A Parliamentary Standing Committee has asked the Government to bring more high-volume medical devices, such as advanced pacemakers and ophthalmic lenses, under the price-control framework to improve affordability and access to healthcare.
In its 176th report on ‘affordability and accessibility of healthcare facilities in the public and private sectors’, the Committee on Health and Welfare recommended that the Standing National Committee on Medicines (SNCM) systematically examine and include commonly used diagnostic and therapeutic medical devices in the scheduled list under the Drugs (Prices Control) Order (DPCO).
The committee which tabled its report in Parliament last month said the scope of the National List of Essential Medicines (NLEM) should evolve with advances in medical technology and changing healthcare needs.
The committee, headed by Rajya Sabha Member of Parliament Prof. Ram Gopal Yadav, said the fixation of ceiling prices/MRP under various NLEMs under DPCO, from time to time, has resulted in an average annual total saving of more than Rs 26,000 crore to the public due to the implementation of DPCO.
For instance, it pointed out that inclusion of coronary stents and knee implants in the NLEM brought under price regulation had helped protect patients from high treatment costs. According to the report, price caps on coronary stents have resulted in annual consumer savings of Rs 13,353 crore.
Medical devices are an important component of the cost of many hospital procedures. For patients requiring implants or long-term medical equipment, the device cost can add significantly to the overall treatment bill, it noted.
The impact is likely to be particularly relevant for low-income and middle-income households that pay for a substantial part of their healthcare expenses directly.
A reduction in the price of commonly used devices could lower the financial burden of treatment, particularly for procedures involving implants or other expensive equipment, said the panel.
The committee also examined the government's pilot Trade Margin Rationalisation (TMR) measures for medicines and medical devices.
It noted that trade margins had been capped at 30% for 42 non-scheduled anti-cancer medicines and at 70% of the price to the distributor for certain critical medical devices, including oxygen concentrators, pulse oximeters and glucometers.
According to the report, these measures have resulted in cumulative annual savings of more than Rs 1,984 crore for consumers.
The committee said the experience indicated that regulation of trade margins could play a role in reducing the prices paid by consumers.
It recommended establishing a permanent statutory framework for trade margin rationalisation under the DPCO, 2013. The proposed framework could also extend price controls to a wider range of high-cost, non-scheduled medicines used for chronic diseases.
The committee also noted that the collective average markup for common dosage forms was around 43% and said there was a need to address excessive margins while ensuring that essential medicines and devices remain available.
For patients, the issue extends beyond the initial purchase of a device. Some equipment, such as glucometers and pulse oximeters, may be used repeatedly, while patients with chronic conditions can require continued monitoring and replacement of components.
Lower prices could therefore reduce recurring healthcare expenditure as well as the cost of individual procedures, said the panel.
The committee, however, also flagged concerns raised by micro, small and medium enterprises (MSMEs) in the pharmaceutical and medical-device sectors.
Many smaller manufacturers depend on traditional distribution and retail networks to reach hospitals and patients. The committee said any final trade-margin framework should take these concerns into account and suggested a graded markup structure.
Such a structure, it said, could protect low-cost MSME manufacturers from being displaced while ensuring that consumers are protected from excessive prices.
The recommendation comes amid growing recognition that healthcare affordability cannot be addressed only through drug prices. Medical devices, diagnostic equipment and implants have become integral to modern treatment, particularly in tertiary care.
The committee said advanced medical devices and complex combination formulations had become fundamental to modern healthcare and should therefore be considered when defining healthcare accessibility.
It recommended that the government systematically review high-volume diagnostic and therapeutic devices and assess them for inclusion in the scheduled list of the DPCO.
The panel also referred to a recent recommendation of the Department-related Parliamentary Standing Committee on Chemicals and Fertilisers, which had called on the Department of Pharmaceuticals to prioritise an enabling provision for trade margin rationalisation of life-saving medicines, including anti-cancer drugs.
The Health Committee said concerns of pharmaceutical manufacturers and MSMEs were important but should not delay efforts to make medicines affordable.
The recommendations, if accepted and implemented, could widen the scope of price regulation beyond medicines and some currently regulated devices. For patients, the potential benefit would depend on which devices are eventually included, the price ceilings or margins prescribed, and effective monitoring of prices in the market.
