While India is the world's third-largest pharmaceutical market, its share of the medical devices market is way behind. More than 70 per cent of medical equipment sold in the country is imported, mostly from the United States.
India’s overall medtech industry could generate as much as $50 billion in annual sales over the next decade, an increase of nearly 800 percent from the current annual estimate of $6.3 billion, according to the Confederation of Indian Industry (CII).
The government has taken some steps this year to realize the huge potential of this industry.In January, it allowed 100 per cent foreign direct investment into the sector. In April, it announced plans to put up the country’s first industrial parks, in Gujarat and Chengalpattu, dedicated to medical device manufacturing. In May, the Central Drug Standard Control Organization (CDSCO) unveiled a safety and surveillance program for medical devices, stricter accreditation standards for clinical trials, and enforcement of better quality control practices in local manufacturing.
To further streamline the regulations of the industry ,India plans to set up a regulator to oversee the country's medical device industry, according to a draft policy released this month. This is the country's first effort to regulate an industry that covers everything from thermometers to prostheses.
By reducing the dependence on imports and setting up a strong base for medical devices especially those having critical implications in terms of affordability and availability for patients, the Department of Pharmaceuticals (DoP) has issued the draft National Medical Device Policy-2015, for strengthening the 'Make in India' drive in medical device sector.
As per the draft policy, an autonomous body 'National Medical Device Authority' (NMDA) will be created which will provide a single window mechanism to the industry with an objective of promotion of the medical device industry to make the country not only self reliant but also a global hub of production and innovation in medical devices. The Authority will be responsible for setting up and managing, through appropriate corporate body/SPV, Medical Devices Mega Parks of approximately 500 hectares and above, of various specializations in the vicinity of Centres of Excellence.
The NMDA will create benchmarks as per international best practices and update all the stakeholders on global development, besides developing knowledge networks with partners from industry.
It will identify and prevent creation of unnecessary and unjustified technical barriers to trade especially by new or changing technical regulations; support and prepare indigenous businesses to face competition, access foreign markets, and find new business partners abroad; search, collect, collate and analyze relevant data; and promote, co-ordinate and issue guidelines for the development of risk assessment methodologies and monitor, conduct and forward messages on the risks associated with medical devices to the central government, state governments and other enforcement agencies.
As per the draft policy, incentives will be given to both greenfield and brownfield units such as preference in government procurement for medical devices which are being manufactured in India with an additional preference for medical devices manufactured under MSME sector; R&D by agencies like ICMR, DBT, CSIR, DIETY & DoP should be supported/ coordinated through the single window facilitating body; low cost funding like interest subsidy to MSME and concessional power tariff for up to 5-10 years.
Other incentives include seed capital, viability gap funding and co-fund start-up projects; support for commercialization of innovations; provide longer term view (10 years window) for 200 per cent weighted tax deduction on approved expenditure on R&D as the gestation period in high is this industry; tax/ duty structure to be designed to promote local manufacturing of quality medical devices and diagnostic equipment; and minimum/ zero duty on the import of raw materials and manufacturing equipments for production of medical devices.
Institutional frameworks
The draft National Medical Device Policy has mandated several institutional frameworks such as common medical device testing centres, Centres of Excellence, Made in India marking (BIS) specific to Medical devices and a Skill Development Committee under National Medical Devices Authority.
As per the policy, common medical device testing facilities, preferably in the PPP mode, should be set up by government in major medical device manufacturing hubs to facilitate testing/ evaluation of medical devices. Recurring expense can be borne by the industry.
The policy further mandates to designate 'Centres of Excellence' (CoE) for supporting product development and validation which are having existing requisite facilities and expertise for different categories of medical devices (Example: Department of Electronics and Information Technology (DETPI), Bureau of Indian Standards (BIS), Indian Institute of Technology, Madras (IlT-M), Indian Institute of Technology, Delhi (IIT-D), Indian Institute of Science, Bangalore (IISc-B), Central Institute of Plastics Engineering (CIPET), and Defence Research and Development Organization (DRDO).
These Centres of Excellence would support product development, design and prototyping; validation and certification of the medical use of devices; and adopt, implement and advocate policies on efficacy and safety testing.
The policy also mandates to strengthen a Made in India marking (BIS) specific to Medical devices in line with international standards like CE and FDA.