4 more medical devices to be added to price control list, document shows

New Delhi/Mumbai: India's drug-pricing regulator has asked the health ministry to add four more medical devices to a list of products eligible for price controls to reduce costs to patients, which if agreed could be another blow to the country's $5 billion-a-year medical-technology industry.

The National Pharmaceutical Pricing Authority (NPPA) had said it did not plan further measures after prices of some heart stents were cut in February by 75 percent, part of a government push to make life-saving drugs and devices more affordable.

But a letter to the health ministry sent in March, which has not previously been made public, shows the regulator pushed to get four more devices on the "essential medicines" list that would allow the government to impose price caps if and when it was ready to do so.

After the February move, Medtronic PLC and Abbott Laboratories tried to withdraw some of their stents -wire mesh structures used to treat blocked arteries - but their request was rejected. Boston Scientific Corp sought to have the price cap raised, but a government panel turned down their plea.

According to the March letter seen by Reuters, NPPA Chairman Bhupendra Singh said the essential medicines list - comprised of more than 350 items, most of them drugs - should include balloons, cardiac catheters, and covered as well as peripheral stents, "as soon as possible".

These devices are used in the treatment of heart ailments or to open blocked blood vessels elsewhere in the body.

Singh said that hospitals appeared to be compensating for the lower stent prices by charging more for other procedures and devices.

"It has been found that after the price control of cardiac stents several hospitals have increased the various 'procedure charges' in order to compensate for their losses," Singh said in the letter, without elaborating on how the discovery was made.

"In some cases the cost of balloons and catheters have been charged at (a) much higher level than the cost of (the) stent itself," he wrote.

Prime Minister Narendra Modi's administration has pushed to make healthcare more affordable in India by trying to curb prices on drugs used to treat critical ailments such as cancer,HIV/AIDS and diabetes.

"I would request you to kindly consider on this issue and take necessary actions so that government's intention of passingon the benefit to the poor is not frustrated by the hospitals/doctors," Singh wrote in his letter.

A health ministry official who asked not to be named confirmed the regulator had made the request but played down its significance on the grounds the list of essential medicines was unlikely to be reviewed in the next 1-2 years.

Singh's office did not respond to an email seeking comment.

After the stent price move, Boston Scientific asked the government for the price cap on its high-end Synergy stents,which was set at $450, to be raised to around $1,160, down from its earlier cost of around $3,000 but still well above the $750 it costs to import the device.

The medical industry has argued that price control measures hamper innovation and would affect future investment plans inIndia. Boston Scientific, for example, uses India as a research base to develop products for emerging markets.

The domestic medical device market in India is expected to grow by 15 percent annually between 2014 and 2020 to $8.6billion, according to a joint report by consultants Deloitte and Healthcare Federation of India, NATHEALTH.

(Reporting by Aditya Kalra and Zeba Siddiqui; Editing by Tom Lasseter, Paritosh Bansal and Sonya Hepinstall)