Modi’s Visit to US: US MNC Lobby Pressurises India to Roll Back Price Caps on Stents

In their constant bid to put pressure on the Centre to roll back prices of stents, a delegation comprising of US Medical Device Multinationals along with the US Ambassador Kenneth I Juster met the Commerce and Industry Minister, Piyush Goyal, pitching for MNC lobby’s interest, and seemingly attempting to influence internal Indian policies away from affordable patient care ahead of PM Modi's visit to US.

Modi in Houston, Texas, USA: Twitter

Once again US multinationals are putting extreme pressures on GoI through the US embassy to dilute price caps and replace it with soft trade margin caps so that they can enjoy the same 200% -300% profit markups from the patients in India.

Rajiv Nath, Forum Coordinator, AIMED, said that apparently, even last year their attempts to pressurize former Commerce Minister Suresh Prabhu prior to & during his visit to US to attend USTR failed as Prabhu did not relent to MNC lobbying pressure to protect their profiteering & decided to protect healthcare interest of common masses & safeguard the Ayushman Bharat Modicare programme by not rolling back Price Caps on Stents.

Shockingly even after 72 years of our independence, India is 80% to 90% import-dependent in Medical Devices (for Financial Year 2018-19 – Rs. 38,800 Crores), ironically out of which we import nearly 1/4th from the USA (copy enclosed). So we are surprised even after achieving a dominant supplier status, USTR is presenting a lack of access to the Indian market by USA Medtech Companies as a grievance. Instead of being defensive we need to share the facts that it is Indian manufacturers who are being battered by aggressive competition & lobbying power of USA Companies and Indian manufacturers have their own set of grievances that may be addressed by USTR.  Though the Indian market is wide open for USA Companies, Indian manufacturers do not get reciprocal access to the USA market.

 

The beleaguered 80-90% import-dependent Indian Medical Device Industry has full faith in GoI that they will not succumb to the US MNC Lobby’s arm twisting tactics and will  listen to the request of The Indian Medical Devices Industry to not to remove price caps on stents to ensure continued affordable access to Indian consumers and allow Indian manufacturers to continue to further gain credibility that their lower price is NOT lower quality or less safe and less innovative, as some lobbyists would like us to believe.

 

Gurmit Chugh, MD,  Translumina, a leading Domestic Stent manufacturer, said that the importers' lobby is least concerned about making healthcare affordable for Indian consumers & Indian Medical Device Industry but thinks only for protecting their own profits.

 

Nath, said that at AiMeD they have been specifically seeking Trade Margin Caps on Devices notified as Drugs but from 1st point of sale in Supply Chain, which as per us is when 1st sale takes place and GST is applied 1st time e.g. when goods enter the country. This will maintain parity between Indian & overseas manufacturers.

 

Earlier the NPPA (National Pharmaceutical Pricing Authority) capped prices of stents to end exploitative pricing and vulgar profiteering. NPPA data indicated that cardiovascular stents were being sold by hospitals at extremely high markups (for example, 436% for bare metal stents and 654% in the case of drug eluting stents, on average).

It is ironic that whereas on one side the whole world applauded Govt. of India’s huge step of price cap towards making essential medical products available across the country at affordable prices, on the other side the USA MNC Manufacturers of Stents for their selfish nefarious gains are still raising issues against Govt. of India’s decision of controlling stent prices.

Chugh said that any attempt to pacify the powerful US MNCs who are using their deep pockets clout to lobby for a favorable Policy to keep themselves out of trade Margins and price controls, need to be reviewed with caution by Government on the impact it would have on affordable access or competitive growth of Indian made products. 

Chugh further added that so far India has capped prices of only Stents and Knee Implants and not rest of Medical Devices though Patient Groups like AIDAN and Domestic Manufacturers lobby - AiMeD have been seeking price controls to be applied on other devices too to address the higher trade margins induced unethical marketing. The price of Stents being sold by USA MNC in Europe is still lower than the capped price in India. When MRP is capped it is the Trader’s Margin that gets affected. NPPA/DPCO does not regulate the Import landed price of overseas Manufacturer or Ex-factory price of Indian manufacturer so if the manufacturer’s profit margin is not touched, why should manufacturers have a grievance of capping of price or Trade Margin? Indian manufacturers will not be complaining against price capping as long as the trade margins capping is reasonable and does not choke the supply chain. We support this policy as it leads to ethical marketing and Hospitals start choosing a brand to reduce their cost instead of choosing a brand for maximizing profits from a hapless patient who have no choice on what brand of device will be used on them and was cleverly being pushed the highest priced ones.

Main image courtesy: Twitter