Monday, March 18, 2019

Medical devices industry should comply with labeling requirement

The ministry of consumer affair and ministry of finance should ensure compliance of the rules related to labeling requirement in cases of medical devices. The government should also implement printing of maximum retail price on each unit pack of medical devices at the time of import by deputing a port officer for checking each shipment of medical devices. This is already followed by DCGI for the pharmaceuticals whereby the port officer/ADC Port issues the clearance for each shipment of pharmaceutical products to the Customs Officer as per the Drugs & Cosmetics (D&C) Act.

Department of Consumer Affairs through a notification dated June 23, 2017 had made it mandatory for all medical devices including those notified as drugs to have MRP on unit pack and if sold by a hospital to patient then they can’t claim the status of institutional customer. Additionally, country of origin is now mandated to be labeled on the unit pack.

What is the market?

The medical device market in India is Rs. 70,000 crore.  Corporate Hospitals and MNCs have lobbied for 0% import duty in name of affordability and accessibility of medical devices but passing of the reduction of MRP.

Why MRP?

Government needs to regulate the maximum mark up between ex-factory (weighted average price) and the MRP. The ex-factory price is coming down by competition, but retail prices are shooting up due to high margins charged by retailers and corporate hospitals. Companies to push their brands end up in offering high trade margins. The looser is the customer. The device company has no gain.   

Why country of origin on the label?

Many states offer incentives for products of Indian origin.  

Why Institutional status?

Many companies do not write the MRP on the plea that it is only an institutional supply and MRP is not applicable. If it is without MRP even the institutions cannot sell it to the patients.  

Who makes the profits?

The hospitals… they buy at peanuts cost but sell at a very high price on the plea that they have to store the device and make it available 365 x 24 hours. But remember, most do have a three month credit for payment and a policy to return if the device is not used. The trade margin must have a cap and the government has powers.

Dr KK Aggarwal
Padma Shri Awardee
President Elect Confederation of Medical Associations in Asia and Oceania   (CMAAO)
Group Editor-in-Chief IJCP Publications
President Heart Care Foundation of India
Past National President IMA

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