Our 25th Year of Publication
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Cover Story

Roadmap for Indian Medical Device Industry

By Rajiv Nath
Forum Coordinator, Association of Indian Medical Device Industry (AIMED),
New Delhi, Joint Managing Director, Hindustan Syringes & Medical Devices Ltd.



Key Initiatives Set By in Motion AiMed


AiMeD has created a dialogue with various government departments and ministries to highlight the issues faced by the medical device industry and prepare a strategic roadmap to address India’s import dependency in medical devices to reverse it to make India one of the top five medical devices manufacturing hubs in the world. We have submitted a defined roadmap and task list with Department of Industrial Policy & Promotion (DIPP) and Department of Personnel (DOP) to enable ‘Make in India’. With Ministry of Health and Family Welfare (MoH & FW) we have requested for regulations to address patient safety while creating trust for India-made devices but not of traditional. License Raj-type relying on inspection by government inspectors but by unbundling of regulations and ensuring maximum governance with minimal government and ease of doing business by utilising third party certification bodies. Some of the other key initiatives include Department of Revenue and Tariff Commission a review of the inverted duty structure that was making imports cheaper than manufacturing, with Department of Commerce and Engineering Export Promotion Council (EEPC) a focus is on creating brand India and a coordinated overseas marketing plan to unleash our export potential.


Achievements in the HealthCare Sector


More than AiMED’s list let me share the government’s Progress Report (some of them triggered by aforemen tioned initiatives) which includes :


  1. Request to government to address Inverted Duty Structure and nominal Tariff Protection :
      - Revise Basic Duty on Import of Medical Devices to 10% Basic, as earlier (now 7.5% done on January 19, 2016 for 78 items, 21 pending
      - Government to revise special additional duty on medical devices to 4% as earlier to enable business viability (Done on Jan 19th 2016 for 78 items, rest
         21 to be covered)
      - Government reduced duty on imported Raw Material to 2.5% on Jan 19, 2016 for above 78 items.

  1. For enabling consumer protection our proposed tax-based disincentive are pending. However, steps are being taken by Department of Consumer Affairs to ensure all medical devices carry an MRP whether they are an OTC product or not and NPPA is bringing Stents under price control.

  1. QCI introduced ICMED 13485 Quality Certification System as a pre-cursor to medical device regulations for enabling confidence in quality of Indian products (Done on 15th March 2016) and have held a series of workshops in Delhi, Mumbai, Chennai, Pune, Ahmedabad, and Bangalore with financial support from Department of Commerce on capacity building of Manufacturers for building QMS - Quality Management Systems capability development for getting CE and ICMED Certification. On our request to create a Separate Rule Book for Devices, the Mo-H&FW responded favourably and subsequently on 19 October, 2016 the initial draft of the separate rules to regulate medical devices was shared with the stakeholders and uploaded on website for public comments. Comments have been collected and collated and the draft updated and rules are in process of notification. Also in response to our request for a Separate Law from Drugs & Cosmetics Act, a draft Medical Device Bill has, meanwhile, been prepared by MOH&FW and is going internal review within the Ministry, thereafter Stakeholders will be invited for consultations and thereafter we expect this to be uploaded on the website for public comments before being presented to the parliament by ministry.

  1. On our request to government to review and pull back its Auto Approval Brownfield FDI Policy - it’s ok to retain this for 100% Green Field Projects for manufacturing, not trading - for ensuring choice of Indian brands to Indian consumers , RBI has initiated investigation on the 100% FDI policy for potential misuse and its impact.


About Challenges Faced By Indian Medical Devices Industry


The Indian medical device industry is facing the challenge of having to compete with imports with deep pocketed MNC importers and pseudo manufacturers in a very adverse eco system that is encouraging imports-based trading instead of manufacturing so that even existing Indian manufacturers are shifting to imports as that is more convenient and more profitable than to produce in India. From being a manufacturing-led economy, India is becoming a trading and services- led economy in the past decade. Manufacturing was brought back into focus by the honourable Prime Minister with his slogan and vision of Make in India and starting point is to make illegal – pseudo manufacturers by clearly defining it as falsely and purportedly claiming to being an Indian manufacturers without actual manufacturing it in India – manufacturing site and country of origin needs to be clearly labeled to ensure transparency and tracking and the site where there is a value addition of over 40% and there’s a change of sub-heading of classification indicating transformation of an output from more than one input so at least it’s an assembly of components.


How Can Government Facilitate to Make India a Global Hub For Medical Equipment Manufacturers.


Most of the policy decisions taken in the past have been based on White Papers published at the behest of MNCs who are ruling the roost in CII and FICCI – (importers with overseas manufacturing facilities) who are comfortable to access the large unregulated Indian market with minimal tariff barriers and while they make right sounding noises they have been opposing most of the five corrective strategic actions suggested by AiMeD that could strengthen Make in India or help make Indian manufacturers more competitive and thereby increase their market share, such as: Tariff Correction, with the plea that it affects affordability and accessibility to poor patients. Our contention is being to make manufacturing viable and profitable as before and reverse ongoing trend of manufacturers becoming importers / traders. Later domestic competition will bring down prices. Regulations, (Short Term Correction of Amending Rules , Schedule MIII, Guidelines, etc.) with the plea that it would lead to further confusion and affects accessibility and better to wait till a law is passed. Our contention being to use the available short term solutions of administrative circulars and of executive orders rather than delay till availability of lengthy legislative process. Mandatory MRP & Price Capping – With the plea that it will scare away investment. Our contention being that affordability and competition is getting skewed - not lower ex-factory price but higher retail price wins and consumers are suffering from artificial inflation and domestic manufacturers suffer from loss of market share unless they match ever increasing MRP and trade margin. ICMED – Self Certification and Self Regulation, with the plea that it creates a parallel mechanism with CDSCO so better to have only one control and are afraid it could be used as a non-tariff barrier in due course. Our contention being it provides credibility to Indian products and low cost access to local certification rather than getting expensive overseas certification for CE / ISO 13485 etc. and respect for Indian brand, a law to regulate all devices may not be there for a few years and a law can permit voluntary certification. Preferential Market Access – With the plea that it restricts access to quality products in the absence of regulations. Our contention is it will boost domestic manufacturing and also stop usage of USFDA compliance as a mandatory qualifying criteria in many tenders. Why should Indian manufacturers be denied access to our own Indian market unless they comply with a foreign country regulatory approval of CE / USFDA ? It’s unfair. Use ICMED!


(Based On a Recent Interview Published in “eHealth”)


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