Medical Device Pricing Controls May Be Coming to India

The National Pharmaceutical Pricing Authority (NPPA) in India is considering applying the Drug Price Control Order (DPCO) to medical devices. Importers of notified cardiovascular and orthopedic devices have been put on notice to control mark ups, or the NPPA will intercede. If so, limits will be applied to the difference between landed cost and the Maximum Retail Price (MRP) anticipated to be around 35%.

The NPPA is not part of the FDA, but resides within the Ministry of Chemicals and Fertilizers and has well developed price monitoring and control systems already applied to pharmaceuticals and most recently I.V. Fluids (e.g., Gazette Notifications for Ceiling Prices/retail price under DPCO, 2013).

The practical implication is negative pressure on the top line revenue for affected importers/distributors with subsequent belt-tightening likely. Sales channel efficiency will become increasingly important.