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#ImplantFiles: Diagnostic Labs Buy Used Machines; No Checks by Regulator, Testing is Voluntary

The bulk of these second-hand equipment — from flexible endoscopes to MRI machines — are sold online by third-party traders, ill-equipped to provide reliable maintenance services. Nobody has kept an exact count, but it is estimated that 50-70 percent of medical equipment in use in India’s private healthcare facilities — from unregulated path labs to some of the super specialty hospital chains — are pre-owned. The bulk of these second-hand equipment — from flexible endoscopes to MRI machines — are sold online by third-party traders, ill-equipped to provide reliable maintenance services. An investigation by The Indian Express, in collaboration with the International Consortium of Investigative Journalists (ICIJ), into the big, unregulated medical bazaar has found that no regulator ever checks these pre-owned machines, before or after sale.

And that for most tests and procedures, patients have no means to verify if the equipment is hazardous, faulty or if the test results are inaccurate. The National Accreditation Board for Testing & Calibration Laboratories (NABL) is there to ensure quality but accreditation is voluntary and not even two percent of the country’s estimated 1 lakh diagnostic laboratories have opted for it. The Medical Device Rules 2017 too is silent on pre-owned machines which are 35-50 percent cheaper than new products. Niti Aayog member V K Paul accepts that a “policy gap exists” on the use of pre-owned and refurbished medical equipment. “As the BIS (Bureau of Indian Standards) sets the benchmark for 1000 medical devices, we should be able to also address the refurbished sector soon,” he said. With nobody watching, it is difficult to tell how widespread the use of pre-owned equipment is.

Dr Deepak Mishra, Director (Laboratory Sciences) at Kolkata’s Tata Medical Center, and president of Indian Association of Pathologists & Microbiologists, said: “Only 20 percent of India’s labs are in the organised sector and many of them use second-hand units. Nobody knows what the other 80 percent are using.” NABL CEO Anil Relia, underlining that only 1038 medical labs out of an estimated one lakh were accredited to NABL as of August this year, said: “Pathological and diagnostic laboratories are required to provide details of all major equipment while applying for accreditation and we verify during on-site assessment if the equipment comply with quality requirements of ISO 15189.”

Nothing is illegal

In New Kondli on the outskirts of Delhi, a narrow, dark stairway leads to the first floor of a four-storeyed residential block. There is no nameplate on the door and the woman in the flat is not very helpful: “What service center? I don’t know what you are talking about. Go check the other 15 flats in this building.” On the phone, the proprietor of the company that uses the New Kondli address for its Delhi service center is not apologetic. He runs a diagnostic center not far from Lucknow and sells pre-owned equipment such as MRI machines online. “I import these machines, use some at my lab, rent some to other local labs, and sell online. I can do the installation and basic maintenance myself. I have technicians on salary in Roorkee. This address is for customers in and around Delhi,” he said.

He declined to speak on the qualifications of his technicians. “There is no minimum requirement in law. Why single me out for interrogation? Show me one illegal thing I do in my business,” he said. Another proprietor also banked on the lack of regulations when he contacted his sources in a leading hospital chain to “pick up a few used machines” for his soon-to-be launched diagnostic center near Meerut. “I was working on a good deal, but they shifted their old machines to a branch hospital in (a district headquarters). So, I had to buy an MRI machine online,” he said. He did not mind the gamble. “I know there is no guarantee backup but my competitors in the locality have already bought second-hand machines, and I had to go online for cheaper options for better margins. I just hope there are no major service issues,” he said.

He played down the safety issue. “Just because we have not gone to NABL does not mean we don’t care about our patients. From basic to elaborate, there are different standards of safety. Would these machines be allowed if they were dangerous?” he argued. Under the Directorate General of Foreign Trade rules, import of second-hand machinery and used capital goods need a valuation certificate from a chartered engineer — primarily to determine duty fees. To safeguard against radiation, equipment such as X-ray and CT scan machines need clearance from the Atomic Energy Regulatory Board. Any other medical equipment — new or pre-owned — can be imported and sold in India without any safety check.

Regulate and how

There are two types of pre-owned equipment — those restored to original safety and effectiveness by Original Equipment Manufacturers (OEM) as well as Certified Refurbishing Companies (CRC), and those sourced and sold as-is by third-party traders. In the developed market, the OEM and CRC industry has taken off in the last decade. In the developing world, third-party vendors, with little or no technical expertise initiated the trade in pre-owned medical equipment, and by 2002, several countries banned such imports due to poor after-sale services and non-availability of spare parts. In the last decade though, shrinking healthcare budgets and better technologies have led to increasing use of second-hand equipment even in the developed countries. Most equipment come with a buy-back promise. As bigger hospitals purchase the latest models, their used units often remain suitable for certain applications. Big brands started selling these units after recalibration.

However, third-party traders of varying credibility and expertise continue to operate in the market. The World Health Organisation feels it is important for developing countries to ensure that companies supplying refurbished equipment fulfil after-sale obligations including the continued availability of technical support and maintenance services. But, according to Medical Technology Association of India (MTaI) dominated by the MNCs, an estimated 95 percent of pre-owned equipment imported to India belong to the CRC or refurbished category. MTaI representatives, who did not wish to be named, reiterated the Association’s stand that import of only OEM products should be allowed. “Given the rising cost of healthcare, the price benefit of refurbished products plus the safety and service guarantees make them a rational choice, particularly in Tier 2 and Tier 3 cities,” a MTaI member said.

But the proprietor of a third-party trading company had a counter view: “The MNCs want to weed out small players like us, take over the second-hand market and control price. Calibration and servicing need skilled manpower which is nobody’s monopoly. Yes, unaccountable online traders are a nuisance. But why target bona fide companies like ours? Let’s have strong regulations and let all who can comply compete equally.” The Association of Indian Medical Device Manufacturers (AiMeD) dominated by domestic companies, is also sceptical of MTaI’s stand. Rajiv Nath, Forum Coordinator, AiMeD, said: “There is no mechanism to verify if even the OEM products are properly calibrated as claimed. Until we have robust regulations in place to ensure patient safety, we should stop importing all pre-owned equipment.”

According to Nath, the price benefit of using second-hand machines is rarely passed on to the patients while risks remain very real. No reseller, including global OEMs, has any obligation to conduct post-marketing surveys. There is just no record of adverse incidents specific to pre-owned equipment. “The regulatory regime has to be practical to be effective. Since it is virtually impossible for a regulator to monitor every pre-owned machine, the emphasis should be on training and capacity-building so that a certain service quality can be maintained,” said M Balasubramaniam, an industry expert. Until then, the patient’s only option is to trust the healthcare facility and hope that its integrity matches its reputation. – Indian Express