In a major fillip to medical devices industry, the Indian government has decided to set up a National Medical Devices Promotion Council under the Department of Industrial Policy and Promotion (DIPP) to boost domestic manufacturing and exports. The Council will be headed by secretary, DIPP of the Ministry of Commerce and Industry. Apart from the concerned departments of the Central government, the Council will also have representatives from the healthcare industry and quality control institutions. Andhra Pradesh MedTech Zone, Visakhapatnam, will provide technical support to the Council. The council will be tasked to promote and facilitate exports of medical devices, act as a platform for networking and garner views on industrial and trade policies and practices, provide technical assistance to various departments to simplify the approval process and drive a dynamic Preferential Market Access (PMA) policy while discouraging unfair trade practices in imports.
The medical devices industry in India is currently valued at USD 5.2 billion and growing at 15.8 percent annually. India is among the top 20 global medical devices market and is poised to grow to USD 50 billion by 2025 led by a growing middle class, health insurance penetration and expansion of hospitals, leading to greater need for sophisticated medical devices and better healthcare. However, the medical devices market is dominated by imported products, which comprise about 80 percent of the market. While there are around 800 medical device manufacturers in India, only 10 percent of them have a turnover in excess of Rs 50 crore, most of them are involved in manufacturing low-end products such as consumables and disposables, very few manufacture and export high-value implants and equipment. It’s reverse in China, where local companies contribute around 70-80 percent, and even multinational companies have made the country as their manufacturing hub. “We are glad government is taking serious steps to make India a global hub for medical devices manufacturing,” said Rajiv Nath, Forum Coordinator of Association of Indian Medical Device Industry (AiMeD), the body representing domestic medical device makers. AiMeD will be representing the domestic industry as a member of the Council.
Will pharma success rub on med devices?
Nath pointed out to the success of a similar body called the Pharmaceutical Export Promotion Council of India (Pharmexcil) in promoting the Indian pharmaceutical industry. Pharmexcil set up by the government in May 2004, has helped Indian pharmaceutical exports multiple folds. Indian pharmaceutical exports stood at Rs 17,857 crore in FY05 has now jumped to USD 17.3 billion in FY18. “We are hopeful that Medical Devices Development Council will similarly help realize our vision for India to be among the top 5 medical devices manufacturing hubs worldwide as the Council will spearhead the policy needs to accelerate the manufacturing of medical devices in India,” Nath said. To boost indigenous manufacturing and curb imports, AiMeD has been asking the government to keep import duties in the range 15 to 20 percent, impose trade margin cap of 75 percent on landing price and make Bureau of Indian Standards (BIS), CDSCO as sufficient requirements for public procurement. GSK Velu, Chairman and Managing Director of Trivitron Healthcare, one of India’s largest medical device maker said there is no support for local medical device manufacturers in the public procurement like in countries such as China, Russia and Turkey. “We don’t have preferential access in the public procurement, in addition, the tender documents in India have conditions like USFDA, CE accreditation requirements designed to benefit multinational companies,” Velu said.
MNCs to resist the demand for preferential treatment
But a top executive of an MNC medical device maker while welcoming Indian government efforts to boost local manufacturing and exports, raised concerns over protectionist measures proposed by the domestic manufacturers such as high import duties, price controls, preferential access, and relaxing regulatory standards. “Those measures if implemented will increase the cost of healthcare, disrupt supplies and deny patients access to life-saving technologies,” the executive said. “The government should focus on building an ecosystem for research and development and work on policies to attract investments into the sector,” he added. The US government has been critical about imposing price controls on medical devices such as cardiac stents and knee implants, that hurt US companies. The US government early this year said it is reviewing India’s status as a recipient of the US’s Generalized System of Preferences (GSP). The GSP is the US’s trade preference program designed to promote economic development for developing countries. It allows duty-free entry for some imports from certain developing countries into the US. India has found itself under review for its GSP status, owing to petitions by AdvaMed, a medical device industry body. – Money Control