NPPA reports 88% price reduction in one-third of domestic brands of medical devices following trade margin cap

The National Pharmaceutical Pricing Authority (NPPA) has reported 88% price reduction in one-third of domestic brands of medical devices following trade margin cap at 70% for pulse oximeter, blood pressure monitoring machine, nebuliser, digital thermometer and glucometer.

Ninety one per cent of the five medical device brands on which a 70% trade margin cap was imposed have shown a price reduction. NPPA has received price listings from almost 800 brands from these five medical devices manufacturers.

The trade margin was capped through a Gazette Notification dated July 13, 2021.

The drug price regulator has capped the trade margin at Price to Distributor (PTD) at 70 per cent for these 5 medical devices. The manufacturers and importers were directed to comply with the notification and submit revised maximum retail price (MRP) in the prescribed format to the authority, to the state licensing authorities and dealers by July 20, 2021.

“Since these 5 medical devices do not fall under the category of scheduled drugs and therefore do not fall under the purview of price control or ceiling price fixation, it became necessary for the Government to cap the trade margin of these devices to make them affordable and accessible during pandemic situation. It is a win-win situation for manufacturers, consumers and Government to be able to make home care and hospital care more accessible,” informed NPPA Chairman Shubhra Singh.

“If prices come down by Rs 5,000 to 15,000 for each device, it will be helpful for people both in hospitals and in home management. So we invoked extraordinary powers for the benefit of the public and capped the margins at 70% at the trader level,” she added.

NPPA has observed that these devices are important in managing Covid-19 pandemic, not only for home use, but in hospital management too. It also learnt that these are sold at up to 700% margin at distributor level.

“One third of the domestic brands have reduced prices, but for imported brands, it was almost double. This is a booster dose in the arm for Make in India as it has provided level playing field and healthy competition for Indigenous manufacturers. Industry associations have also appreciated and supported the move,” said Singh.

In June, 2021, NPPA had reduced the price of oxygen concentrator by 70% and this led to 54% of price reduction with no issue in terms of availability.