Hong Kong’s hospitals to purchase new medical equipment
Recent investigations found that many of the more sophisticated medical devices that are generally available in more developed countries are outdated or lacking in Hong Kong’s public hospitals. Responding in part to these investigations, the Hong Kong government is allotting over $50 million to the Health Authority for medical equipment.
The Health Authority is Hong Kong’s public hospital agency and manages over fifty hospitals. It is expected to purchase many new MRI scanners, gamma cameras, cardiac catheter machines, linear accelerators, fluoroscopy machines, and radiography units. This development is significant because most of Hong Kong’s population only accesses healthcare through public hospitals. Many of Hong Kong’s medical devices are imported.
Compared to OECD countries, Hong Kong has very low figures for MRI scanner to population and CT scanner to population ratios. The Health Authority has identified this as an important issue to address this year, since some patients have to wait months for a diagnostic scan. In Hong Kong, there are less than three CT scanners for every one million people, which is just one-third the number of scanners that Britain or Singapore have for the same number of people. Similarly, there are less than two MRI scanners for every one million people, which is also only about one-third the number of scanners that Britain or Singapore have for the same number of people.
To help stay on top of medical technology availability, the Health Authority will create a system to consistently evaluate the medical devices in public hospitals. Equipment will be considered for replacement based on number of years in use, availability of new or innovative devices, and more. Thus, Hong Kong’s hospitals will likely continue to purchase medical technology regularly even after the surge in medical equipment procurement this year.
Smoking in China to continue demand for cancer and respiratory disease medtech
The World Health Organization (WHO) recently released the "Global Adult Tobacco Survey." It includes statistics on smoking in China that represent the entire country. The study indicates that smoking among men in China (regardless of age) continue to occur at very high rates. Over 52 percent of all men currently smoke in China. Smoking among women, on the other hand, is very low; only 2.4 percent of women in China smoke. With so many men in China smoking, Western drugs and medical devices for treating these conditions will continue to be in high demand for the foreseeable future.
If over 52 percent of all men in China are smoking, one conclusion is that at least 1 in every 4 people is a smoker. In other words, over 300 million people out of 1.3 billion in China are smoking. Even more are exposed to second hand smoke. All of these people have a high risk of developing lung cancer, liver cancer, stomach cancer, esophageal cancer, or other forms of cancer. Additionally, they are at risk for respiratory diseases such as chronic obstructive pulmonary disease. Cardiovascular diseases such as stroke and coronary heart disease are also occurring at high rates because of smoking. Every year, over 600,000 deaths out of approximately nine million in China are caused by one of these conditions that originated from smoking.
This survey on smokers in China also factored in age. Studies illustrate how smokers between the age of 15 and 24 are likely to remain smokers forever. The Global Adult Tobacco Survey found that 33.6 percent of men in China and 0.7 percent of women in China in this age group are currently smokers. This high percentage of young smoking men in China can also be seen as an indicator for continued smoking (and hence, chronic conditions caused by smoking) in China’s future.
India’s Central Drug Standard Control Organization releases drafts of medical device regulatory applications
India continues to signal that new medical device regulations are on the horizon. On August 4, 2010, the Central Drugs Standard Control Organization (CDSCO) released online a draft of two different medical device-related documents: the "Guidance Document on Common Submission Format for Registration of Medical Devices in India" and the "Requirements for Conducting Clinical Trial(s) of Medical Devices in India." The CDSCO solicited opinions on these drafts from all readers, and opinions were due on August 25, 2010.
In the "Guidance Document on Common Submission Format for Registration of Medical Devices in India," there are general instructions on how to apply for medical device registration. The guidance lists the 15 commonly required components, including: a "covering letter" (essentially a signed summary of the application’s purpose and contents), an authorization letter that serves as proof of a local agent, and Form 40 (a standard form that includes information on the device, manufacturing site, fees for registration, and more), Plant Master File, etc. Most of the Indian government issued documents are included as annexes in the guidance.
"Requirements for Conducting Clinical Trial(s) of Medical Devices in India" similarly provides basic instructions on how to apply for clinical trials for medical devices. Most companies will have to include 17 parts in the application. Key forms are included in this guidance. For example, significant technical data will be required for submission, such as design analysis data, biocompatibility data, animal study data (if applicable), and more.
The CDSCO is in charge of the Drug and Cosmetics Act (DCA). Under the DCA, at least 14 categories of medical devices are listed as drugs. There are an additional number of medical devices that are listed as "notified medical devices" in the DCA. The medical devices considered as drugs and the "notified medical devices" are currently regulated under the DCA and require registration.
In recent years, there has been significant discussion on how to begin regulations on the rest of the medical devices in India. Many analysts expect the Ministry of Health and Family Welfare’s bill that would revise the DCA to become the law on medical devices. In this bill, the DCA would include details on the creation of a new organization, currently called the Central Drug Authority (CDA), which would regulate both drugs and medical devices. This bill would lead to a comprehensive four class medical device risk classification system, enforce safety standards, conduct post-marketing surveillance, and more. The CDSCO’s guidances may become the official guidelines if this bill were to become law. The bill is expected to pass within the next few years.
Taiwan’s new national health insurance bill may alter drug price gaps
Taiwan’s Dept. of Health (DOH) has been proposing a "Second-Generation National Health Insurance" bill (2G NHI Bill) since March 2010. Although President Ma Ying-jeou is advocating a quick implementation, legislators are still reviewing the details. The most recent topic of discussion is how to best modify the drug price gap to meet the goals of the reform.
Under Taiwan’s current healthcare system, most of the population depends on health insurance reimbursement for drugs. The national health insurance system regulates drug prices. This is done by standardizing the amount of reimbursement medical institutions receive for each drug (drug reimbursement prices are listed in the Pharmaceutical Benefit Scheme). However, this reimbursement price can sometimes be lower than the hospital or clinic’s cost of procuring the drug from a distributor. This difference between the reimbursement price and the actual procurement price is known as the "drug price gap."
Drug price gaps are bad for both hospitals and pharmaceutical companies. When the cost of buying a drug is much higher than the reimbursement level, hospitals make less money. At the same time, drug companies have to deal with hospitals that routinely bargain for lower procurement prices. This creates competition between drug companies that have similar products. Studies have shown that some foreign drug companies have been turned off from marketing opportunities in Taiwan by this situation. Six different government-imposed drug price decreases have further exacerbated the problem. These drug price cuts meant less reimbursement for certain drugs. The effect was that even more hospitals and clinics had to ask drug distributors for discounts.
As the drug price gap is being addressed in the 2G NHI Bill, legislators will likely respond. This bill is expected to help create a more favorable market environment for drug companies and hospitals in Taiwan by limiting the drug price gap.
Taiwan’s 2G NHI Bill primarily aims to reform the calculation of premiums. The new bill will factor in household size, total household income, and more. Other changes such as the aforementioned curbing of the drug price gap are also anticipated. A final version of the bill is expected to be released by December 2010. Taiwan’s pharmaceutical regulations will change accordingly in the coming years.
Ames Gross is president and founder of Pacific Bridge Medical, recognized nationally and internationally as a leader in the Asian medical markets. Founded in 1988 PBM has helped hundreds of medical companies with business development and regulatory issues in Asia. Contact PBM at email@example.com.
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