Medical device industry has urged the government to mandate MRP on imported products on the unit pack at the point of customs and also impose one per cent excise duty on the MRP. The MRP-based tax has been recommended as disincentive for a higher MRP to ensure consumer protection in India and hail domestic production in the country.

This demand comes close on the heels of medical device industry asking for an increase of 10 per cent in customs duty on imported products to help boost domestic production.

According to Rajiv Nath, forum coordinator, AIMED, “With no MRP fixed for imported medical devices in the country, they are being overpriced at the point of care to accommodate commissions shared between the hospital pharmacies, distributor or the trader. This is being done under the garb of supplying institutional hospital products where MRP for a product is a misnomer and hence the burden of the high cost is passed on to the gullible patient. This has also led to an imbalance in the industry as these imported products are outside the purview of the law as they are not being sold through retail pharmacy outlets where margins for retailers and wholesalers are fixed under the government's pricing regime.”

Industry also recommends that domestic production of medical devices can also be encouraged with a set of recommendations which includes preferential pricing access for Indian products by allowing procurement through government tenders based on L1 pricing along with 5 per cent price benefit on indigenous products to support domestic manufacturers. This would help counter the 17 per cent subsidy which China gets on its exports. This also includes mandating ISO 13485 specification as a part of procurement of indigenous products through tendering for those manufacturers who have ICMED certification.

A case in point is of MRP of imported cardiac stent which is being usually jacked up by 300 per cent to 700 per cent of the actual cost of import. This is an exploitative practice and fails to address the concept of patient care.

Inquiry by the Maharashtra Food and Drug Administration (FDA) last year revealed that patients were being forced to pay double or even triple the price for cardiac stents 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 Drug Price Control Order (DPCO-2013). Therefore, the prices of medical devices cannot be monitored and controlled as of today. Maharashtra FDA has therefore urged NPPA to bring coronary stents under the ambit of National List of Essential Medicines (NLEM) to control its prices.

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.