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WHITE PAPER ON GLOBAL STANDARDS OF PRICING FOR STUNTS & OTHER

MEDICAL DEVICES.
The term medical devices cover a vast range of equipment, from simple tongue depressors to
hemodialysis machines. Like medicines and other health technologies, they are essential for
patient care at the bedside, at the rural health clinic or at the large, specialized hospital.
Medical devices also cost governments a substantial amount of money. In 2000, the estimated
one and a half million different medical devices available on the market represented over
US$145 billion. With innovation and the rapid advancement of technologies, medical devices
are currently one of the fastest growing industries, and the global market figure for 2006 is
expected to exceed US$260 billion. Yet many countries lack access to high-quality devices
and equipment that are appropriate for their specific epidemiological needs. This is
particularly true in developing countries, where health technology assessments are rare and
where little regulatory controls exist to prevent the importation or use of substandard devices.
With the vast majority of devices in developing countries being imported, this leaves them
prey to unscrupulous market influences and puts patients lives at risk. Governments need to
put in place policies that will address all elements related to medical devices, ranging from
access to high quality, affordable products, through to their safe and appropriate use and
disposal.1
Medical devices also cost governments a substantial amount of money. There are many
countries that lack access to high quality equipments or device which are very much
necessary for the required epidemiological needs. This is particularly true in developing
countries, where health technology assessments are rare and where little regulatory controls
exist to prevent the importation or use of substandard devices. With the vast majority of
devices in developing countries being imported, this leaves them prey to unscrupulous market
influences and puts patients lives at risk. Governments need to put in place policies that will
address all elements related to medical devices, ranging from access to high quality,
affordable products, through to their safe and appropriate use and disposal.2
1 Dregs Couverture der - WHO,
http://www.who.int/entity/medical_devices/publications/en/MD_Regulations.pdf?
ua= (accessed February 09, 2016, 6:20 p.m.).
2 Original Investigation Improving Medical Device Regulation ..,
http://www.milbank.org/uploads/documents/featuredarticles/pdf/Milbank_Quarterly (accessed February 09, 2016,6:45 p.m.).

In U.S, FDA is the primary authority to regulate medical devices and to substantiate
reasonable assurance of safety and effectiveness before allowing manufacturers to market
their products.14 This legislation has subsequently been updated with the Medical Device
User Fee and Modernization Act (MDUFMA) of 2002, which established sponsor user fees
for application reviews and set certain performance goals for the agency.3
The Therapeutic Goods Administration (TGA) is the regulatory authority for the Australian
pharmaceutical industry. The TGA oversees and regulates numerous therapeutic goods
including prescription medicines, vaccines, and medical devices.
The Federal Institute for Drugs and Medical Devices (BfArM) is responsible for licensing
and registering finished medicinal products as proof of safety and efficacy. It monitors the
risks of medicinal products by collecting and evaluating laboratory reports. The institute also
evaluates and develops safe medical devices in Germany.4
The Global Harmonization Task Force (GHTF) is a group of representatives from regulatory
authorities in USA, European Union, Japan, Australia and Canada that work to harmonize the
regulations for medical devices and improve the safety, effectiveness and quality of the
devices. The group has developed guidelines for pre-market evaluation, post-market
surveillance, quality systems, auditing and clinical safety/performance. Many countries have
begun to adopt these guidelines. Medical device requirements are basically the same in most
countries but are implemented in different ways. In the recent times, an initiative has been
taken by the International Medical Device Regulators Forum (IMDRF)5 with efforts to
standardize the regulations regarding medical device.6
3 Original Investigation Improving Medical Device Regulation ..,
http://www.milbank.org/uploads/documents/featuredarticles/pdf/Milbank_Quarterly (accessed February 09, 2016, 6:30 ).
4 http://globaledge.msu.edu/industries/pharmaceuticals/regulatory-agencies (last
accessed on 9th February ,2016, 4.40 p.m.)
5 http://www.raps.org/Regulatory-Focus/News/2014/08/14/20037/IMDRF-MovesForward-With-Effort-to-Standardize-Global-DeviceSubmissions/#sthash.8Cm65xZL.dpuf (last accessed on 9th February ,2016, 4.40
p.m.)

In India to institute price control, the draft proposes to include medical devices under Indias
Essential Commodities Act and to create a separate pricing division dedicated to medical
devices under the NPPA. Moreover, authorities could announce a new medical devices
control order that is separate from the Drug Prices Control Order, which presently covers
both medical devices and pharmaceuticals.7
In India a string of measures is going to regulate the industry under the Draft National
Medical Device Policy , it has recommended creating an autonomous body -the National
Medical Devices Authority (NDMA) -pricing control for medical devices by including them
under the Essential Commodities Act and, most importantly , floating a separate pricing
division in the drug pricing regulator, NPPA.8 It is mentioned in the draft that the government
may announce a separate policy for regulating prices of identified medical devices and
implement it through a separate medical devices control order. Currently, prices of medicines
are notified through the Drug Prices Control Order, by the department of pharmaceuticals.
In a patient-friendly measure, the draft mentions adopting policies on efficacy and safety
testing, and quality control through a `Made in India' marking (BIS) specific to medical
devices in line with global standards. In fact, the objective of the National Medical Device
Policy 2015 is strengthening the Make in India drive by reducing dependence on imports
and setting up a strong base for medical devices, especially those with critical implications in
terms of affordability and availability of patients.
Medical devices, which are classified as equipment, implants and disposables, are mainly
import driven, with nearly 70-80% high-end devices and equipment brought into the country,
while the domestic industry manufactures disposables and medical supplies. Lack of
national regulation helped the MNCs in doing business in this sector, it says. Incidentally,
6 Global Regulatory Requirements for Medical Devices, http://www.divaportal.org/smash/get/diva2:121327/FULLTEXT01.pdf (accessed February 09,
2016,6:00 pm).
7 http://www.meddeviceonline.com/doc/india-to-form-independent-medicaldevice-regulation-body-0001(last accessed on 9th February ,2016, 4.50 p.m.)
8 India To Form Independent Medical Device Regulation Body,
http://www.meddeviceonline.com/doc/india-to-form-independent-medical-deviceregu (accessed February 09, 2016, 5:30 pm).

the Drugs and Cosmetics (Amendment) Bill, 2015, for providing regulation on medical
devices is also in the legislative process.
It has been observed that many patients are overcharged upto 3-4 times to the actual cost
of the device like cardiac stents, etc. and hence, sold with huge mark-ups of 250-400%. 9 In
India the Drug Control Administration (DCA) and Central Drugs Standard Control
Organization (CDSCO) have said that the National Pharmaceutical Pricing Authority (NPPA)
is collecting data on stents and other medical devices from all States to chalk out a strategy to
regulate pricing.10 This will help in monopoly while selling of these life saving medical
devices.
The concept of Capitated Pricing' mechanism, being implemented in United States and a few
European countries, could become a norm in India. Analyses based on cost differences and
process improvements are parts of the puzzle, and so is an understanding of the competitive
landscape. But good pricing decisions are based on an expansive rather than an incremental
approach. Before zeroing in on a price that promises the greatest long-term profitability,
companies must know both the highest and the lowest prices they could charge. Price-benefit
analysis should begin early in the development cycle, when the market is first being probed,
for it not only shows companies whether price barriers might make products unfeasible but
can also guide their development by indicating which attributes customers are most willing to
pay for. And the more novel a product may be, the more important it is for companies to take
a broader view of the pricing possibilities.11.

9 Medical devices like stents, implants set to come under price ..,
http://health.economictimes.indiatimes.com/news/medical-devices/medicaldevices- (accessed February 09, 2016).
10 http://www.thehindu.com/news/cities/Hyderabad/pricing-of-stents-to-beregulated/article2508431.ece (last accessed on 9th February ,2016, 4.40 p.m.)
11 Pricing new products | McKinsey & Company,
http://www.mckinsey.com/insights/marketing_sales/pricing_new_products
(accessed February 09, 2016)