India’s move toward capping the price on coronary stents reportedly has medical device makers rethinking their strategies there and even shelving new product rollouts.
“With price controls, margins of all players including manufacturers will be impacted. Global stent makers may scale back introducing their top-of-the-line brands and launch value products instead,” Rana Mehta, healthcare leader at PwC India, told the Economic Times.
Indian regulators in September 2014 floated the idea of price control measures on stents, catheters and implants in response to allegations of price gouging and bribery. India mulled imposing a maximum retail price cap on “essential” medical products, overseen by its National Pharmaceutical Pricing Authority. The proposal was spurred by allegations that some of medtech’s biggest players turned a blind eye to unethical behavior by their Indian distributors.
Bare-metal, drug-eluting and bio-resorbable stents were added to the pricing authority’s essential products list this week, setting the stage for fixed-ceiling prices for stents. Abbott (NYSE:ABT) and Medtronic (NYSE:MDT) together have a 60% share of the roughly $224 million (Rs 15 billion) Indian coronary stent market, according to the newspaper.
Himanshu Baid, chairman of CII Medical Technology Division, told the paper that the move contradicts India’s push to regulate medical devices separately from drugs and cosmetics.
“The industry is not saying that medical device prices shouldn’t be regulated, but the government should not use the same yardstick as drugs to regulate them. Companies are concerned that if they bring out new orthopaedic implants and other medical devices previously notified as drugs, their device can also be brought under price control,” Baid said.
(1 INR = $0.0149031)