Price control on stents brought consolidation

NPPA regulation reduced import dependency, rationalised margins earned by hospitals on foreign stents

By Author  |  Published: 25th Mar 2019  12:07 amUpdated: 24th Mar 2019  9:13 pm

Hyderabad: The National Pharmaceutical Pricing Authority (NPPA), which brought price control on stents, in two consecutive years, has led to the emergence of Indian stent manufacturers taking care of the bulk of the domestic market needs. Before the price cap, imported stents accounted for 65 per cent of the market, which has gone down to 20 per cent after the price cap.

In February 2018, NPPA capped the prices to Rs 7,660 for bare metal stents (BMS) and Rs 27,890 for drug eluting stents (DES). NPPA’s original price cut in February 2017 lowered the prices of stents as much as 85 per cent. Before the price cut, BMS was sold at Rs 45,000 (to Rs 7,260) and DES for Rs 1.21 lakh (Rs 29,600).

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India has nearly six crore heart patients, out of which 5 -5.5 lakh patients undergo a stent procedure every year. A cardiac stent is a device used to unblock clogged arteries. The drug- eluting stents are coated with medicines that help lower chances of an artery narrowing afresh post a corrective surgery.

India’s indigenous stent came in the year 1997 when Sahajanand Medical Technologies (SMT) became the first manufacturer of cardiovascular medical stents. Soon, other players such as Merril and Translumina joined the race. With the number of stent procedures being high, Indian market witnessed several companies vying for a pie. Post the NPPA price cap, the market witnessed withdrawal of high-end stents. Soon, Indian stent makers started gaining confidence of the healthcare sector on a par with their global peers. As a result, Indian stent makers garnered a significant 80 per cent share in the market.

Stronghold on market
Talking about the growth of domestic stents industry, Ganesh Sabat, CEO, Sahajanand Medical Technologies told Telangana Today, “The stent market is valued at Rs 3,000 crore in India. The Indian industry’s market share has certainly increased due to growth of SMT and Translumina whereas Meril and many other Indian companies did not grow substantially. Overall Indian players have grown their market share.”

Indian stent market is dominated by the DES, accounting for 95 per cent of the overall market. The BMS market is negligible. DES share is growing ever year while BMS share is declining. There is a healthy growth of 20 per cent year-on-year in coronary stent market in India.

On the impact of NPPA price control, he explains, “NPPA decision is more beneficial from the patient perspective. It does not discriminate between Indian and foreign stent makers. The move capped the trade margin at 8 per cent. The companies (both domestic and foreign), which were dependent on channel partners for their sale did not grow. Also, the profit margin earned by hospitals on foreign stents declined substantially. The profitability between Indian stents and foreign stents became same. This ensured stoppage of the practice of distinguishing Indian stents and foreign stents by hospitals due to high profit margins earned by them. It made sure that the hospitals are not selecting stents based on commercial reason but on scientific reason.”

The NPPA decision has also helped patients in many hospitals in tier II and tier III cities, including treatment receive.

 

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