which resulted in the percentage of closure coming down from 30-40% to around 15-20%. Subsequently, the Drug-Eluting Stents (DES), designed to inhibit growth of new tissue, which became available in 2005-06, addressed the problem of restenosis successfully with the percentage of closure coming down sharply from 40% to less than 10%.

India today lacks a regulatory regime for administering stent prices.  With the passing of the Drug and Cosmetic (Amendment) Bill, 2014, medical devices have been brought under the regulation of the Drug and Cosmetic Act, but its prices cannot be regulated under the Act, unless it is a scheduled drug under National List of Essential Medicines. At present, Intra-Uterine Device is the only device to be included under the National List of Essential Medicines, price of which is determined by the National Pharmaceutical Pricing Authority (NPPA). Although the NPPA has not fixed the Ceiling Price of Stents as it is a nonscheduled drug, but its price movement has to be monitored by NPPA on the basis of the price list submitted by manufacturers, including importers. In order to arrive at a reasonable benchmark price for BMS and DES, NPPA requested the National Health Systems Resource Centre (NHSRC), a technical support institution under Ministry of Health & Family Welfare, the Division of Healthcare Technology to undertake an assessment of clinical effectiveness and cost effectiveness of BMS and DES from affordability angle.

The Report of the NHSRC shows that in the absence of stent price regulation in the country, there is a huge exploitation of the consumer due to extreme overpricing stents sold in the country, especially imported brands, making it out of reach for majority of the people suffering from cardiovascular diseases, and also impoverishing those who cannot afford it but are compelled to incur high medical expenditure for the treatment purposes. It is seen that bulk of stents consumed in the country are imported, and the maximum retail price (MRP) in many cases is ten times the landed cost, the bulk of which is accounted for by distributor/ hospital margins and promotional expenses.

The patients are forced to pay anything between 60,000 to 1,00,000 rupees for cardiac drug eluting stents. A study conducted by the Maharashtra drug regulator over six months has revealed that patients paid four to eight times the actual cost of import (25,000 – 40,000 rupees) of the heart stent, depending on its brand and type. The Maharashtra Food and Drug Authority  report cites the example of DES manufactured by a Dutch firm. These stents were imported by Abbotts Healthcare Pvt. Ltd at 40,710 rupees and sold to the distributor Sinocare at Rs 73,440 against a marked MRP of 1.5 lakh rupees. A Times of India article reported that the  extra money that the distributors get are later used to bribe doctors so that the hospitals only use their companies’ devices in the future.

The National Interventional Council (NIC) of the Cardiological Society of India has reported a surge in use of stents in the last decade. Facts provided by the NIC, proves that there is a growing demand for cardiac interventions, especially in terms of stent implants. One can’t stop but raise the question whether stents are being overused for profit motives in relation to cardiovascular diseases.

Talking of the global scenario, in the United States of America, where in the last ten years, several studies show that there is a constant misuse and overuse of stents. Episodes similar to that of USA are found in India as well.

With no standard regulations for administering stent prices, misuse or overuse is common in India.  Dr. Ramakant Panda, MD, Asian Heart Institute mentions  in an Indian Express article, “At my hospital I get around 30 % patients who have been advised stent implants or bypass procedures by their doctors and who actually do not require these surgeries. I treat them with just medication.”

There have been contrary claims as well. NIC registry data also reflected a trend contrary to the claims of overuse, with the rate of growth of angioplasties going down from 22 % in 2013 to 14 % in 2014. The reduction of growth rate in procedure points towards reducing treatment adoption of angioplasty. These data points may not suggest an overuse.

The issue of capping stent prices, and to make it available to the patients at a uniform price has been under consideration by the health ministry for some time. Moving ahead in the direction, the government will soon arrive at a decision to cap prices of coronary or cardiac stents. The maximum retail price (MRP) of bare metal stents is expected to be around 20,000 rupees, and that of the drug-eluting stents is likely to be fixed at 28,000 rupees.

The new draft National Medical Device Policy-2015, issued recently by the Department of Pharmaceuticals (DoP) mandates a separate price control for medical devices. As per the new draft policy, the medical devices will be included as separate entry in the list of commodities controlled under the Essential Commodities Act.  The government will announce a separate policy enunciating the principles for regulating the prices of identified medical devices and implement the same by notifying a separate Medical Devices Prices Control Order (MDPCO). Under the new draft policy, a separate division will be created in National Pharmaceuticals Pricing Authority (NPPA) for pricing of the devices by suitably amending the resolution constituting NPPA. The policy recommends formation of an autonomous National Medical Device Authority (NDMA). The NDMA would be tasked with promoting the local device sector, enforcing stricter safety standards, and installing price controls for devices, including surgical instruments, implants, and diagnostic equipment, the creation of an independent regulatory body could stem alleged overcharging for imported devices. The authorities could also announce a new medical devices control order that is separate from the Drug Prices Control Order, which presently covers both medical devices and pharmaceuticals.

The Policy also mandates promotion of medical device industry to make the country a global hub of production and innovation in medical devices. The present Government has also announced plans to put up the country’s first industrial parks, in Gujarat and Chengalpattu, dedicated to medical device manufacturing. The Central Drug Standard Control Organisation (CDSCO),  India’s equivalent of the U.S. Food and Drug Administration (FDA) unveiled a safety and surveillance program for medical devices, stricter accreditation standards for clinical trials, and enforcement of better quality control practices in local manufacturing.

The government’s move in the direction of price regulation of stents is certainly welcome. It is to be seen whether the pharmaceutical manufacturers can swallow it without any objection.

Approximately 60% of the stent market is shared by multinational companies such as Abbott, Medtronics, Meril Life sciences, Boston Scientific etc. They attribute the high final cost of stents to research and development. The consequent price cap could stop the introduction of technologically advanced stents in India. Such government price control may  dis-incentivize companies and they may stop investing in the product, denying advanced technologies for patients. Though standard Indian stent brands are far more economical compared to popular imported brands, the demand for them is very low, which may be attributed to aggressive promotional practices of big companies, which does not enable the patient to make an informed decision. Besides imported stents become an obvious choice because these FDA-approved stents have gone through several clinical trials unlike their domestic counterparts.

Some have criticized the government’s proposal stating that nowhere in the world are stents treated as essential medicines and any medicine is be added to the essential list only in case of national medical emergency. Moreover the Government if, bent upon controlling prices of medical devices, must make an attempt to lower cost of treatment. Even if equipment prices are capped, if cost of treatment increases, it would continue affecting poor patients.

Amidst the hubbub of the government’s drive to enthuse domestic development of medical devices, one must remember the late former president Kalam’s immense contribution to the field of innovative medical devices (thus, his contribution to science wasn’t confined to the defence domain as some point out). The missile man’s two medical innovations, heart stents and lightweight callipers, which was a boon to poor patients due to their cost effectiveness, should revived and promoted under the Union government’s “Make in India” programme.

Former president Dr. APJ Abdul Kalam was keen on popularising the stents in government hospitals. The hospitals remained flooded with costly stents, some of which were made in India whereas many were imported from other countries. The stents, along with the special callipers which he designed, have almost disappeared from hospital shelves, thus denying the poor and underprivileged the benefit of cost effective devices. Even the lightweight callipers developed by Kalam for polio patients have been edged out of the market by commercial manufacturers with strong marketing strategies. One can only hope that the present government takes forward Kalam’s legacy and encourage production of low-cost stents in the domestic market. That might make “Make in India” a true success.

While the Modi sarkar had been rightly critiqued for slashing the health budget, a new initiative of lowering the prices of certain medicines by 40% has been introduced, which is a step in the right direction. Likewise, the AAP model of mohalla clinics in Delhi has won international acclaim. There is indeed some remarkable work being done for ensuring access to health care for the poor by private individuals in our country too, as you can see here, for example. Humanitarian compassion for the poor is a part of the empathy that ought to define us as humans; else, all other talk of developing India is both morally and practically just meaningless. Nationalist concern has to be as much about issues like these as about warding off military threats. And yes, concern for suffering humans should even cross national boundaries.

(Image Courtesy: Flickr)

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Saptarshi Das

Saptarshi Das

Hailing from Kolkata, Saptarshi Das is studying law at Gujarat National Law University (GNLU), Ahmedabad. He has a keen interest in political affairs, literature and motion pictures.

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