In the wake of reports about cardiac stents being sold at inflated prices by trading companies through a growing nexus of distributors and hospitals, Maharashtra Food and Drug Administration (FDA) urged the National Pharmaceutical Pricing Authority (NPPA) to bring cardiac stents under National List of Essential Medicines (NLEM).
Since cardiac stents are considered as life saving drugs, a fixed profit margin on cardiac stents also need to be stipulated for importers, distributors and hospitals to make it affordable in the larger patient interest, recommended Commissioner FDA Dr Harshadeep Kamble to NPPA.
To which a senior FDA official further added, "Overpricing of stents can be prevented if the drug pricing regulator draws out a policy to fix the prices so that any violation in terms of evading the law related to ceiling price of stents can be treated as an 'offence'."
An inquiry by the FDA revealed 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.
Medical devices including cardiac stents and 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.
The recommendation comes in the wake of studies conducted by the FDA which has revealed that manufacturers in connivance with importers, distributors and hospitals are fixing the MRP of cardiac stents arbitrarily which is then passed on to the patients. It was 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.
The MRP of a drug eluting stent 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 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 in one such 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.
Alarmed by unusual spikes in prices of cardiac stents and drug-eluting stents, NPPA had also sought pricing data from manufacturers, importers and distributors of these devices.