Lok Sabha Question No. 446 (STARRED), answered on 2018-03-27
Subject: Medical Device Industry
Ministry: CHEMICALS AND FERTILIZERS
Asked by: RAM CHARITRA

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS & FERTILIZERS DEPARTMENT OF PHARMACEUTICALS

LOK SABHA STARRED QUESTION NO. *446 TO BE ANSWERED ON 27 th  March, 2018

## Medical Device Industry

- *446. SHRI RAM CHARITRA NISHAD:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether the medical device industry has demanded that it be regulated by the Government as self regulation does not work;
- (b) if so, the details thereof;
- (c) whether it is true that hospitals were effectively forcing the manufacturers to mark extremely high MRPs to boost their profit margins and if so, the details thereof;
- (d) whether the domestic medical device industry has been urging for a cap on trade margins for more than a year; and
- (e) if so, the details thereof;

## ANSWER

## MINISTER   IN   THE   MINISTRY   OF   CHEMICALS   &   FERTILIZERS AND PARLIAMENTARY AFFAIRS (SHRI ANANTH KUMAR)

- (a) to (e):  A statement is laid on the Table of the House.

## Statement  referred  to  in  reply  to  LOK  SABHA  STARRED  QUESTION No. 446 to be answered on the 27 TH  MARCH, 2018 regarding Medical Device Industry

(a) & (b): No specific demand from medical device industry for regulation by the  Government  for  failure  of  self-regulation  has  been  received.  However, Medical Technology Association of India (MTAI), one of the medical device industry  representative  bodies,  made  a  proposal  to  the  Government  in August,  2017  that  the  total  trade  margins  for  medical  devices  should  not exceed 35%-50% of MRP excluding taxes.

(c):  There  is  no  information/report  of  hospitals  forcing  manufacturers  to mark  high  MRPs.  However,  based  on  complaints  and  media  reports  on overpricing  and  inflated  bills  to  the  patients  by  some  hospitals,  National Pharmaceutical Pricing Authority (NPPA) had asked for details of billing from the  hospitals  under  the  provisions  of  Drugs  (Prices  Control)  Order,  2013 (DPCO,  2013).  Based  on  the  data  submitted  by  the  hospitals,  NPPA  has found that the highest margin (difference of amount  billed for the formulation  by  the  hospitals  and  the  price  at  which  they  were  procured expressed  in  percentage  terms)  available  to  the  hospitals  on  scheduled medicines, non-scheduled medicines, consumables and non-scheduled medical  devices  were  357%,  1192%,  1737%  and  1271%  respectively. NPPA's  report  prepared  on  the  basis  of  information  submitted  by  these hospitals  is  available  under  the  'What's  New'  link  of  website  of  NPPA. (www.nppaindia.nic.in).

(d)  &  (e):  In  various  interactions  with  the  Government,  medical  device industry associations have not, in general, opposed the proposal of capping of  trade  margins  on  medical  devices.  To  make  notified  medical  devices affordable and accessible, Government has various options including that of fixing  trade  margins.  Monitoring  the  prices  of  essential  medicines  and devices is an ongoing process and Government, in extraordinary circumstances  such  as  market  failure  or  excessive  profiteering  can  fix  the ceiling prices of any formulation or notified medical device, in public interest.

XXXX