Expressing strong displeasure over the department of pharmaceuticals (DoP) proposal to regulate prices of medical devices under DPCO, the industry vehemently opposed this move stressing that such actions were leading to unfavorable business environment for the players. The industry fears that if this proposal goes by the consumers will be the biggest losers as it will lead to rise in the MRP of medical devices through arbitrary methods.
This reaction comes in the wake of recent representation sent by the department of pharmaceuticals to health ministry proposing to consider inclusion of medical devices other than those notified as drugs also under the Drug Price Control Order (DPCO). If approved, the health ministry will be asked to prepare a national list of essential devices which will be then enforced by the National Pharmaceutical Pricing Authority (NPPA).
It is understood that some medical devices including drug eluting stents, orthopaedic implants, disposable syringes, ocular lens and heart valves though notified as drugs under the Drugs and Cosmetics Act, 1940 are not included under the Drug Price Control Order (DPCO). Their prices are neither monitored nor controlled, thus invoking this move.
Stressing about this move Rajiv Nath national coordinator of AIMED said that they are opposed to this move, which has been regressive for pharmaceutical industry. “We need to use existing tax based disincentive system which works well to keep pricing controlled and ensure transparency in the labeling of other consumer goods. Keeping the best interest of the consumers let the department of revenue alone be allowed to use existing tax based disincentive systems on medical devices. Rather than bringing medical devices under DPCO and NPPA, the government should consider introducing tax innovation structure of stalling artificial inflation of MRP in medical devices.”
He suggested that this can be done by imposing a 2 per cent CVD on MRP based criteria with abatement of at least 50 per cent in case 1 per cent excise duty on MRP is not possible to disincentive importers from passing on withdrawal of concessional duty on some devices to the consumers.
This will not only safeguard consumers from exploitation, but also make Indian medical devices including diagnostics competitive. This will penalise manufacturers and importers who label their devices with unreasonably high MRP and reward those who put low MRP on their products, Nath added.