AiMeD wants govt to mandate Buy in India for devices with 50 percent price benefit for Indian products
Association of Indian Medical Device Industry (AiMeD) is of the view that since the government health departments are the largest purchaser of medical devices, it should mandate a Buy in India policy. This along with a 50 per cent price benefit if the supplier is an Indian manufacturer would bolster its Make in India programme. Along with this the government needs to look at a rationalisation of taxes to spur growth prospects for the sector.
India accounts for 800 medical device companies and country has scope to increase this to 7,000 units. Now in order to give a fillip to Make in India programme, the government needs to extend first choice to Indian manufacturers only. This practice is in vogue across the globe. Therefore India should not shy away from this practice, Rajiv Nath, forum coordinator, Association of Indian Medical Device Industry told Pharmabiz.
It should covert the import costs of medical devices of Rs. 24,000 crore and pump it in for domestic manufacturers. The basic import tariff needs to be 10 per cent for medical devices which garners export revenue of over Rs. 5 crore. The duty on components needs to be 5 per cent from next year and 7.5 per cent thereafter as a ‘Make in India’ enabler. The concessional duty on raw material can be retained at 2.5 per cent for now, for next three years, he added.
There is need for a separate ministry for pharma and medical devices. As there is a synergy in the sector. But in the case of medical devices, it requires considerable inter-ministerial coordination like electronics, commerce, DBT, DST, consumer affairs and finance. Medical devices is a life saver and therefore the government should take a cue from Japan where four member team comes directly under the Prime Minister Office. This has seen Japan to emerge from nowhere to a leadership status in the medical devices space, he noted.
From tariff rationalisation to ban on refurbished medical equipment, the government needs to take a closer look. There is no dearth of talent to manufacture medical device. But the issue is that government recognises global regulations and not the ICMED certification. No Indian healthcare provider will buy a device unless it is carries a global certification. “We are pressing the government to amend voluntary compliance backed by 3rd Party ICMED Certification as a compliance option. There is also need to cover high risk devices in 3rd Party Certification as being done for low risk. If the government recognizes more certifying bodies it will see another 100 medical device players engaged in domestic manufacture, he explained.
The country’s policy for Preferential Market Access and Preferential Pricing must be like the World Bank terms for public healthcare tenders. In addition the MRP labelling needs to be enforced on unit of sale of medical devices.
The government should not opt for NPPA for medical devices other than case of stents or combination device, having a drug. Instead it should introduce price cap mechanism of 4-5 times which is ex-factory / import landed price in a phased manner or bring in a 1 per cent cess on excise or GST on MRP to act as disincentive for putting exorbitant MRP and to incentivise ethically correct low MRP.
Ban on refurbished medical equipment, for next 5 years and a Medical Device Export Promotion & Import Substitution Council could address India’s 70 per cent import dependency and 90 per cent on medical electronics, said Nath.