The Maharashtra Food and Drug Administration (FDA) has recommended to the Drug Controller General of India (DCGI) and National Pharmaceutical Pricing Authority (NPPA) to bring five categories of medical devices like Neuro Coils, Cochlear Implants, Cardiac Stents, Ortho Implants and Bone Cement under the Drug Price Control Order (DPCO) 2013 to make it affordable to the patients.
The state FDA has recommended the same based on the studies carried out in the past several years and is awaiting a response on the same. Medical devices including drug eluting stents (DES) are notified as drugs under the Drugs and Cosmetics Act, 1940 but is not included under the DPCO. Therefore, the prices of medical devices cannot be monitored and controlled as of today.
Studies conducted by the FDA have revealed that manufacturers in connivance with importers, distributors and hospitals are fixing the MRP of medical devices like drug eluting stent arbitrarily which is then passed on to the gullible patients. It was also observed from the studies that the maximum retail price (MRP) of the imported drug eluting stents is exorbitantly high and patients have no option to bargain. FDA, therefore, recommended that in order to monitor and control the prices of medical device, the term medical device should be included under the new DPCO regime.
The MRP of a DES is fixed by the importing company. As the manufacturers of these devices are located overseas, it is difficult to study the manufacturing cost and export prices of these devices. Besides this, the startling fact is that the cost of a medical device like DES is immediately recovered from the patients but payments to the distributors are made after a period of 60 to 120 days. The payments of applicable taxes of the concerned sale transactions, to the state government are made only within 51 days by the distributors.
The study showed that DES manufactured by an MNC and imported by an Indian importer at Thane at Rs.30,848 having MRP of Rs.1,62,000 was sold to a distributor based in Mumbai at a price of Rs.67,000. The distributor further sold this DES to a leading Mumbai based hospital at a price of Rs.1,06,050 which was then sold to the patient at Rs.1,06,050.
In yet another case of profiteering, DES imported at a price of Rs.40,710 and having MRP of Rs.1,50,000 was sold to a Mumbai based distributor at a price of Rs.73, 440. The said distributor sold this stent to a leading private hospital at a price of Rs.1,13,400 and the patient ended up paying a price of Rs.1,19,070.
It was observed that patients were being forced to pay double or even triple the price for medical devices at hospitals. As most of these are not available in the open market, patients can't check prices and are held hostage by the hospitals, which force them to buy at the price they quote. However, experts opine that having an MRP has not prevented profiteering in medicines, with the MRP being fixed high enough to accommodate commissions since there is no limit on what the MRP can be.
Moreover, while MRP is mandatory on everything manufactured in India, many devices are imported and escape this stipulation. In most hospitals, if two devices are more or less equal, the choice of which one is used depends on which fetches the hospital a bigger cut.