NPPA may cut stent prices by more than 50 per cent

NEW DELHI: The National Pharmaceutical Pricing Authority (NPPA) may more than halve the price of life-saving coronary stents, according to the latest ceiling prices it is considering. Soon, patients may not have to pay more than Rs 70,000 for a drug-eluting or biodegradable stent.
The drug-pricing regulator's proposals have added fuel to an ongoing debate about which formula for capping these devices would improve patient access, without making the stent industry unviable.

While stent makers urge the NPPA to cap stent prices by averaging the rates at which hospitals buy them, patient access bodies insist on formulae that could bring prices of stents costing as much as Rs 1.95 lakh down to as little as Rs 22,500.

Acoronary stent is a wire mesh tube used to prevent heart attacks by clearing blockages in the arteries pumping blood to the heart. Over 90% of stents implanted in India are Drug Eluting Stents (DES)—metal stents coated with a drug that will prevent the arteries from closing again.

At present, the maximum retail prices (MRP) of DES range from Rs 23,625 as part of the Central Government Health Scheme (CGHS), to over Rs 1.50 lakh for the latest launches.

Most of NPPA's proposed formulae to cap stent prices result in DES ceiling prices between Rs 20,000-Rs 40,000, while the highest —Rs 67,272—has been calculated using the average price to hospital, topped with a 16% margin.

Patient access group All India Drug Action Network (AIDAN) is opposed to using this formula because it feels the data is unreliable, inflated and unverifiable and unethical distribution practices will persist. “A 16% markup in the price to hospital formula is just legitimising the hospital's cut. ?” said Malini Aisola, an AIDAN coordinator.

NPPA's data shows that distributors, on average, mark up the stent's price by 68% when selling to the hospital, AIDAN said, adding that the price is already marked up 112% by the time the distributor buys it.

“On the basis of the data shared by NPPA, it is clear that there are massive markups throughout the supply chain and that it is an industry-wide practice,” Aisola said. “Therefore, this formula (of price to hospital) does not ensure affordability.”

AIDAN is pushing for formulae like those using CGHS prices or the cost of producing these stents, as benchmarks to find the ceiling price because it feels these would ensure the patients affordability.

On the other hand, indigenous and multinational companies have urged NPPA to use the price to hospital formula, arguing that the other formulae, especially those using CGHS prices, would make the country's stent industry unviable.

Capping the prices using CGHS rates, despite margins, would be a disincentive to bring in newer technology, according to the Medical Technology Association of India (MTaI). The body is a lobby group for research-based global medical device companies like Abbott India and Medtronic.

“Most companies will only sell earlier generation stents at the CGHS rates because cost of producing the latest stents, including R&D, is much higher than this price,” argued Probir Das, Director, MTaI. According to Das, profitability for global medical device companies is already far lower in India than it is in other markets.

Association of Medical Devices Industry (AiMeD) said stent makers are able to subsidise the prices of stents they give to CGHS patients only by earning profits from the private segment where patients can afford the higher prices. AiMeD is a lobby group for domestic stent companies like Meril Life Sciences and Sahajanand Medical Technologies.