Capping stent prices
The National Pharmaceutical Pricing Authority (NPPA) is seriously trying to regulate prices of stents to bring down angioplasty costs.
India is a country of 1.2 billion and almost one fourth of deaths every year are due to cardio vascular diseases. Experts say the number of angioplasties involving either drug eluting stents (DES) or bare metal stents (BMS) are less than 6.5 lakhs a year, one of the lowest in the world.
The stent market in the country is only just over Rs 3,000 crore and there are only about 20 manufacturers. Of these, multinational Abbott controls almost 40-50 per cent of that market.
Of these, just three - Abbott, Boston Scientific and Medtronic - supply USFDA (the US Food and Drug Administration) approved products, which is mandatory for many corporate hospitals having international accreditations to use. Though a medical device, it is regarded as a drug in India and is treated as a drug, which helps NPPA to control its prices.
The NPPA estimates while the margins of the manufacturers are low, the distributors take 13 per cent to 200 per cent margins and the hospitals hike prices in the range of 11 per cent to 654 per cent. Based on data from the manufacturers, the regulator estimates actual prices of stents vary from Rs 22,000 to Rs 68,000. But the patients pay minimum Rs 1.2 to Rs.2.2 lakhs on such surgeries.
The distributors argue they have to stock about 50 different stents from each of these manufactures (which increases their inventory costs) as specifications for patients are different. They have to pay to the manufacturers or importers without much credit period.
As against this, the hospitals pay only after 90-120 days cycle. Whether their claims are right or not, it is fact that hospitals charge exorbitantly for the surgery and are reluctant to use stents from outside hospital pharmacies, citing complexity of the surgery and standards of the medical equipment.
In a recent issue, K.M. Gopakumar, a Delhi based public health expert complained to various medical and human rights authorities in Kerala against the Kochi based Amrita Institute of Medical Sciences for overcharging prices of stents. His father, a heart patient, was asked to pay Rs.2.85 lakh as the cost of three cardiac stents.
Gopakaumar was ready to provide the same stents directly purchased from the distributor at a price of Rs.80,000, but the hospital was adamant and finally he had to pay Rs.1.7 lakhs. Such instances reveal the nexus involving manufacturers-distributors and hospitals.
But can the NPPA move to cap stent prices really help patients to undergo such life saving surgeries at lesser costs? It is an unlikely scenario, say healthcare experts. The hospitals can charge the same surgery costs to compensate by hiking other components of the angioplasty 'package' like room rent, medicines, surgery fee etc, they cite.
In reality, the authorities should look at bringing down surgery costs as a whole, not alone a medical device used in such costly life saving procedures.