Policy Matter

NPPA to bring cardiac stents under price control soon

The drug pricing regulator National Pharmaceutical Pricing Authority may soon bring cardiac stents under the Drug Price Control Order (DPCO)- 2013 to curb excessive profiteering in this medical device and to make it affordable to the patients, it is learnt.

Based on the recommendations of Maharashtra Food and Drug Administration (FDA), the NPPA has agreed in principle to bring it under DPCO, according to an official associated with the NPPAdevelopment. 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 in the DPCO. Therefore, the prices of medical devices cannot be monitored and controlled as of today.

Maharashtra FDA had also urged the National Pharmaceutical Pricing Authority (NPPA) to bring cardiac stents under National List of Essential Medicines (NLEM) in the wake of reports about cardiac stents being sold at inflated prices by trading companies through a growing nexus of distributors and hospitals. Since cardiac stents are considered as life saving drugs, a fixed profit margin on cardiac stents also need to be stipulated for importers, distributors and hospitals to make it affordable in the larger patient interest, recommended commissioner FDA Dr Harshadeep Kamble to the NPPA.

A senior FDA official further explains, “Overpricing of stents can be prevented if the drug pricing regulator frames a policy to fix the prices so that any violation in terms of evading the law related to ceiling price of stents can be treated as an offence.”

An inquiry a few months ago by the Maharashtra FDA had also 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 cardiac stents, with the MRP being fixed high enough to accommodate commissions since there is no limit on what the MRP can be.

The recommendation to bring it under the purview of DPCO-2013 comes in the wake of revelations that manufacturers in connivance with importers, distributors and hospitals are fixing the MRP of cardiac stents arbitrarily which is then passed on to the patients. It was observed from the studies that the maximum retail price (MRP) of the imported DES is exorbitantly high and patients have no option to bargain.

The MRP of a DES is decided by the importing company. As many of these devices are imported, it is difficult to arrive at the actual manufacturing costs and the margins charged. Besides this, 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 from such sales to the state government are made only within 51 days by the distributors.

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