Govt’s decision to delink medtech from pharma to boost its growth

Industry has wholeheartedly lauded the latest developments and the government’s decision to boost domestic medical device

The Union Minister for Chemicals & Fertilizers and Parliamentary Affairs, Mr Ananth Kumar inaugurated the ‘India Pharma and Medical Device 2017’ International Conference, in Bengaluru on February 11, 2017. The Minister of State for Commerce & Industry (Independent Charge), Mrs Nirmala Sitharaman, the Minister of State for Road Transport & Highways, Shipping and Chemicals & Fertilizers, Mr Mansukh L. Mandaviya along with the Minister of Industries, Karnataka, Mr R V Deshpande, the Minister of Medical Education, Dr Sharanpraksh Rudrappa Patil, the Secretary, Department of Pharmaceuticals,Mr Jai Priye Prakash, the Secretary, Directorate of Health Research & Director General, Indian Council of Medical Research, Dr Soumya Swaminathan and the WHO Representative to India, Dr Henk Bekedam are also seen.

Bangalore: The big day for domestic medical device industry has finally arrived. In order to boost  ‘Make in India’ program and reduce import dependency, government has decided to include back medical device sector as one of the 25 flagship industry to steer the program.

This was announced by Union Minister of state for Commerce Ms Nirmala Sitharaman at the inaugural session during the National Conference “Indian Pharma and India Medical Devices-2017” here.

“Like Pharma has earned respect worldwide, I hope medical devices similarly earn this respect globally and achieve global manufacturing competitiveness. Medical devices is now being made a part of 25 Make in India focus sectors,” said Ms Sitharaman at the conference amid the presence of senior representatives from Central an State government as well as top representatives from pharma and medical device sector.

There were other good news for the sector. The Government also announced the delinking of medical device from pharma sector so that it can chart a distinct and definitive course along with distinct and facilitating regulatory framework. The same was announced by the Union Minister for Chemicals and Fertilizer, Mr Ananth Kumar here at the conference.

“Time for this sector to fly like butterfly and the pharmaceutical and medical devices to be spun off as a separate ministry of pharmaceutical and medical devices. I have recommended this to the Honorable Prime Minister and this request is under active consideration by the PM and PMO,” said Mr Kumar.

Till now, the medical device sector has been governed by the “Drugs & Cosmetics Act, 1940” which was primarily meant for regulating the pharmaceutical industry and for pharma manufacturing purpose, the nodal industry has been Ministry of Chemicals & Fertilizer. Globally, the medical device industry is completely separate from pharma sector and governed by separate set of legislations and regulatory framework than pharam. The Indian medical device industry has for a very long time been urging that this inconsistency has been one of the chief bottlenecks for the growth of the industry and hampered its development as a globally competitive on the lines of Indian pharma sector. Currently India imports over 70% of its medical device requirements and the total annual market size is estimated at over USD 10 billion.

The government has also decided to bear the cost of effluent treatment plant and provide some basic facilities free of cost at the upcoming medical device parks in states such as Andhra Pradesh, Haryana, Gujarat and Maharashtra, to make it globally competitive. This move has the potential to bring down the cost of medical device manufacturing in India by as much as 30%.

Industry has wholeheartedly lauded the latest developments and the Government’s decision to boost domestic medical device.

“We are very happy to note that the honourable ministers (Mr Kumar and Ms Sitharaman) spoke about need of affordability, availability, acceptability and also the need for viability for the manufacturers to enable growth and competitiveness,” said Mr Rajiv Nath, Forum Coordinator, AiMeD. Mr Nath was part of the special invitees to the Conference and AiMeD has been striving and advocating for years to accord medical device to bring under separate regulatory framework so that it could realize its potential while India’s humungous import dependency comes down.

AiMeD has also recommended and submitted 6-point roadmap to the government for making India a true global powerhouse for medical devices. These include:

1: Tariff Rationalisation: Basic Import Tariff to be 10% for Medical Devices (whose Export is over 5 Crores) and Duty on Components to be 5% Next Year and 7.5% thereafter as a Make in India Enabler. Concessional Duty on Raw Material may be retained at 2.5% for now, for Next 3 Years.

2: Regulations for Patient Safety: Draft Proposed Regulatory Rules to be amended for :

  1. i) Voluntary Compliance backed by 3rd Party ICMED Certification to be considered as a Compliance option.
  2. ii) Cover High Risk Devices also in 3rd Party Certification as being done for Low Risk.

3: Buy Indian Policy of Preferential Market Access and Preferential Pricing (as per World Bank Terms) for Indian Medical Device for Indian Public Healthcare Tenders

4: Consumer Protection: MRP labelling to be enforced on Unit of Sale of Medical Devices. No NPPA for Medical Devices other than case of Stents (Combination Device, having Drug). Introduce Price Cap Mechanism of 4-5 times Ex-Factory / Import Landed Price in a Phased Manner or bring in a 1% Cess on Excise / GST on MRP to act as Disincentive for putting Exorbitant MRP and to incentivise ethically correct Low MRP.

5: Ban on Refurbished Medical Equipment, for Next 5 Years till such time we have a strong Regulatory Regime to ensure validated and calibrated Equipments limited access, for enabling Patient Safety.

6: Medical Device Export Promotion & Import Substitution Council – It can be called by any Name, but to focus on these aspects, to address India’s 70% Import Dependency, 90% on Medical Electronics.